I

104TH CONGRESS

1ST SESSION H. R. 2198

To abolish the Department of Housing and Urban Development and provide

for reducing Federal spending for housing and community development

activities by consolidating and eliminating programs, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

AUGUST 4, 1995

Mr. BROWNBACK (for himself, Mrs. MYRICK, Mr. GUTKNECHT, Mr. LARGENT,

Mr. ARMEY, Mr. DELAY, Mr. BOEHNER, Mr. ROBERTS, Mr. WALKER,

Mr. KASICH, Mr. BLILEY, Mr. SOLOMON, Mr. SAXTON, Mr. DREIER, Mr.

DORNAN, Mr. ROHRABACHER, Mr. MILLER of Florida, Mr. HOEKSTRA,

Mr. SHADEGG, Mr. SCARBOROUGH, Mr. FOLEY, Mr. SOUDER, Mr.

TIAHRT, Mr. CHRYSLER, Mr. CHRISTENSEN, Mr. COOLEY, Mrs. SMITH

of Washington, Mr. TATE, Mr. SMITH of Michigan, Mr. HEFLEY, Mr.

HASTINGS of Washington, Mr. NUSSLE, Mr. INGLIS of South Carolina,

Mr. NORWOOD, Mr. STOCKMAN, Mrs. SEASTRAND, Mr. TALENT, Mr.

SANFORD, Mr. SALMON, Mr. BONO, Mrs. CHENOWETH, Mr. MCINTOSH,

Mr. HOSTETTLER, Mr. FUNDERBURK, Mr. COBURN, Mr. GRAHAM, Mr.

HILLEARY, Mr. HUTCHINSON, Mr. BASS, Mr. CUNNINGHAM, Mr.

RADANOVICH, Mr. PARKER, Mr. DOOLITTLE, Mr. HERGER, Mr. KOLBE,

Mr. WHITE, and Mr. HAYWORTH) introduced the following bill; which

was referred to the Committee on Banking and Financial Services, and

in addition to the Committee on Government Reform and Oversight, for

a period to be subsequently determined by the Speaker, in each case for

consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To abolish the Department of Housing and Urban Development and provide for reducing Federal spending for
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housing and community development activities by consolidating and eliminating programs, and for other purposes.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Housing Opportunities

5 and Empowerment Act’’.

6 SEC. 2. TABLE OF CONTENTS.

7 The table of contents for this Act is as follows:

Sec. 1. Short title.

Sec. 2. Table of contents.

TITLE I—ABOLISHMENT OF DEPARTMENT OF HOUSING AND

URBAN DEVELOPMENT AND DISPOSITION OF FUNCTIONS

Subtitle A—Abolishment of Department of Housing and Urban Development

Sec. 101. Reestablishment of Department as Housing and Urban Development

Programs Resolution Agency.

Sec. 102. Functions.

Sec. 103. Continuation of service of HUD officers.

Sec. 104. Reorganization.

Sec. 105. Abolishment of Resolution Agency.

Sec. 106. GAO report.

Sec. 107. Conforming amendments.

Sec. 108. Effective date.

Subtitle B—Disposition of Particular Programs, Functions, and Agencies of

Department of Housing and Urban Development

Sec. 121. Program transfers.

Sec. 122. Reestablishment of Office of Federal Housing Enterprise Oversight

as independent office in Department of the Treasury.

Sec. 123. Termination of Government National Mortgage Association.

Sec. 124. Abolishment of Office of Public Affairs.

Sec. 125. Effective date.

Subtitle C—Miscellaneous Provisions

Sec. 141. References.

Sec. 142. Exercise of authorities.

Sec. 143. Savings provisions.

Sec. 144. Transfer of assets.

Sec. 145. Delegation and assignment.

Sec. 146. Authority of Office of Management and Budget with respect to functions transferred.
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Sec. 147. Proposed changes in law.

Sec. 148. Definition of transfer.

Sec. 149. Definitions.

TITLE II—TENANT-BASED VOUCHERS FOR RENTAL AND

HOMEOWNERSHIP ASSISTANCE

Subtitle A—Block Grants for State Housing Voucher Assistance

Sec. 201. Federal assistance for State voucher program.

Sec. 202. Block grants.

Sec. 203. State voucher program requirements.

Sec. 204. Waiver of voucher program requirements and flexible use of grant

amounts.

Sec. 205. Remedies for noncompliance.

Sec. 206. Administrative fee.

Sec. 207. Monitoring.

Subtitle B—Federal Housing Voucher Assistance Program

Sec. 221. Program authority.

Sec. 222. Eligible families.

Sec. 223. Amount of assistance payment.

Sec. 224. Payment standard and fair market rentals.

Sec. 225. Eligible dwelling units.

Sec. 226. Rents.

Sec. 227. Leases.

Sec. 228. Preferences for assistance.

Sec. 229. Portability.

Sec. 230. Use of housing assistance for homeownership.

Sec. 231. Annual contributions contracts.

Sec. 232. Housing voucher contracts.

Sec. 233. Administrative fee.

Sec. 234. Local voucher assistance agencies.

Sec. 235. Definitions.

Subtitle C—Determination of State Allocations and Election of Federal or

State Voucher Program

Sec. 251. State allocations.

Sec. 252. Availability of State allocation based on election to use Federal or

State voucher program.

Subtitle D—Office of Federal Housing Voucher Assistance in Department of

Health and Human Services

Sec. 261. Establishment.

Sec. 262. Voucher Administrator.

Sec. 263. Duty and authority of Voucher Administrator.

Sec. 264. Transfer of certain personnel.

Sec. 265. Reports.

Sec. 266. GAO audits.

Sec. 267. Regulations.

Sec. 268. Effective date.

Subtitle E—General Provisions

Sec. 281. Definitions.
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Sec. 282. Maximum amount of housing assistance.

Sec. 283. Authorization of appropriations.

TITLE III—TRANSITION PROVISIONS RELATING TO REPLACEMENT OF PUBLIC HOUSING AND ASSISTED HOUSING PROGRAMS

Sec. 301. Purpose.

Subtitle A—Replacement of Assisted Housing Programs

Sec. 311. Termination of existing programs.

Sec. 312. Transition to voucher assistance program.

Sec. 313. Transfer of residual HUD authority to administrator of Federal

Housing Voucher Assistance.

Sec. 314. Treatment of families assisted under terminated programs.

Sec. 315. Continued restrictions on use of existing public housing stock.

Sec. 316. Audit of project-based section 8 assistance contracts.

Subtitle B—Interim Program for Public Housing Block Grants and

Deregulation

Sec. 321. Immediate termination of existing public housing programs.

Sec. 322. Program authority.

Sec. 323. Strategic plan.

Sec. 324. Consolidation of funding.

Sec. 325. Public Housing Block Grant Fund.

Sec. 326. Grants.

Sec. 327. Eligible activities.

Sec. 328. Formula allocations.

Sec. 329. Program requirements and waivers.

Sec. 330. Authorization of appropriations.

Subtitle C—General Provisions

Sec. 341. Definitions.

TITLE IV—BLOCK GRANTS FOR HOUSING AND COMMUNITY

DEVELOPMENT OPPORTUNITIES

Subtitle A—Block Grants Program

Sec. 401. Purpose.

Sec. 402. General block grants.

Sec. 403. Eligible States and entitlement areas.

Sec. 404. Use of grant amounts.

Sec. 405. Block grant plan.

Sec. 406. Allocation of block grant amounts.

Subtitle B—Block Grants for Housing for Special Populations and Indian

Housing

Sec. 421. Block grants for housing for special populations.

Sec. 422. Block grants for Indian housing.

Subtitle C—General Provisions Relating to Block Grants

Sec. 431. Oversight.

Sec. 432. Remedies for noncompliance.
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Sec. 433. Nondiscrimination.

Sec. 434. Definitions.

Sec. 435. Regulations.

Sec. 436. Funding.

Sec. 437. Repeals.

Subtitle D—Housing and Community Opportunities Agency

Sec. 441. Establishment.

Sec. 442. Director.

Sec. 443. Duties.

Sec. 444. Personnel.

Sec. 445. Administrative provisions.

Sec. 446. Report.

Subtitle E—Effective Date

Sec. 451. Effective date.

TITLE V—SINGLE FAMILY HOUSING MORTGAGE INSURANCE

Subtitle A—Federal Home Mortgage Insurance Program

Sec. 501. Federal Home Mortgage Insurance Fund.

Sec. 502. Authority to enter into risk-sharing agreements for mortgage insurance coverage.

Sec. 503. Qualified mortgages.

Sec. 504. Insurance coverage.

Sec. 505. Risk-sharing agreements.

Sec. 506. Requirements for qualified mortgage insurers.

Sec. 507. Definitions.

Sec. 508. Limitation on commitments to insure mortgages.

Subtitle B—Federal Home Mortgage Insurance Fund Administration

Sec. 531. Establishment.

Sec. 532. Fund Administrator.

Sec. 533. Duty and authority of Fund Administrator.

Sec. 534. Personnel.

Sec. 535. Reports.

Sec. 536. GAO audits and reports.

Sec. 537. Regulations.

Sec. 538. Authorization of appropriations for administrative expenses.

Subtitle C—Transition Provisions

Sec. 551. Prohibition of new FHA business.

Sec. 552. Repeal of FHA insurance authority.

Sec. 553. Sale of FHA assets.

Sec. 554. Transfer of remaining FHA authority to administrator of Federal

Home Mortgage Insurance Fund.

Sec. 555. Definitions.

Subtitle D—General and Miscellaneous Provisions

Sec. 571. Amendments to title 5, United States Code.

Sec. 572. Authority of Director of OFHEO to monitor safety and soundness of

Fund.
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Sec. 573. Definitions.

Sec. 574. Effective date.

TITLE VI—OFFICE OF FEDERALISM IN OFFICE OF MANAGEMENT

AND BUDGET

Sec. 601. Establishment.

Sec. 602. Administrator.

Sec. 603. Functions of Administrator.

Sec. 604. Authorization of appropriations.

Sec. 605. Compensation of Administrator at level III of Executive Schedule.

Sec. 606. Effective date.

1 TITLE I—ABOLISHMENT OF DE2 PARTMENT OF HOUSING AND

3 URBAN DEVELOPMENT AND

4 DISPOSITION OF FUNCTIONS

5 Subtitle A—Abolishment of Depart6 ment of Housing and Urban De7 velopment

8 SEC. 101. REESTABLISHMENT OF DEPARTMENT AS HOUS9 ING AND URBAN DEVELOPMENT PROGRAMS

10 RESOLUTION AGENCY.

11 (a) REESTABLISHMENT OF DEPARTMENT.—The De12 partment of Housing and Urban Development is hereby

13 redesignated as the Housing and Urban Development Pro14 grams Resolution Agency, which shall be an independent

15 agency in the executive branch of the Government.

16 (b) RESOLUTION ADMINISTRATOR.—

17 (1) IN GENERAL.—There shall be at the head

18 of the Agency an Administrator of the Agency, who

19 shall be appointed by the President, by and with the

20 advice and consent of the Senate. The agency shall
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1 be administered under the supervision and direction

2 of the Resolution Administrator. The Resolution Ad3 ministrator shall receive compensation at the rate

4 prescribed for level III of the Executive Schedule

5 under section 5314 of title 5, United States Code.

6 (2) INITIAL APPOINTMENT.—Notwithstanding

7 any other provision of this title or any other law, the

8 President may, at any time after the date of the en9 actment of this Act, appoint an individual to serve

10 as Resolution Administrator (who may be the Sec11 retary of Housing and Urban Development), as such

12 position is established under paragraph (1). An ap13 pointment under this paragraph may not be con14 strued to affect the position of Secretary of Housing

15 and Urban Development or the authority of such

16 Secretary before the effective date under section

17 108(a).

18 (c) DUTIES OF RESOLUTION ADMINISTRATOR.—The

19 Resolution Administrator shall be responsible for—

20 (1) the administration and wind-up, during the

21 wind-up period (as such term is defined in section

22 149), of all functions of the Resolution Adminis23 trator pursuant to section 102 and titles III and V;

24 (2) the administration and wind-up, during the

25 wind-up period, of any outstanding obligations of the
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1 Federal Government under any programs terminated

2 or repealed by this Act;

3 (3) coordinating and carrying out, with the Ad4 ministrator of the Office of Federal Housing Vouch5 er Assistance, the transition under section 312; and

6 (4) taking such other actions as may be nec7 essary, before the termination date under section

8 105(d), to wind up any outstanding affairs of the

9 Department of Housing and Urban Development.

10 SEC. 102. FUNCTIONS.

11 Except to the extent that a function is abolished or

12 vested in another official or agency by this Act, the Reso13 lution Administrator shall perform all functions that, im14 mediately before the effective date under section 108(a),

15 were functions of the Department of Housing and Urban

16 Development (or any office of the Department) or were

17 authorized to be performed by the Secretary of Housing

18 and Urban Development or any other officer or employee

19 of the Department in the capacity as such officer or em20 ployee.

21 SEC. 103. CONTINUATION OF SERVICE OF HUD OFFICERS.

22 (a) CONTINUATION OF SERVICE OF SECRETARY.—

23 The individual serving as the Secretary of Housing and

24 Urban Development on the effective date under section

25 108(a) may act as Resolution Administrator until the date
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1 an individual is appointed under this title to the position

2 of Resolution Administrator, or until the end of the 120-

3 day period provided for in section 3348 of title 5, United

4 States Code (relating to limitations on the period of time

5 a vacancy may be filled temporarily), whichever is earlier.

6 (b) COMPENSATION FOR CONTINUED SERVICE.—Any

7 person who serves as the Resolution Administrator under

8 subsection (a) after the effective date under section 108(a)

9 and before the first appointment of a person to such posi10 tion after such date shall continue to be compensated for

11 so serving or acting at the rate at which such person was

12 compensated before such effective date.

13 SEC. 104. REORGANIZATION.

14 The Resolution Administrator may allocate or reallo15 cate any function of the Agency pursuant to this Act

16 among the officers of the Agency, and may establish, con17 solidate, alter, or discontinue in the Housing and Urban

18 Development Programs Resolution Agency any organiza19 tional entities that were entities of the Department of

20 Housing and Urban Development, as the Resolution Ad21 ministrator considers necessary or appropriate.

22 SEC. 105. ABOLISHMENT OF RESOLUTION AGENCY.

23 (a) IN GENERAL.—Effective on the termination date

24 under subsection (d), the Housing and Urban Develop25 ment Programs Resolution Agency is abolished.
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1 (b) ABOLITION OF FUNCTIONS.—Except for func2 tions transferred or otherwise continued by this Act, all

3 functions that, immediately before the termination date,

4 were functions of the Housing and Urban Development

5 Programs Resolution Agency are abolished effective on the

6 termination date.

7 (c) PLAN FOR WINDING UP AFFAIRS.—Not later

8 than the effective date under section 108(a), the President

9 shall submit to the Congress a plan for winding up the

10 affairs of the Agency in accordance with this Act and by

11 not later than the termination date.

12 (d) TERMINATION DATE.—The termination date is

13 September 30, 2000.

14 SEC. 106. GAO REPORT.

15 Not later than 180 days after the date of enactment

16 of this Act, the Comptroller General of the United States

17 shall submit to the Congress a report which shall include

18 recommendations for the most efficient means of achiev19 ing, in accordance with this Act—

20 (1) the complete abolishment of the Depart21 ment of Housing and Urban Development; and

22 (2) the termination or transfer or other con23 tinuation of the functions of the Department of

24 Housing and Urban Development.
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1 SEC. 107. CONFORMING AMENDMENTS.

2 (a) PRESIDENTIAL SUCCESSION.—Section 19(d)(1)

3 of title 3, United States Code, is amended by striking

4 ‘‘Secretary of Housing and Urban Development,’’.

5 (b) EXECUTIVE DEPARTMENTS.—Section 101 of title

6 5, United States Code, is amended by striking the follow7 ing item:

8 ‘‘The Department of Housing and Urban De9 velopment.’’.

10 (c) SECRETARY’S COMPENSATION.—Section 5312 of

11 title 5, United States Code, is amended by striking the

12 following item:

13 ‘‘Secretary of Housing and Urban Develop14 ment.’’.

15 (d) DEPUTY SECRETARY’S COMPENSATION.—Section

16 5313 of title 5, United States Code, is amended by strik17 ing the following item:

18 ‘‘Deputy Secretary of Housing and Urban De19 velopment.’’.

20 (e) INSPECTOR GENERAL’S COMPENSATION.—Sec21 tion 5315 of title 5, United States Code, is amended by

22 striking the following item:

23 ‘‘Inspector General, Department of Housing

24 and Urban Development.’’.
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1 (f) ASSISTANT SECRETARIES’, GENERAL COUNSEL’S,

2 AND CFO’S COMPENSATION.—Section 5315 of title 5,

3 United States Code, is amended—

4 (1) by striking the following item:

5 ‘‘Assistant Secretaries of Housing and Urban

6 Development (8).’’;

7 (2) by striking the following item:

8 ‘‘General Counsel of the Department of Hous9 ing and Urban Development.’’; and

10 (3) by striking the following item:

11 ‘‘Chief Financial Officer, Department of Hous12 ing and Urban Development.’’.

13 (g) DEPARTMENT OF HOUSING AND URBAN DEVEL14 OPMENT ACT.—Effective on the termination date, the De15 partment of Housing and Urban Development Act (42

16 U.S.C. 3531 et seq.) is repealed.

17 SEC. 108. EFFECTIVE DATE.

18 (a) IN GENERAL.—Except as provided in subsection

19 (b), this subtitle shall take effect, and the amendments

20 under this subtitle shall be made and shall apply, on Octo21 ber 1, 1995.

22 (b) PROVISIONS EFFECTIVE ON DATE OF ENACT23 MENT.—The following provisions of this subtitle shall take

24 effect on the date of the enactment of this Act:

25 (1) Section 101(b).
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1 (2) Section 105(c).

2 (3) Section 106.

3 Subtitle B—Disposition of Particu4 lar Programs, Functions, and

5 Agencies of Department of

6 Housing and Urban Develop7 ment

8 SEC. 121. PROGRAM TRANSFERS.

9 (a) TRANSFER OF FUNCTIONS.—The functions that,

10 immediately before the effective date under section 108(a),

11 were performed by the Secretary of Housing and Urban

12 Development are hereby transferred, as follows:

13 (1) FAIR HOUSING ACT.—All such functions re14 lating to the Fair Housing Act, rights guaranteed

15 under the Fair Housing Act, and the Fair Housing

16 Assistance program under such Act (not including

17 any functions relating to the Fair Housing Initia18 tives program under section 561 of the Housing and

19 Community Development Act of 1987), are trans20 ferred to the Attorney General of the United States.

21 (2) INTERSTATE LAND SALES FULL DISCLO22 SURE ACT.—All such functions relating to the Inter23 state Land Sales Full Disclosure Act are transferred

24 to the Federal Trade Commission.
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1 (3) REAL ESTATE SETTLEMENT PROCEDURES

2 ACT OF 1974.—All functions relating to the Real Es3 tate Settlement Procedures Act of 1974 are trans4 ferred to the Board of Governors of the Federal Re5 serve System.

6 (4) MANUFACTURED HOME STANDARDS.—All

7 such functions relating to the National Manufac8 tured Housing Construction and Safety Standards

9 Act of 1974 are transferred to the Administrator of

10 the Rural Housing and Community Development

11 Service of the Department of Agriculture.

12 (5) LEAD-BASED PAINT POISONING PREVEN13 TION ACT.—All such functions relating to titles III,

14 IV, and V of the Lead-Based Paint Poisoning Pre15 vention Act are transferred to the Administrator of

16 the Environmental Protection Agency.

17 (6) RESIDENTIAL LEAD-BASED PAINT HAZARD

18 REDUCTION ACT OF 1992.—All such functions relat19 ing to sections 1015, 1016, 1017, 1018, 1051, 1052,

20 1053, and 1061 of the Housing and Community De21 velopment Act of 1992 are transferred to the Ad22 ministrator of the Environmental Protection Agency.

23 (7) HOME MORTGAGE DISCLOSURE ACT OF

24 1975.—All such functions relating to the Home
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1 Mortgage Disclosure Act of 1975 are transferred to

2 the Secretary of the Treasury.

3 (b) TRANSITION ASSISTANCE.—The head of the

4 agency or office to which a function is transferred under

5 this section may, for such period of time as may reason6 ably be necessary to facilitate the orderly implementation

7 of this section, utilize the services of officers, employees,

8 and other personnel of the Housing and Urban Develop9 ment Programs Resolution Agency with respect to func10 tions transferred to the agency or office by this section.

11 SEC. 122. REESTABLISHMENT OF OFFICE OF FEDERAL

12 HOUSING ENTERPRISE OVERSIGHT AS INDE13 PENDENT OFFICE IN DEPARTMENT OF THE

14 TREASURY.

15 (a) REESTABLISHMENT.—The Office of Federal

16 Housing Enterprise Oversight of the Department of Hous17 ing and Urban Development (in this section referred to

18 as the ‘‘Office) is hereby reestablished as an office in the

19 Department of the Treasury.

20 (b) CONTINUATION OF SERVICE AND COMPENSATION

21 OF DIRECTOR.—The individual serving as the Director of

22 the Office on the effective date under section 108(a) may

23 act as Director of the Office as reestablished under this

24 section for the remainder of the term for which such per25 son was appointed.
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1 (c) FUNCTIONS.—All functions relating to safety and

2 soundness of the enterprises (as such term is defined in

3 section 1303 of the Housing and Community Development

4 Act of 1992) that, immediately before the effective date

5 under section 108(a), were performed by the Secretary of

6 Housing and Urban Development (including the functions

7 under part 2 of subtitle A of title XIII of such Act, the

8 Federal National Mortgage Association Charter Act, and

9 the Federal Home Loan Mortgage Corporation Act) shall

10 be functions of the Secretary of the Treasury.

11 (d) PERSONNEL.—

12 (1) IN GENERAL.—The personnel employed in

13 connection with the functions referred to in sub14 section (c) shall be personnel of the Office as rees15 tablished by this section.

16 (2) EFFECT.—Any full-time or part-time per17 sonnel employed in permanent positions shall not be

18 separated or reduced in grade or compensation be19 cause of the reestablishment of the Office under this

20 section during the 1-year period beginning on the ef21 fective date under section 108(a).

22 (e) AMENDMENTS TO TITLE XIII OF HOUSING AND

23 COMMUNITY DEVELOPMENT ACT OF 1992.—Title XIII of

24 the Housing and Community Development Act of 1992

25 is amended—
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1 (1) in section 1303 (12 U.S.C. 4502)—

2 (A) in paragraphs (5) and (14), by striking

3 ‘‘Department of Housing and Urban Develop4 ment’’ each place it appears and inserting ‘‘De5 partment of the Treasury’’; and

6 (B) by striking paragraph (15) and insert7 ing the following new paragraph:

8 ‘‘(15) SECRETARY.—Except as specifically pro9 vided otherwise, the term ‘Secretary’ means the Sec10 retary of the Treasury.’’;

11 (2) in section 1311 (12 U.S.C. 4511)—

12 (A) by striking ‘‘Department of Housing

13 and Urban Development’’ and inserting ‘‘De14 partment of the Treasury’’; and

15 (B) by adding at the end the following new

16 sentences: ‘‘Notwithstanding any other provi17 sion of this Act, the Secretary of the Treasury

18 may not merge or consolidate the Office of Fed19 eral Housing Enterprise Oversight of the De20 partment, or any of the functions or respon21 sibilities of such Office, with any other function

22 or program administered by the Secretary. Any

23 reference in any other Federal law, any Execu24 tive order, rule, regulation, or delegation of au25 thority, or any document of or pertaining to the
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1 Office of Federal Housing Enterprise Oversight

2 of the Department of Housing and Urban De3 velopment (1) to such Office, is deemed to refer

4 to the Office of Federal Housing Enterprise

5 Oversight of the Department of the Treasury,

6 and (2) to the Director of such Office or an

7 officer of such office, is deemed to refer to the

8 Director of the Office of Federal Housing En9 terprise Oversight of the Department of the

10 Treasury or an officer of such office.’’;

11 (3) in section 1315(d) (12 U.S.C. 4515(d))—

12 (A) in the subsection heading, by striking

13 ‘‘HUD’’ and inserting ‘‘TREASURY DEPART14 MENT’’; and

15 (B) by striking ‘‘Department of Housing

16 and Urban Development’’ and inserting ‘‘De17 partment of the Treasury’’;

18 (4) in section 1316(g)(3) (12 U.S.C.

19 4516(g)(3))—

20 (A) by striking ‘‘(A)’’; and

21 (B) by striking, ‘‘and (B)’’ and all that fol22 lows through ‘‘Secretary’’;

23 (5) in section 1319F(2) (12 U.S.C. 4525(2)),

24 by striking ‘‘Department of Housing and Urban De-
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1 velopment’’ and inserting ‘‘Department of the Treas2 ury’’;

3 (6) in section 1319G(a) (12 U.S.C. 4526(a)),

4 by striking the last sentence; and

5 (7) by striking the designation and heading for

6 part 2 of subtitle A and inserting the following:

7 ‘‘PART 2—AUTHORITY OF SECRETARY OF

8 HOUSING AND URBAN DEVELOPMENT

9 ‘‘SEC. 1320. DEFINITION OF SECRETARY.

10 ‘‘For purposes of this part, the term ‘Secretary’

11 means the Secretary of Housing and Urban Develop12 ment.’’.

13 (f) AMENDMENTS TO TITLE 5, UNITED STATES

14 CODE.—

15 (1) COMPENSATION.—Section 5313 of title 5,

16 United States Code, is amended by striking the item

17 relating to the Director of the Office of Federal

18 Housing Enterprise Oversight, Department of Hous19 ing and Urban Development, and inserting the fol20 lowing new item:

21 ‘‘Director of the Office of Federal Housing En22 terprise Oversight, Department of the Treasury.’’.

23 (2) EXCLUSION FROM SENIOR EXECUTIVE

24 SERVICE.—Section 3132(a)(1)(D) of title 5, United

25 States Code, is amended by striking ‘‘Department of
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1 Housing and Urban Development’’ and inserting

2 ‘‘Department of the Treasury’’.

3 (g) CLERICAL AMENDMENT.—The table of contents

4 in section 1(b) of the Housing and Community Develop5 ment Act of 1992 (Public Law 102–550; 106 Stat. 3679)

6 is amended by striking the item relating to part 2 of sub7 title A and inserting the following new items:

‘‘PART 2—AUTHORITY OF SECRETARY OF HOUSING AND URBAN

DEVELOPMENT

‘‘Sec. 1320. Definition of Secretary.’’.

8 SEC. 123. TERMINATION OF GOVERNMENT NATIONAL

9 MORTGAGE ASSOCIATION.

10 (a) TERMINATION.—Section 302(a)(2)(A) of the Na11 tional Housing Act (12 U.S.C. 1717(a)(2)(A)) is amended

12 by adding at the end the following new sentences: ‘‘Upon

13 the effective date under section 125 of the Housing Oppor14 tunities and Empowerment Act, the body corporate de15 scribed in this subparagraph shall cease to exist. Upon

16 such effective date, any authority of the Department of

17 Housing and Urban Development under this Act or any

18 other Act to carry out duties and functions of the Associa19 tion shall terminate. On and after such effective date, the

20 Administrator of the Housing and Urban Development

21 Programs Resolution Agency may exercise the authority

22 of the Secretary of Housing and Urban Development to

23 carry out duties and functions of the Association, but only
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1 to the extent necessary to fulfill outstanding obligations

2 of the Association and windup the business of the Associa3 tion (as provided in the plan established pursuant to sec4 tion 123(b) of such Act) and only until such time as such

5 authority is terminated (as provided by such plan). Such

6 Administrator may not guarantee, or make any commit7 ment to guarantee, any securities or notes based on or

8 backed by mortgages or otherwise engage in any new busi9 ness based on any authority of the Association.’’.

10 (b) PHASE-OUT PLAN.—The Resolution Adminis11 trator shall establish a plan for winding up the affairs of

12 the Government National Mortgage Association (in this

13 section referred to as the ‘‘Association’’). The plan—

14 (1) shall provide that the Association shall ter15 minate upon the effective date under section 125;

16 (2) shall provide for the Resolution Adminis17 trator to exercise the authority of the Secretary of

18 Housing and Urban Development to carry out duties

19 and functions of the Association, but only to the ex20 tent necessary to fulfill outstanding obligations of

21 the Association and windup the business of the As22 sociation;

23 (3) may provide for the Federal National Mort24 gage Association or the Federal Home Loan Mort25 gage Corporation or other private secondary mort-
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1 gage market entities, as the Secretary considers ap2 propriate, to assume any secondary market functions

3 of the Association or similar functions;

4 (4) shall include any recommendations for legis5 lation that may be necessary for carrying out the

6 amendment made by subsection (a) and the plan

7 under this subsection; and

8 (5) shall provide for any authority of the Reso9 lution Administrator under paragraph (2) to termi10 nate as soon as possible, but in no event later than

11 the termination date.

12 The Resolution Administrator shall submit a copy of the

13 plan under this section to the Congress not later than the

14 expiration of the 12-month period beginning on the date

15 of the enactment of this Act.

16 SEC. 124. ABOLISHMENT OF OFFICE OF PUBLIC AFFAIRS.

17 The Office of Public Affairs of the Department of

18 Housing and Urban Development is abolished and shall

19 not be a function of the Housing and Urban Development

20 Programs Resolution Agency pursuant to section 102.

21 SEC. 125. EFFECTIVE DATE.

22 This subtitle shall take effect, and the amendments

23 under this subtitle shall be made and shall apply, on the

24 effective date specified in section 108(a).
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1 Subtitle C—Miscellaneous

2 Provisions

3 SEC. 141. REFERENCES.

4 Any reference in any other Federal law, Executive

5 order, rule, regulation, or delegation of authority, or any

6 document of or pertaining to an office from which a func7 tion is transferred by this Act—

8 (1) to the Secretary of Housing and Urban De9 velopment or an officer of the Department of Hous10 ing and Urban Development, is deemed to refer to

11 the head of the department or office to which such

12 function is transferred; and

13 (2) to the Department of Housing and Urban

14 Development is deemed to refer to the department

15 or office to which such function is transferred.

16 SEC. 142. EXERCISE OF AUTHORITIES.

17 Except as otherwise provided by law, a Federal offi18 cial to whom a function is transferred by this Act may,

19 for purposes of performing the function, exercise all au20 thorities under any other provision of law that were avail21 able with respect to the performance of that function to

22 the official responsible for the performance of the function

23 immediately before the effective date of the transfer of the

24 function.
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1 SEC. 143. SAVINGS PROVISIONS.

2 (a) LEGAL DOCUMENTS.—All orders, determinations,

3 rules, regulations, permits, grants, loans, contracts, agree4 ments, certificates, licenses, and privileges—

5 (1) that have been issued, made, granted, or al6 lowed to become effective by the President, the Sec7 retary of Housing and Urban Development, any offi8 cer or employee of any office transferred or reestab9 lished by this Act, or any other Government official,

10 or by a court of competent jurisdiction, in the per11 formance of any function that is transferred by this

12 Act, and

13 (2) that are in effect on the effective date of

14 such transfer (or become effective after such date

15 pursuant to their terms as in effect on such effective

16 date),

17 shall continue in effect according to their terms until

18 modified, terminated, superseded, set aside, or revoked in

19 accordance with law by the President, any other author20 ized official, a court of competent jurisdiction, or operation

21 of law.

22 (b) PROCEEDINGS.—This Act shall not affect any

23 proceedings or any application for any benefits, service,

24 license, permit, certificate, or financial assistance pending

25 on the date of the enactment of this Act before an agency

26 or office transferred by this Act, but such proceedings and
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1 applications shall be continued. Orders shall be issued in

2 such proceedings, appeals shall be taken therefrom, and

3 payments shall be made pursuant to such orders, as if this

4 Act had not been enacted, and orders issued in any such

5 proceeding shall continue in effect until modified, termi6 nated, superseded, or revoked by a duly authorized official,

7 by a court of competent jurisdiction, or by operation of

8 law. Nothing in this subsection shall be considered to pro9 hibit the discontinuance or modification of any such pro10 ceeding under the same terms and conditions and to the

11 same extent that such proceeding could have been discon12 tinued or modified if this Act had not been enacted.

13 (c) SUITS.—This Act shall not affect suits com14 menced before the date of the enactment of this Act, and

15 in all such suits, proceeding shall be had, appeals taken,

16 and judgments rendered in the same manner and with the

17 same effect as if this Act had not been enacted.

18 (d) NONABATEMENT OF ACTIONS.—No suit, action,

19 or other proceeding commenced by or against the Depart20 ment of Housing and Urban Development or the Secretary

21 of Housing and Urban Development, or by or against any

22 individual in the official capacity of such individual as an

23 officer or employee of an office transferred or reestab24 lished by this Act, shall abate by reason of the enactment

25 of this Act.
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1 (e) CONTINUANCE OF SUITS.—If any officer of the

2 Department of Housing and Urban Development in the

3 official capacity of such officer is a party to a suit with

4 respect to the function of the officer, and under this Act

5 such function is transferred to any other officer or office,

6 then such suit shall be continued with the other officer

7 or the head of such other office, as applicable, substituted

8 or added as a party.

9 SEC. 144. TRANSFER OF ASSETS.

10 Except as otherwise provided in this Act, so much

11 of the personnel, property, records, and unexpended bal12 ances of appropriations, allocations, and other funds em13 ployed, used, held, available, or to be made available in

14 connection with a function transferred to an official by

15 this Act shall be available to the official at such time or

16 times as the Director of the Office of Management and

17 Budget directs for use in connection with the functions

18 transferred.

19 SEC. 145. DELEGATION AND ASSIGNMENT.

20 Except as otherwise provided in this Act or otherwise

21 expressly prohibited by law, an official to whom functions

22 are transferred under this Act (including the head of any

23 officer to which functions are transferred) may delegate

24 any of the functions so transferred to such officers and

25 employees of the agency or office of such official as the
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1 official may designate, and may authorize successive

2 redelegations of such functions as may be necessary or ap3 propriate. No delegation of functions under this section

4 or under any other provision of this Act shall relieve the

5 official to whom a function is transferred under this Act

6 of responsibility for the administration of the function.

7 SEC. 146. AUTHORITY OF OFFICE OF MANAGEMENT AND

8 BUDGET WITH RESPECT TO FUNCTIONS

9 TRANSFERRED.

10 (a) DETERMINATIONS.—If necessary, the Office of

11 Management and Budget shall make any determination of

12 the functions that are transferred under this Act.

13 (b) INCIDENTAL TRANSFERS.—The Director of the

14 Office of Management and Budget, at such time or times

15 as the Director shall provide, may make such incidental

16 dispositions of personnel, assets, liabilities, grants, con17 tracts, property, records, and unexpended balances of ap18 propriations, authorizations, allocations, and other funds

19 held, used, arising from, available to, or to be made avail20 able in connection with such functions, as may be nec21 essary to carry out the provisions of this Act.

22 (c) TERMINATIONS.—The Director of the Office of

23 Management and Budget shall provide for the termination

24 of the affairs of all entities terminated and for such fur-
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1 ther measures and dispositions as may be necessary to ef2 fectuate the purposes of this Act.

3 SEC. 147. PROPOSED CHANGES IN LAW.

4 Not later than one year after the date of the enact5 ment of this Act, the Director of the Office of Manage6 ment and Budget shall submit to the Congress a descrip7 tion of any changes in Federal law necessary to reflect

8 abolishments, transfers, reestablishments, terminations,

9 and disposals under this Act.

10 SEC. 148. DEFINITION OF TRANSFER.

11 For purposes of this title, the vesting of a function

12 in a department or office pursuant to reestablishment of

13 an office shall be considered to be the transfer of the func14 tion.

15 SEC. 149. DEFINITIONS.

16 For purposes of this title, the following definitions

17 shall apply:

18 (1) FUNCTION.—The term ‘‘function’’ includes

19 any duty, obligation, power, authority, responsibility,

20 right, privilege, activity, or program.

21 (2) OFFICE.—The term ‘‘office’’ includes any

22 office, administration, agency, institute, council,

23 unit, organizational entity, or component thereof.

24 (3) RESOLUTION ADMINISTRATOR.—The term

25 ‘‘Resolution Administrator’’ means the Adminis-
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1 trator of the Housing and Urban Development Pro2 grams Resolution Agency.

3 (4) TERMINATION DATE.—The term ‘‘termi4 nation date’’ means the termination date under sec5 tion 105(d).

6 (5) WIND-UP PERIOD.—The term ‘‘wind-up pe7 riod’’ means the period beginning on the effective

8 date under section 108(a) and ending on the termi9 nation date.

10 TITLE II—TENANT-BASED

11 VOUCHERS FOR RENTAL AND

12 HOMEOWNERSHIP ASSIST13 ANCE

14 Subtitle A—Block Grants for State

15 Housing Voucher Assistance

16 SEC. 201. FEDERAL ASSISTANCE FOR STATE VOUCHER PRO17 GRAM.

18 (a) AUTHORITY AND PURPOSE.—For fiscal year

19 1996 and thereafter, the Administrator of the Federal

20 Housing Voucher Agency (appointed pursuant to subtitle

21 D) shall make assistance under this subtitle available to

22 each eligible State (in the amount of the allocation deter23 mined under section 251 for the State) for the purpose

24 of providing housing voucher assistance on behalf of low-
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1 income families for the rental or ownership of existing

2 dwelling units by such families.

3 (b) ELIGIBLE STATES.—For purposes of this sub4 title, the term ‘‘eligible State’’ means a State that has pro5 vided notice under section 252.

6 SEC. 202. BLOCK GRANTS.

7 Assistance under this subtitle for an eligible State

8 shall be provided in the form of a grant to the State for

9 a fiscal year, which may be used only (except as provided

10 in section 204)—

11 (1) to provide housing voucher assistance in ac12 cordance with the requirements of section 203; and

13 (2) to the extent authorized in section 206, for

14 administrative costs of providing such voucher as15 sistance.

16 SEC. 203. STATE VOUCHER PROGRAM REQUIREMENTS.

17 (a) IN GENERAL.—With respect to a grant under this

18 subtitle to an eligible State, housing voucher assistance

19 in accordance with the requirements of this section is fi20 nancial assistance that complies with the following re21 quirements:

22 (1) HOUSING USE.—The assistance shall be

23 available only to cover rental or ownership expenses

24 of a dwelling unit that is the primary residence of

25 the individual, household, or family to or on behalf
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1 of whom the assistance is provided and is located

2 within the State to which the grant is made.

3 (2) INDIVIDUAL ASSISTANCE.—The assistance

4 shall be provided to or on behalf of particular indi5 viduals, households, or families who are determined

6 to be eligible for such assistance based on the in7 come, resources, or financial need of the individual,

8 household, or family, subject to the limitation under

9 paragraphs (3) and (5).

10 (3) LOW-INCOME USE.—The assistance shall

11 not be available to or for any individual, household,

12 or family whose annual income exceeds the median

13 income for the area, as such median income is deter14 mined by the Voucher Administrator for purposes of

15 the Federal housing voucher assistance program

16 under subtitle B, with adjustments for smaller and

17 larger families.

18 (4) AMOUNT OF ASSISTANCE.—The amount of

19 assistance provided to or on behalf of an individual,

20 household, or family shall be determined based on

21 the income, resources, or financial need of the indi22 vidual, household, or family.

23 (5) DURATION OF ASSISTANCE.—Assistance

24 may not be provided for any individual, household,

25 or family for more than a specific number of
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1 months, as shall be established by the State taking

2 into consideration any limitations on the duration of

3 eligibility of individuals, households, or families for

4 general welfare assistance under any such program

5 of the State.

6 (6) ELIGIBLE HOUSING.—The assistance may

7 not be used for the rental or occupancy of a dwelling

8 unit that fails to comply with any applicable State

9 or local laws, standards, or codes relating to housing

10 construction or condition, or fails to comply with

11 such other requirements as the State may, in its dis12 cretion, establish.

13 (7) CHOICE OF HOUSING.—Among dwelling

14 units for which the assistance is eligible to be used,

15 the choice of the dwelling unit for which the assist16 ance is used shall be solely within the discretion of

17 the family to whom or on behalf of whom the assist18 ance is provided.

19 (b) ADMINISTRATION.—The provision of housing

20 voucher assistance using grant amounts under this sub21 title shall be administered by the eligible State receiving

22 the grant, a political subdivision of the State, or any other

23 public or private entity selected or authorized by the State.
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1 SEC. 204. WAIVER OF VOUCHER PROGRAM REQUIREMENTS

2 AND FLEXIBLE USE OF GRANT AMOUNTS.

3 (a) IN GENERAL.—Pursuant to a request by a State

4 that meets the requirements under this section, the Vouch5 er Administrator shall waive the requirements of this sub6 title requiring use of grant amounts under this subtitle

7 for voucher assistance and authorize the State to use such

8 amounts for any affordable housing activities under sec9 tion 404(e), subject to the provisions of subsections (g),

10 (h), and (i) of section 404. A waiver under this section

11 shall be effective for the first fiscal year commencing after

12 the request is approved and each fiscal year thereafter.

13 (b) CONSISTENCY WITH STATE WELFARE PRO14 GRAM.—Affordable housing activities conducted with

15 grant amounts under this subtitle pursuant to a waiver

16 under this section for a State shall, to the extent the State

17 determines reasonable and practicable, be consistent with

18 the purposes of and requirements under the general wel19 fare assistance program of the State, including purposes

20 and requirements to engage in work or training and pro21 viding for duration of eligibility.

22 (c) WAIVER REQUEST.—A request for a waiver under

23 this section for a State shall—

24 (1) be made in writing;

25 (2) be signed by the chief executive officer of

26 the State;
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1 (3) describe how the use of the grant amounts

2 will comply with the requirement under subsection

3 (b);

4 (4) include a certification that grant amounts

5 made available to the State under this subtitle will

6 be used in compliance with subsection (a); and

7 (5) include a certification that a plan for the

8 use of any grant amounts will be made publicly

9 available prior to any use of such amounts.

10 (d) STANDARD FOR WAIVER.—The Voucher Admin11 istrator may not disapprove a request for a waiver un12 less—

13 (1) the request does not comply with the re14 quirements under subsection (c); or

15 (2) the Voucher Administrator determines that

16 the description under subsection (c)(3) evidences an

17 unreasonable inconsistency between the use of the

18 grant amounts and the purposes of and require19 ments under the general welfare assistance program

20 of the State.

21 In disapproving a request for a waiver under this section,

22 the Administrator shall inform the State of the reasons

23 for the disapproval, and such disapproval shall not affect

24 the consideration of any subsequent request by a State

25 for a waiver.
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1 (e) PROHIBITION AGAINST REVOKING WAIVER.—

2 Once the Voucher Administrator grants a waiver under

3 this section, the Voucher Administrator may not subse4 quently repeal, revoke, waive, annul, or otherwise limit or

5 nullify the waiver. This subsection shall not affect the au6 thority of the Voucher Administrator to take action under

7 section 205.

8 SEC. 205. REMEDIES FOR NONCOMPLIANCE.

9 (a) REDUCTION OR TERMINATION OF ASSISTANCE.—

10 If the Voucher Administrator finds on the record after op11 portunity for an agency hearing that a State receiving a

12 grant under this subtitle has failed to comply substantially

13 with any provision of this subtitle, the Voucher Adminis14 trator shall (notwithstanding section 201(a))—

15 (1) terminate payments under this subtitle to

16 the State; or

17 (2) reduce payments under this subtitle to the

18 State by an amount equal to the amount of such

19 payments that were not expended in accordance with

20 this subtitle.

21 (b) RESUMPTION OF ASSISTANCE.—If the Voucher

22 Administrator takes action under subsection (a) with re23 spect to a State, the Voucher Administrator shall resume

24 payments of assistance under this subtitle to the State at

25 such time that the Voucher Administrator determines the
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1 State has or will comply with the provisions of this sub2 title.

3 (c) CIVIL ACTION.—

4 (1) REFERRAL.—In lieu of, or in addition to,

5 any action authorized by subsection (a), if the

6 Voucher Administrator has reason to believe that a

7 State receiving assistance under this subtitle has

8 failed to comply substantially with any provision of

9 this subtitle, the Voucher Administrator may refer

10 the matter to the Attorney General of the United

11 States with a recommendation that an appropriate

12 civil action be instituted.

13 (2) ACTION.—Upon such a referral the Attor14 ney General may bring a civil action in any United

15 States district court having venue thereof for such

16 relief as may be appropriate, including an action to

17 recover the amount of the assistance furnished

18 under this subtitle which was not expended in ac19 cordance with this subtitle, or for mandatory or in20 junctive relief.

21 (d) CIVIL ACTION TO REVIEW OF REMEDIAL AC22 TIONS.—Any State that receives notice under subsection

23 (a) of the termination or reduction of payments under this

24 subtitle may, within 60 days after receiving such notice,

25 file with the United States Court of Appeals for the circuit
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1 in which such State is located, or in the United States

2 Court of Appeals for the District of Columbia, a petition

3 for review of the Voucher Administrator’s action. The peti4 tioner shall forthwith transmit copies of the petition to the

5 Voucher Administrator and the Attorney General of the

6 United States, who shall represent the Voucher Adminis7 trator in the litigation.

8 SEC. 206. ADMINISTRATIVE FEE.

9 (a) ESTABLISHMENT.—The Voucher Administrator

10 shall establish a fee for the costs incurred by an eligible

11 State in administering the provision of housing voucher

12 assistance in accordance with the requirements of section

13 203. From any amounts made available in a grant under

14 this subtitle for a fiscal year, the State may use an amount

15 not exceeding the fee for costs of administering such hous16 ing voucher assistance.

17 (b) LIMITATION.—A State that receives a grant

18 under this subtitle for a fiscal year may not use such grant

19 amounts for any costs (for the fiscal year) of administer20 ing the State program for housing voucher assistance in

21 an amount that exceeds the administrative fee under this

22 section for the State.

23 (c) AMOUNT.—The amount of the administrative fee

24 under subsection (a) for a State for a fiscal year shall be

25 an amount, determined by the Voucher Administrator, to
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1 be equivalent to the aggregate of the amounts of adminis2 trative fees that would have been determined under section

3 233 for local voucher assistance agencies in the State if

4 the amount allocated for the State under section 251 were

5 provided for assistance under subtitle B.

6 SEC. 207. MONITORING.

7 The Voucher Administrator may require States re8 ceiving assistance under this subtitle in any fiscal year to

9 report to the Administrator regarding the use of such

10 amounts.

11 Subtitle B—Federal Housing

12 Voucher Assistance Program

13 SEC. 221. PROGRAM AUTHORITY.

14 For fiscal years 1996 and thereafter, the Voucher

15 Administrator shall carry out a program under this sub16 title in the States that have not provided notice under sec17 tion 252, to provide housing assistance payments on a

18 monthly basis, on behalf of low-income families, to cover

19 costs incurred by such families in renting or owning exist20 ing dwelling units.

21 SEC. 222. ELIGIBLE FAMILIES.

22 (a) LOW-INCOME AND ELIGIBLE HOUSING REQUIRE23 MENTS.—Housing assistance under this subtitle may be

24 provided only on behalf of families who are low-income

25 families at the time that such assistance is made available
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1 for the families and only for the rental or ownership of

2 eligible dwelling units by such families.

3 (b) DETERMINATION OF INCOME ELIGIBILITY.—The

4 local voucher assistance agency providing housing assist5 ance under this subtitle shall be responsible for determin6 ing the eligibility of a family for housing assistance and

7 selecting the family as an assisted family. The Voucher

8 Administrator shall require each local voucher assistance

9 agency to issue each family selected as an assisted family

10 a voucher, which shall be a document that evidences such

11 selection and the commitment of the agency to provide

12 housing assistance on behalf of the family and that states

13 the terms and conditions of the housing assistance to be

14 provided on behalf of the family.

15 (c) INCOME REVIEWS.—Each local voucher assist16 ance agency shall conduct annual reviews of the incomes

17 of the families assisted under this subtitle by the agency

18 to determine eligibility for such assistance and the appro19 priate amount of such assistance.

20 (d) DURATION OF ASSISTANCE.—

21 (1) 5-YEAR LIMITATION.—Except as provided in

22 paragraph (3), a family may not be provided housing

23 assistance under this title for more than 60 months,

24 regardless of whether such months of assistance are

25 consecutive or not.
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1 (2) COUNTING.—For purposes of this section,

2 the number of months that a family shall be consid3 ered to previously have been provided assistance

4 under this title shall be equal to the number of

5 months that the longest-assisted family member re6 sided (for any portion of a month) in a household

7 assisted under this title at a time when such member

8 was 18 years of age or older.

9 (3) EXEMPTION OF ELDERLY AND DISABLED

10 FAMILIES.—The limitation under paragraph (1)

11 shall not apply to—

12 (A) elderly families and disabled families;

13 and

14 (B) other elderly persons and persons with

15 disabilities, as the Voucher Administrator may

16 provide, except that such exceptions shall be de17 signed to ensure that the benefit of the excep18 tions are derived primarily by elderly persons

19 and persons with disabilities and not by

20 nonelderly and nondisabled members of a

21 household who are not essential to their care or

22 well-being.

23 (4) LONGEST-ASSISTED FAMILY MEMBER.—For

24 purposes of paragraph (2), the term ‘‘longest-as25 sisted family member’’ means, with respect to a fam-
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1 ily, the member of the family who has resided (for

2 any portion of a month) in a household assisted

3 under this title for more months than any other

4 member of the family.

5 SEC. 223. AMOUNT OF ASSISTANCE PAYMENT.

6 (a) IN GENERAL.—Except as provided in subsection

7 (c), the amount of the monthly assistance payment on be8 half of family renting or owning an eligible dwelling unit

9 shall be the amount by which (1) the payment standard

10 established under section 224 for a dwelling unit of the

11 applicable size and located in the area in which the family

12 resides, exceeds (2) 30 percent of the monthly adjusted

13 income of the family.

14 (b) EXCLUSION OF EQUITY FROM INCOME.—In de15 termining the monthly assistance payment for a family on

16 behalf of whom housing assistance is provided under sec17 tion 230, no amount imputed from the equity of the family

18 in such dwelling unit may be included in the income of

19 the family.

20 (c) LIMITATIONS TO PREVENT EXCESSIVE ASSIST21 ANCE PAYMENTS.—The amount of the monthly assistance

22 payment on behalf of a family may not in any case ex23 ceed—

24 (1) for any family for whom 30 percent of the

25 adjusted income of the family exceeds the rent for
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1 the dwelling unit of the family (or the monthly

2 homeownership expenses for the dwelling unit owned

3 by 1 or more members of the family), 50 percent of

4 the difference between the payment standard appli5 cable to the dwelling unit and the actual rent

6 charged by the owner for the assisted dwelling unit;

7 (2) for any family renting an eligible dwelling

8 unit using housing assistance, the amount by which

9 the rent for the dwelling unit (including the amount

10 allowed for utilities in the case of a unit with sepa11 rate utility metering) exceeds 10 percent of the

12 monthly income of the family; or

13 (3) for any family residing in a dwelling unit

14 owned by 1 or more members of the family, the

15 amount by which the monthly homeownership ex16 penses, as determined in accordance with require17 ments established by the Voucher Administrator, ex18 ceed 10 percent of the monthly income of the family.

19 (d) RETURN OF CERTAIN SAVINGS TO FEDERAL

20 TREASURY.—Any local voucher assistance agency that

21 makes assistance payments in a fiscal year on behalf of

22 a family described in subsection (c)(1) shall reserve from

23 amounts made available to the agency for such year an

24 amount equal to 50 percent of the difference referred to

25 in such subsection. The Voucher Administrator shall, at
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1 the end of such fiscal year, recapture any amounts so re2 served and such amounts shall be covered into the General

3 Fund of the Treasury of the United States.

4 SEC. 224. PAYMENT STANDARD AND FAIR MARKET RENT5 ALS.

6 (a) ESTABLISHMENT.—The amount of housing as7 sistance under this subtitle to be provided monthly on be8 half of low-income families shall be determined using pay9 ment standards under this section. The payment stand10 ards shall be based on fair market rentals established

11 under subsection (b) and shall be established by housing

12 market area for various sizes and types of existing rental

13 dwelling units.

14 (b) FAIR MARKET RENTALS.—

15 (1) ESTABLISHMENT.—The Voucher Adminis16 trator shall provide for an independent entity to es17 tablish fair market rentals, by housing market area,

18 for various sizes and types of existing rental dwelling

19 units that are eligible dwelling units (as such term

20 is defined in section 225(b)). For a market area, the

21 fair market rental for a dwelling unit of a particular

22 size and type in the market area shall be a dollar

23 amount that reflects the rental amount for a stand24 ard quality rental unit of such size and type in the

25 market area that is an eligible dwelling unit.
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1 (2) ANNUAL ADJUSTMENT.—The Voucher Ad2 ministrator shall provide for the independent entity

3 responsible for establishing fair market rentals to

4 annually adjust each fair market rental in effect

5 under this subsection, to be effective on October 1,

6 to the extent that changes in rents for existing rent7 al dwelling units of various sizes and types in the

8 market area require such adjustment for continued

9 compliance with the requirements of paragraph (1).

10 Any adjustments shall be based on the most recent

11 data available trended so the payment standards will

12 be current for the year to which they apply.

13 (3) EFFECTIVENESS.—The Voucher Adminis14 trator shall cause to be published in the Federal

15 Register any proposed fair market rentals or adjust16 ments in a manner to provide reasonable time for

17 public comment to the independent entity establish18 ing such fair market rentals. The proposed fair mar19 ket rentals shall become effective upon the date of

20 publication in final form in the Federal Register.

21 SEC. 225. ELIGIBLE DWELLING UNITS.

22 (a) SELECTION BY FAMILY.—The determination of

23 the eligible dwelling unit in which an assisted family re24 sides and for which housing assistance is provided under

25 this subtitle shall be made solely by the assisted family.
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1 (b) DEFINITION.—For purposes of this subtitle, the

2 term ‘‘eligible dwelling unit’’ means a dwelling unit that

3 complies with any applicable State or local laws, regula4 tions, standards, or codes relating to housing or property

5 construction or condition.

6 SEC. 226. RENTS.

7 (a) REASONABLENESS AND NEGOTIATION.—The

8 rents charged for eligible dwelling units for which housing

9 assistance is provided under this title shall be—

10 (1) reasonable, in the determination of the ap11 plicable local voucher assistance agency, in compari12 son with rents charged for comparable units in the

13 private unassisted market; and

14 (2) established pursuant to negotiation and

15 agreement between the assisted family and the

16 owner of the dwelling unit.

17 (b) REVIEW OF RENTS.—To determine whether the

18 rent (or any rent increase) requested by an owner is rea19 sonable for purposes of subsection (a)(1), a local voucher

20 assistance agency shall review all rents for dwelling units

21 under consideration by families on behalf of whom housing

22 assistance is provided by the agency (or all rent increases

23 for units under lease by families so assisted). If the local

24 voucher assistance agency determines that the rent (or
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1 rent increase) for a unit is not reasonable, the agency may

2 disapprove a lease for such unit.

3 (c) NEGOTIATION.—A local voucher assistance agen4 cy shall, at the request of a family on behalf of whom

5 housing assistance is provided, assist the family in nego6 tiating a reasonable rent with an owner of a rental dwell7 ing unit.

8 SEC. 227. LEASES.

9 Housing assistance payments may be made for the

10 rental of an eligible dwelling unit by an eligible family only

11 pursuant to a lease between the family and the owner of

12 the dwelling unit that complies with any applicable State

13 or local laws, regulations, standards, or codes relating to

14 leases for rental of residential dwelling units.

15 SEC. 228. PREFERENCES FOR ASSISTANCE.

16 A local voucher assistance agency may carry out, in

17 a fiscal year, a system for selecting eligible families to be

18 assisted families that provides preference for such selec19 tion to families having certain characteristics that exhibit

20 a particular need or exigency for housing assistance. As21 sistance may not be provided pursuant to any preferences

22 established pursuant to this section until assistance is first

23 made available pursuant to any requirements and pref24 erences under subtitle A of title III.
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1 SEC. 229. PORTABILITY.

2 (a) AUTHORITY.—Except as provided in subsection

3 (b), any assisted family who moves to an eligible dwelling

4 unit located within the same State, or the same or a con5 tiguous metropolitan statistical area, as the metropolitan

6 statistical area within which is located the area of jurisdic7 tion of the local voucher assistance agency approving the

8 assistance for the family, may use such assistance to rent

9 the eligible dwelling unit.

10 (b) REQUIRED MINIMUM RESIDENCY.—Any family

11 not living within the jurisdiction of a local voucher assist12 ance agency at the time that the family applies for housing

13 assistance from the agency shall, during the 12-month pe14 riod beginning upon the provision of housing assistance

15 on behalf of the family, use such assistance to rent an

16 eligible dwelling unit located within the jurisdiction served

17 by the local voucher assistance agency.

18 (c) ADMINISTRATION.—The local voucher assistance

19 agency having authority with respect to the dwelling unit

20 to which a family moves under this section shall have the

21 responsibility of carrying out the provisions of this section

22 with respect to the family. If no local voucher assistance

23 agency has authority with respect to the dwelling unit to

24 which a family moves under this section, the local voucher

25 assistance agency approving the assistance shall have such

26 responsibility.
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1 SEC. 230. USE OF HOUSING ASSISTANCE FOR HOMEOWNER2 SHIP.

3 (a) REQUIREMENTS FOR HOMEOWNERSHIP USE.—

4 An assisted family may use the housing assistance under

5 this subtitle for costs of occupying a dwelling owned by

6 one or more members of the family only if the family—

7 (1) is a first-time homeowner;

8 (2) demonstrates to the satisfaction of the local

9 voucher assistance agency that the family has in10 come from employment or other sources (other than

11 public assistance), as determined in accordance with

12 requirements of the Voucher Administrator, that is

13 not less than an amount established for purposes of

14 this subsection by the local voucher assistance agen15 cy (or such other amount as may be established by

16 the Voucher Administrator);

17 (3) except as provided by the Voucher Adminis18 trator, demonstrates at the time the family initially

19 receives housing assistance that 1 or more adult

20 members of the family have achieved employment for

21 the period as the Voucher Administrator shall re22 quire; and

23 (4) meets any other initial or continuing re24 quirements established by the local voucher assist25 ance agency in accordance with requirements estab26 lished by the Voucher Administrator.
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1 (b) RECAPTURE OF CERTAIN AMOUNTS.—Upon the

2 sale, by an assisted family, of a dwelling unit for which

3 housing assistance is used pursuant to this section, the

4 Voucher Administrator shall recapture from any net pro5 ceeds of the sale any amount of additional assistance (as

6 determined in accordance with requirements established

7 by the Voucher Administrator) paid to or on behalf of the

8 assisted family as a result of section 223(b).

9 (c) DOWNPAYMENT REQUIREMENT.—A local voucher

10 assistance agency providing housing assistance for an as11 sisted family that is used pursuant to this section shall

12 ensure that the family provides from its own resources not

13 less than 80 percent of any downpayment in connection

14 with a loan made for the purchase of the dwelling for

15 which the assistance is used. Not more than 20 percent

16 of the downpayment may be provided from other sources,

17 such as from nonprofit entities and programs of States

18 and units of general local government.

19 (d) INELIGIBILITY UNDER OTHER PROGRAMS.—

20 Housing assistance may not be provided pursuant to this

21 section on behalf of a family at any time during which

22 assistance is being provided for the family under any other

23 Federal program for homeownership assistance, which

24 shall include assistance under subtitle B of title III of this

25 Act, section 502 of the Housing Act of 1949, and such
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1 other programs as the Voucher Administrator may iden2 tify.

3 (e) INAPPLICABILITY OF CERTAIN PROVISIONS.—

4 Housing assistance provided pursuant to this section shall

5 not be subject to the requirements of any other provisions

6 of this subtitle that are inconsistent with the provisions

7 of this section.

8 (f) DEFAULT.—

9 (1) PROHIBITION OF SUBSEQUENT HOME10 OWNERSHIP ASSISTANCE.—An assisted family using

11 housing assistance pursuant to this section who de12 faults under the mortgage for the dwelling assisted

13 may not receive assistance under this section for oc14 cupancy of any other dwelling owned by one or more

15 members of the family.

16 (2) REVERSION OF ASSISTANCE TO RENTAL

17 STATUS.—If an assisted family using housing assist18 ance pursuant to this section defaults under a mort19 gage on the dwelling assisted, the local voucher as20 sistance agency may not continue to provide housing

21 assistance under this subtitle on behalf of the family

22 for rental of a dwelling unit unless the family com23 plies with requirements established by the Voucher

24 Administrator. In the case of a mortgage insured

25 under the National Housing Act or title IV of this
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1 Act, such requirements shall consist of transferring

2 to the Voucher Administrator marketable title to the

3 dwelling, and (B) moving from the dwelling within

4 the period established or approved by the Voucher

5 Administrator.

6 (g) DEFINITION OF FIRST-TIME HOMEOWNER.—For

7 purposes of this section, the term ‘‘first-time homeowner’’

8 means—

9 (1) a family, no member of which has had a

10 present ownership interest in a principal residence

11 during the 3 years preceding the date on which the

12 housing assistance pursuant to this section is ini13 tially provided on behalf of the family; and

14 (2) any other family, as the Voucher Adminis15 trator may prescribe.

16 SEC. 231. ANNUAL CONTRIBUTIONS CONTRACTS.

17 (a) IN GENERAL.—To the extent that amounts to

18 carry out this subtitle are made available for a fiscal year,

19 the Voucher Administrator shall enter into annual con20 tributions contracts under this section with voucher assist21 ance agencies in States that have not provided notice

22 under section 252, under which—

23 (1) the local voucher assistance agency agrees

24 to administer the provision of housing assistance in

25 the jurisdiction of operation of the agency during
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1 such fiscal year in accordance with the provisions of

2 this subtitle; and

3 (2) the Voucher Administrator agrees to make

4 amounts for the fiscal year available to the local

5 voucher assistance agency for providing housing as6 sistance under this subtitle in such fiscal year and,

7 to the extent authorized in section 233, for costs of

8 administering such assistance.

9 (b) ANNUAL OBLIGATION OF AUTHORITY.—An an10 nual contributions contract shall be for a single fiscal year

11 and shall provide amounts for housing assistance to fund

12 vouchers for a 1-year period, but amounts received under

13 an annual contributions contract may be expended by the

14 local voucher assistance agency during any year.

15 SEC. 232. HOUSING VOUCHER CONTRACTS.

16 (a) IN GENERAL.—To provide housing assistance

17 under this subtitle on behalf of an assisted family using

18 amounts made available to a local voucher assistance

19 agency under an annual contributions contract, the agency

20 shall enter into a housing voucher contract under this sec21 tion on behalf of the assisted family under which—

22 (1) the owner of an eligible dwelling unit agree

23 to lease the unit to the specific assisted family; and
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1 (2) the local voucher assistance agency agrees

2 to make housing assistance payments to the owner

3 of the dwelling unit on behalf of the assisted family.

4 (b) TERM.—The term of a housing voucher contract

5 entered into by a local voucher assistance agency and the

6 owner of an eligible dwelling unit may not exceed one year

7 and if the lease for the dwelling unit entered into by the

8 assisted family and the owner does not exceed one year,

9 the term of the housing voucher contract shall run concur10 rently with the term of the lease.

11 (c) PROHIBITION OF PAYMENT FOR VACANT

12 UNITS.—Each housing voucher contract shall provide that

13 if the assisted family under the contract vacates the dwell14 ing unit for which housing assistance payments are made

15 under the contract before the expiration of the lease term,

16 the local voucher assistance agency may not make any

17 monthly assistance payment with respect to the unit for

18 any month commencing after the month during which the

19 unit was vacated.

20 (d) OTHER PROVISIONS.—Each housing voucher con21 tract shall contain such other provisions as the Voucher

22 Administrator may require and may provide for the local

23 voucher assistance agency and the owner to carry out such

24 other appropriate terms and conditions as may be mutu25 ally agreed to by them.
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1 SEC. 233. ADMINISTRATIVE FEE.

2 (a) ESTABLISHMENT.—The Voucher Administrator

3 shall establish a fee for the costs incurred by voucher as4 sistance agencies in administering the program for hous5 ing assistance under this subtitle. From any amounts

6 made available to a local voucher assistance agency for

7 a fiscal year to carry out this subtitle, the agency may

8 use an amount not exceeding the fee for costs of admin9 istering the program under this subtitle.

10 (b) AMOUNT.—The amount of the administrative fee

11 under subsection (a) for each month for which a dwelling

12 unit is covered by a housing voucher contract shall be 7.2

13 percent of the payment standard established under section

14 224 for a 2-bedroom rental dwelling unit in the housing

15 market area of the local voucher assistance agency. The

16 Voucher Administrator may increase the fee if necessary

17 to reflect the higher costs of administering small programs

18 and programs operating over large geographic areas.

19 SEC. 234. LOCAL VOUCHER ASSISTANCE AGENCIES.

20 (a) REQUIREMENTS.—Except as provided under sec21 tion 312(i), an entity shall be considered a local voucher

22 assistance agency for purposes of this subtitle only if—

23 (1) the entity is authorized by a State, county,

24 municipality, or other governmental body or public

25 entity to administer the provision of housing assist26 ance under this subtitle within an area subject to
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1 the governance of such governmental body or public

2 entity; and

3 (2) such entity or the governmental body or

4 public entity submits to the Voucher Administrator

5 appropriate evidence of such authority.

6 A private entity or contractor, a tenant management cor7 poration, or any entity acting as a public housing agency

8 for purposes of the United States Housing Act of 1937,

9 may be a local voucher assistance agency for purposes of

10 this subtitle, to the extent that such entity meets the re11 quirements of this subsection.

12 (b) FEDERAL CONTRACTORS.—For any area for

13 which no entity qualifies under subsection (a) as a local

14 voucher assistance agency, the Voucher Administrator

15 may enter into a contract with an appropriate nonprofit

16 or for-profit organization to act as a local voucher assist17 ance agency for the area. Such a contract shall define the

18 area in which the contractor shall operate as a local vouch19 er assistance agency, provide for such monitoring and

20 oversight of contractor as the Voucher Administrator con21 siders appropriate, and provide for the immediate termi22 nation of the contract upon the effective date of any notice

23 under section 252 by the State within which such area

24 is located.
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1 SEC. 235. DEFINITIONS.

2 For purposes of this subtitle, the following definitions

3 shall apply:

4 (1) ADJUSTED INCOME.—The term ‘‘adjusted

5 income’’ means the income which remains after ex6 cluding—

7 (A) $480 for each member of the family

8 residing in the household (other than the head

9 of the household or spouse) who is—

10 (i) under 18 years of age; or

11 (ii) 18 years of age or older and is a

12 person with disabilities or a full-time stu13 dent;

14 (B) $400 for any elderly or disabled fam15 ily;

16 (C) the amount by which 3 percent of an17 nual family income is exceeded by the sum of—

18 (i) any medical expenses for any el19 derly or disabled family; and

20 (ii) any reasonable attendant care and

21 auxiliary apparatus expenses for each fam22 ily member who is a person with disabil23 ities, to the extent necessary to enable any

24 member of such family (including such

25 member who is a person with disabilities)

26 to be employed; and
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1 (D) child care expenses to the extent nec2 essary to enable another member of the family

3 to be employed or to further his or her edu4 cation.

5 (2) ANNUAL CONTRIBUTIONS CONTRACT.—The

6 term ‘‘annual contributions contract’’ means a con7 tract under section 231 between the Voucher Admin8 istrator and a local voucher assistance agency.

9 (3) ASSISTED FAMILY.—The term ‘‘assisted

10 family’’ means a family on behalf of whom housing

11 assistance is provided under this subtitle or that has

12 been determined by a local voucher assistance agen13 cy to be an eligible family and issued a voucher.

14 (4) DWELLING UNIT.—The term ‘‘dwelling

15 unit’’ includes a single family home and a residential

16 property in which some or all of the dwelling units

17 do not contain bathroom or kitchen facilities.

18 (5) ELDERLY FAMILIES AND DISABLED FAMI19 LIES.—The terms ‘‘elderly families’’ and ‘‘disabled

20 families’’ mean families whose heads (or their

21 spouses), or whose sole members, are elderly or per22 sons with disabilities, respectively. The terms include

23 2 or more elderly persons or persons with disabilities

24 living together, and 1 or more such persons living

25 with 1 or more persons determined under the regula-
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1 tions of the Voucher Administrator to be essential to

2 their care or well-being.

3 (6) ELDERLY PERSON.—The term ‘‘elderly per4 son’’ means a person who is at least 62 years of age.

5 (7) FAMILIES.—The term ‘‘family’’ includes a

6 family that consists of a single person.

7 (8) HOUSING ASSISTANCE.—The term ‘‘housing

8 assistance’’ means financial assistance under this

9 subtitle on behalf of an assisted family.

10 (9) HOUSING VOUCHER CONTRACT.—The term

11 ‘‘housing voucher contract’’ means a contract under

12 section 232 between a local voucher assistance agen13 cy and an owner of an eligible dwelling unit.

14 (10) LOCAL VOUCHER ASSISTANCE AGENCY.—

15 The term ‘‘local voucher assistance agency’’ means

16 an entity that meets the requirements of section

17 234(a) or that has entered into a contract with the

18 Voucher Administrator under section 234(b). The

19 term does not include any Indian housing authority.

20 (11) LOW-INCOME FAMILY.—The term ‘‘low-in21 come family’’ means a family whose income does not

22 exceed 80 percent of the median income for the

23 area, as determined by the Voucher Administrator

24 with adjustments for smaller and larger families, ex25 cept that the Voucher Administrator may establish
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1 income ceilings higher or lower than 80 percent of

2 the median for the area on the basis of the Voucher

3 Administrator’s findings that such variations are

4 necessary because of prevailing levels of construction

5 costs or unusually high or low family incomes.

6 (12) OWNER.—The term ‘‘owner’’ means, with

7 respect to a dwelling unit, any private person or en8 tity, including a cooperative, an agency of the Fed9 eral Government, or a local voucher assistance agen10 cy, having the legal right to lease or sublease the

11 dwelling unit.

12 (13) PERSON WITH DISABILITIES.—The term

13 ‘‘person with disabilities’’ means a person who—

14 (A) has a disability as defined in section

15 223 of the Social Security Act,

16 (B) is determined, pursuant to regulations

17 issued by the Voucher Administrator, to have a

18 physical, mental, or emotional impairment

19 which (i) is expected to be of long-continued

20 and indefinite duration, (ii) substantially im21 pedes his or her ability to live independently,

22 and (iii) is of such a nature that such ability

23 could be improved by more suitable housing

24 conditions, or
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1 (C) has a developmental disability as de2 fined in section 102 of the Developmental Dis3 abilities Assistance and Bill of Rights Act.

4 Such term shall not exclude persons who have the

5 disease of acquired immunodeficiency syndrome or

6 any conditions arising from the etiologic agent for

7 acquired immunodeficiency syndrome.

8 (14) RENT AND RENTAL.—The terms ‘‘rent’’

9 and ‘‘rental’’ mean, with respect to members of a co10 operative, the charges under the occupancy agree11 ments between such members and the cooperative.

12 (15) TENANT MANAGEMENT CORPORATION.—

13 The term ‘‘tenant management corporation’’ means

14 a corporation that—

15 (A) is established—

16 (i) for the purpose of managing a

17 public housing project (or projects) as18 sisted under the United States Housing

19 Act of 1937 or subtitle B of title III; and

20 (ii) by the tenant organization or resi21 dent council (or such organizations or

22 councils) for the project (or projects);

23 (B) is nonprofit in character;

24 (C) is organized under the laws of the

25 State in which the projects are located;
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1 (D) has an elected board of directors,

2 which is required at all times to include rep3 resentatives of each tenant organization or resi4 dent council involved in establishing the cor5 poration;

6 (E) has as its sole voting members resi7 dents of the projects managed by the corpora8 tion; and

9 (F) is approved by the resident council for

10 (or councils) for the project (or projects) or, if

11 a project has no council, by a majority of the

12 households of the project.

13 (16) VOUCHER.—The term ‘‘voucher’’ means a

14 document described in section 222(b).

15 Subtitle C—Determination of State

16 Allocations and Election of Fed17 eral or State Voucher Program

18 SEC. 251. STATE ALLOCATIONS.

19 (a) IN GENERAL.—For fiscal year 1996 and each fis20 cal year thereafter, the Voucher Administrator shall allo21 cate among the States any amounts appropriated to carry

22 out this title for such fiscal year.

23 (b) LIMIT ON ASSISTED FAMILIES PER STATE.—In

24 allocating such amounts, the Voucher Administrator shall

25 determine a maximum limit of assisted families for each
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1 State by application of the formula established under sub2 section (c) of this section to the maximum national limit

3 of assisted families determined under section 282(c). The

4 sum of the various maximum limits of assisted families

5 for each of the States shall be equal to maximum national

6 limit of assisted families.

7 (c) FORMULA.—The Voucher Administrator shall, by

8 regulation, establish a formula to determine the relative

9 needs among different States and areas for housing assist10 ance under this title. The formula shall determine such

11 need based on information regarding population, poverty,

12 housing overcrowding, housing vacancies, amount of sub13 standard housing, and other objectively measurable condi14 tions specified in the regulation.

15 (d) MAXIMUM ALLOCATION.—Except as provided in

16 subsection (e), the allocation under this section for a State

17 for a fiscal year shall be the amount, determined by the

18 Voucher Administrator, that is the product of—

19 (1) the maximum limit of assisted families de20 termined (under subsection (b)) for the State for the

21 year; and

22 (2) the amount determined by the Voucher Ad23 ministrator to be necessary to provide housing as24 sistance under subtitle B for the year for a number

25 of families equal to such maximum limit (taking into
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1 consideration differences in the amounts necessary

2 to provide housing assistance in different areas).

3 (e) PRO RATA REDUCTION.—If the amount available

4 for a fiscal year to carry out this title is not sufficient

5 to provide the amount of the allocation determined under

6 subsection (d) for each State, the maximum limit of as7 sisted families for each State determined under subsection

8 (b) shall be reduced on a pro rata basis to the extent nec9 essary so that the product under subsection (d) is equal

10 to the amount available for assistance under this title. For

11 such a fiscal year, the allocation under this section for

12 each State shall be the product determined under sub13 section (d) using such reduced limit.

14 (f) INCLUSION OF AMOUNTS FOR ADMINISTRATIVE

15 FEES.—Notwithstanding subsections (e) and (f), the

16 Voucher Administrator may increase the amount of the

17 allocation for each State for a fiscal year by an amount

18 not exceeding the amount of the administrative fee under

19 section 206 or 233, as applicable, for the State.

20 SEC. 252. AVAILABILITY OF STATE ALLOCATION BASED ON

21 ELECTION TO USE FEDERAL OR STATE

22 VOUCHER PROGRAM.

23 (a) ELECTION TO RECEIVE STATE VOUCHER ASSIST24 ANCE.—If a State at any time provides notice under sub-
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1 section (c) to the Voucher Administrator, the Voucher Ad2 ministrator—

3 (1) shall, for each fiscal year after the effective

4 date of such notice, make available to the State a

5 grant under subtitle A in the amount allocated for

6 the State under section 251 for such fiscal year; and

7 (2) may not, at any time after the effective date

8 of such notice, enter into any commitment to pro9 vide, or provide, amounts for assistance under sub10 title B for use for housing within such State.

11 (b) FEDERAL VOUCHER ASSISTANCE.—With respect

12 to a fiscal year, if a State has not provided notice under

13 subsection (c) that takes effect for, or before, such fiscal

14 year, the Voucher Administrator shall make available to

15 local voucher assistance agencies within the State, under

16 annual contributions contracts under section 231, the

17 amount allocated for the State under section 251 for the

18 fiscal year.

19 (c) NOTICE OF ELECTION.—Notice under this sub20 section shall be written notice that—

21 (1) is signed by the chief executive officer of the

22 State;

23 (2) includes a certification that the notice is

24 specifically authorized by State law;
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1 (3) the State will carry out, after the effective

2 date of the notice, a program for housing voucher

3 payments in accordance with subtitle A;

4 (4) includes a certification that block grant

5 amounts made available to the State under subtitle

6 A will be used for housing voucher assistance in

7 compliance with the requirements of subtitle A; and

8 (5) indicates the effective date of the notice for

9 purposes of subsection (a), which shall be the first

10 day of a Federal fiscal year.

11 (d) PROHIBITION AGAINST REVOKING NOTICE.—

12 Once provided to the Voucher Administrator, notice under

13 subsection (c) by a State may not subsequently be re14 pealed, revoked, waived, annulled, returned, or otherwise

15 affected for purposes of treatment of the State under sub16 section (a).

17 Subtitle D—Office of Federal Hous18 ing Voucher Assistance in De19 partment of Health and Human

20 Services

21 SEC. 261. ESTABLISHMENT.

22 There is hereby established an office within the De23 partment of Health and Human Services, which shall be

24 known as the Office of Federal Housing Voucher Assist25 ance.
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1 SEC. 262. VOUCHER ADMINISTRATOR.

2 (a) APPOINTMENT.—The Office shall be under the

3 management of an Administrator, who shall be appointed

4 by the President, by and with the advice and consent of

5 the Senate.

6 (b) COMPENSATION AT LEVEL IV OF EXECUTIVE

7 SCHEDULE.—Section 5315 of title 5, United States Code,

8 is amended by inserting at the end the following new item:

9 ‘‘Administrator, Office of Federal Housing

10 Voucher Assistance, Department of Health and

11 Human Services.’’.

12 (c) EFFECTIVE DATE.—This section shall take effect,

13 and the amendment under this section is made and shall

14 apply, on the date of the enactment of this Act.

15 SEC. 263. DUTY AND AUTHORITY OF VOUCHER ADMINIS16 TRATOR.

17 The Voucher Administrator shall be responsible, sub18 ject to the supervision and direction of the Secretary of

19 Health and Human Services, for—

20 (1) determining State allocations under subtitle

21 C and make such allocations available in accordance

22 with the provisions of such subtitle for use under

23 subtitles A and B;

24 (2) carrying out the voucher assistance program

25 under subtitle B; and
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1 (3) exercising any other authority and functions

2 of the Secretary of Housing and Urban Development

3 transferred under title III to the Voucher Adminis4 trator.

5 SEC. 264. TRANSFER OF CERTAIN PERSONNEL.

6 The personnel that, on the effective date of this sub7 title (as provided in section 268(a), are employed in the

8 Department of Housing and Urban Development in con9 nection with functions of the Department relating to de10 termining fair market rentals under section 8 of the

11 United States Housing Act of 1937, as determined by the

12 Director of the Office of Management and Budget, shall

13 be transferred on such date to the Office of Federal Hous14 ing Voucher Assistance.

15 SEC. 265. REPORTS.

16 The Voucher Administrator shall submit a report to

17 the Congress annually describing—

18 (1) the amount of assistance provided under

19 this title pursuant to subtitle A and subtitle B dur20 ing the year for which the report is made;

21 (2) the amount of assistance provided to each

22 State for such year and whether the assistance was

23 provided under subtitle A or B; and

24 (3) the number of families assisted under each

25 such subtitle.
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1 SEC. 266. GAO AUDITS.

2 The Comptroller General shall audit the operations

3 of the Office in accordance with generally accepted Gov4 ernment auditing standards. All books, records, accounts,

5 reports, files, and property belonging to, or used by, the

6 Voucher Administrator shall be made available to the

7 Comptroller General. Audits under this section shall be

8 conducted annually.

9 SEC. 267. REGULATIONS.

10 The Voucher Administrator may issue any regula11 tions necessary to carry out the responsibilities of the

12 Voucher Administrator under this title.

13 SEC. 268. EFFECTIVE DATE.

14 Except as otherwise specifically provided in this sub15 title, this subtitle shall take effect on the effective date

16 under section 108(a).

17 Subtitle E—General Provisions

18 SEC. 281. DEFINITIONS.

19 For purposes of this title, the following definitions

20 shall apply:

21 (1) OFFICE.—The term ‘‘Office’’ means the Of22 fice of Federal Housing Voucher Assistance of the

23 Department of Health and Human Services, estab24 lished under subtitle D.

25 (2) STATE.—The term ‘‘State’’ means the

26 States of the United States, the District of Colum-
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1 bia, the Commonwealth of Puerto Rico, the Com2 monwealth of the Northern Mariana Islands, Guam,

3 the Virgin Islands, American Samoa, and any other

4 territory or possession of the United States.

5 (3) VOUCHER ADMINISTRATOR.—The term

6 ‘‘Voucher Administrator’’ means the Administrator

7 of the Office of Federal Housing Voucher Assist8 ance, appointed under section 262.

9 SEC. 282. MAXIMUM AMOUNT OF HOUSING ASSISTANCE.

10 (a) PERMANENT LIMITATION.—The aggregate

11 amount of assistance made available under this title for

12 fiscal year 2001 or any fiscal year thereafter may not ex13 ceed the sum of—

14 (1) the amount necessary for such year to pro15 vide housing assistance under subtitle B for a num16 ber of families equal to the maximum national limit

17 of assisted families (as such term is defined in sub18 section (c)), taking into consideration the allocation

19 of such assistance by State and area under section

20 251; and

21 (2) the amount necessary for such year to pro22 vide administrative fees under sections 206 and 233

23 in connection with such assistance.

24 (b) TRANSITION LIMITATION.—The aggregate

25 amount of assistance made available under this title for
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1 any of fiscal years 1996, 1997, 1998, 1999, or 2000 may

2 not exceed the sum of—

3 (1) the amount necessary (taking into consider4 ation the allocation of such assistance by State and

5 area under section 251) for such year to provide

6 housing assistance under subtitle B for a number of

7 families equal to the difference between—

8 (A) the maximum national limit of assisted

9 families; and

10 (B) the sum of—

11 (i) the maximum number of families

12 for which assistance under section 8 of the

13 United States Housing Act of 1937 may

14 be made available or provided, at any one

15 time, during such year; and

16 (ii) the maximum number of families

17 which may, at any one time during such

18 year, occupy dwelling units in public hous19 ing assisted under the United States Hous20 ing Act of 1937 or subtitle B of this title;

21 and

22 (2) the amount necessary for such year to pro23 vide administrative fees under sections 206 and 233

24 in connection with such assistance.
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1 (c) MAXIMUM NATIONAL LIMIT OF ASSISTED FAMI2 LIES.—For purposes of this title, the term ‘‘maximum na3 tional limit of assisted families’’ means the maximum ag4 gregate number of families for which the following assist5 ance was available or provided, at any one time, during

6 fiscal year 1995:

7 (1) SECTION 8.—Rental or homeownership as8 sistance under any program under section 8 of the

9 United States Housing Act of 1937.

10 (2) PUBLIC HOUSING.—Residence in a dwelling

11 unit in public housing.

12 The maximum national limit on assisted families shall not

13 take into consideration any families assisted under such

14 rental, homeownership, or public housing programs of In15 dian housing authorities.

16 SEC. 283. AUTHORIZATION OF APPROPRIATIONS.

17 There is authorized to be appropriated to carry out

18 this title—

19 (1) for fiscal year 1996, the lesser of

20 $3,990,000,000 or the maximum amount determined

21 under section 282(b) for such year;

22 (2) for fiscal year 1997, the lesser of

23 $8,515,000,000 or the maximum amount determined

24 under section 282(b) for such year;
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1 (3) for fiscal year 1998, the lesser of

2 $14,965,000,000 or the maximum amount deter3 mined under section 282(b) for such year;

4 (4) for fiscal year 1999, the lesser of

5 $21,209,000,000 or the maximum amount deter6 mined under section 282(b) for such year; and

7 (5) for fiscal year 2000, the lesser of

8 $24,344,000,000 or the maximum amount deter9 mined under section 282(b) for such year.

10 TITLE III—TRANSITION PROVI11 SIONS RELATING TO RE12 PLACEMENT OF PUBLIC

13 HOUSING AND ASSISTED

14 HOUSING PROGRAMS

15 SEC. 301. PURPOSE.

16 The provisions of this title are enacted for the pur17 poses of—

18 (1) replacing, with housing assistance under

19 title II, all assistance provided under the programs

20 for the development, operation, modernization, reha21 bilitation, and revitalization of public housing and

22 under all programs for project- and tenant-based

23 rental assistance under section 8 of the United

24 States Housing Act of 1937; and
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1 (2) providing for the replacement of such assist2 ance over a period of 5 years in an efficient manner

3 that deregulates public housing agencies and pro4 vides assistance to such agencies during such in5 terim period through a single block grant.

6 Subtitle A—Replacement of

7 Assisted Housing Programs

8 SEC. 311. TERMINATION OF EXISTING PROGRAMS.

9 (a) TERMINATION OF PUBLIC HOUSING BLOCK

10 GRANT PROGRAM AFTER 5 YEARS.—After September 30,

11 1999, no financial assistance may be provided under the

12 public housing block grant program under subtitle B of

13 this title.

14 (b) IMMEDIATE PROHIBITION OF NEW COMMIT15 MENTS FOR RENTAL ASSISTANCE.—After the date of the

16 enactment of this Act, no new commitment (including the

17 renewal of any contract) may be made to provide financial

18 assistance under any of the following programs:

19 (1) TENANT-BASED SECTION 8 ASSISTANCE.—

20 Any program for tenant-based rental or homeowner21 ship assistance under section 8 of the United States

22 Housing Act of 1937, including—

23 (A) the certificate and voucher programs

24 under subsections (b) and (o), respectively, of

25 such section;
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1 (B) the program for moving to opportunity

2 for fair housing under section 152 of the Hous3 ing and Community Development Act of 1992;

4 (C) the community investment demonstra5 tion under section 6 of the HUD Demonstra6 tion Act of 1993; and

7 (D) the program under section 8(q)(3) of

8 the United States Housing Act of 1937 for

9 service coordinators for families receiving ten10 ant-based rental assistance.

11 (2) PROJECT-BASED SECTION 8 ASSISTANCE.—

12 Any program for project-based rental assistance

13 under such section 8, including project-based assist14 ance provided pursuant to—

15 (A) the Low-Income Housing Preservation

16 and Resident Homeownership Act of 1990;

17 (B) the Emergency Low Income Housing

18 Preservation Act of 1987;

19 (C) the program for loan management as20 sistance under such section 8;

21 (D) the program for assistance under such

22 section 8 for property disposition;

23 (E) section 441 of the Stewart B. McKin24 ney Homeless Assistance Act;
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1 (F) parts III and V of subtitle F of title

2 IV of the Stewart B. McKinney Homeless As3 sistance Act; and

4 (G) the program under section 8(d)(2)(f)

5 of the United States Housing Act of 1937 for

6 service coordinators in project-based rental

7 housing.

8 (3) TENANT-BASED RENTAL ASSISTANCE FOR

9 DISABLED FAMILIES.—The program for tenant10 based rental assistance under subsections (b)(2)(B)

11 and (d)(4) of section 811 of the Cranston-Gonzalez

12 National Affordable Housing Act.

13 (4) RENTAL ASSISTANCE FOR PERSONS WITH

14 AIDS.—The programs for rental assistance for per15 sons with AIDS under sections 859 and 860 of the

16 Cranston-Gonzalez National Affordable Housing

17 Act.

18 (5) SHELTER PLUS CARE RENTAL ASSISTANCE

19 FOR HOMELESS PERSONS.—The programs for rental

20 assistance under parts II and IV of subtitle F of

21 title V of the Stewart B. McKinney Homeless Assist22 ance Act.

23 (6) TENANT OPPORTUNITY PROGRAM.—The

24 tenant opportunity program under the Departments

25 of Veterans Affairs and Housing and Urban Devel-
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1 opment, and Independent Agencies Appropriations

2 Act, 1994 (Public Law 103–327; 108 Stat. 2306).

3 (c) IMMEDIATE PROHIBITION OF NEW COMMIT4 MENTS FOR OTHER PROJECT-BASED ASSISTANCE.—After

5 the date of the enactment of this Act, no new commitment

6 may be made to provide financial assistance under any of

7 the following programs:

8 (1) FLEXIBLE SUBSIDIES.—The flexible subsidy

9 program under section 201 of the Housing and

10 Community Development Amendments of 1978.

11 (2) PRESERVATION PROGRAMS.—Any authority

12 under the Low-Income Housing Preservation and

13 Resident Homeownership Act of 1990 or the Emer14 gency Low Income Housing Preservation Act of

15 1987 for assistance other than the assistance re16 ferred to in paragraph (2) of subsection (b).

17 (3) SERVICE COORDINATORS FOR ASSISTED

18 PROJECTS.—The grant program under section 676

19 of the Housing and Community Development Act of

20 1992 for providing service coordinators for federally

21 assisted housing projects.

22 (d) IMMEDIATE PROHIBITION OF NEW COMMIT23 MENTS FOR INDIAN HOUSING ASSISTANCE.—After the

24 date of the enactment of this Act, no new commitment
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1 may be made to provide financial assistance under any of

2 the following programs:

3 (1) PUBLIC HOUSING.—Any program for public

4 housing for Indians under or pursuant to the United

5 States Housing Act of 1937.

6 (2) CHILDHOOD DEVELOPMENT.—The program

7 for Indian housing childhood development under sec8 tion 518 of the Cranston-Gonzalez National Afford9 able Housing Act.

10 (3) RENTAL ASSISTANCE.—The program to

11 provide rental assistance under section 8 of the

12 United States Housing Act of 1937 through Indian

13 housing authorities (including the renewal of any

14 contract).

15 (e) SAVINGS PROVISION.—Nothing in this section

16 may be construed to affect the validity of any right, duty,

17 or obligation of the United States or other person arising

18 under or pursuant to any commitment or agreement law19 fully entered into under any provision of law referred to

20 in this section before the applicable date under this section

21 prohibiting new assistance or commitments for assistance

22 under such law.
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1 SEC. 312. TRANSITION TO VOUCHER ASSISTANCE PRO2 GRAM.

3 (a) ORDERLY TRANSITION.—The Administrator of

4 the Office of Federal Housing Voucher Assistance and the

5 Administrator of the Housing and Urban Development

6 Programs Resolution Agency shall provide for the orderly

7 transition, during the transition period, from providing as8 sistance under the public housing block grant program

9 under subtitle B of this title to the provision of voucher

10 assistance under title II.

11 (b) PACE OF REPLACEMENT AND INTERMEDIATE

12 GOALS.—In carrying out this section, the Resolution Ad13 ministrator shall terminate the provision of public housing

14 block grant assistance under subtitle B to the greatest ex15 tent and as soon as practicable throughout the transition

16 period and, in doing so, shall ensure that, by October 1,

17 1998—

18 (1) for at least 50 percent of the total number

19 of families that resided in dwelling units in public

20 housing on October 1, 1995, and

21 (2) for all of the dwelling units of at least 50

22 percent of all public housing agencies,

23 the provision of assistance under subtitle B has been ter24 minated and replaced by the provision of assistance under

25 title II.
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1 (c) USE OF AMOUNTS.—Notwithstanding any other

2 provision of law, any assistance provided for public hous3 ing under the United States Housing Act of 1937 or sub4 title B of this title may be used for assistance under title

5 II.

6 (d) CONTINUITY OF ASSISTANCE.—To the greatest

7 extent practicable taking into consideration the availability

8 of amounts provided in appropriation Acts and the relative

9 needs of different States and areas (as determined under

10 section 251), during fiscal years 1996 through 2000, the

11 Voucher Administrator shall allocate to local voucher as12 sistance agencies under subtitle B of title II the amounts

13 made available to carry out such subtitle in a manner that

14 provides assistance sufficient for one assisted family under

15 such subtitle for each family for which assistance for the

16 rental or ownership of a dwelling unit is terminated pursu17 ant to section 311.

18 (e) RESPONSIBILITIES OF EXISTING PHA’S.—Any

19 public housing agency administering the provision of as20 sistance under section 8 of the United States Housing Act

21 of 1937 upon the commencement of the transition period

22 may continue after such date to administer the provision

23 of any such assistance committed before such date for use

24 by such agency or may transfer responsibility for admin25 istering such assistance to another entity acting as a local
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1 voucher assistance agency for purposes of subtitle B of

2 title II.

3 (f) PROHIBITION OF DUPLICATIVE ASSISTANCE DUR4 ING TRANSITION.—A dwelling unit for which housing as5 sistance is provided under title II may not be assisted in

6 any manner with any amounts made available under this

7 title.

8 (g) PLAN AND REPORTS.—

9 (1) TRANSITION PLAN.—Not later than 6

10 months after the date of the enactment of this Act,

11 the Resolution Administrator and the Voucher Ad12 ministrator shall jointly establish, and submit to the

13 Congress, a plan providing for the transition of as14 sistance for public housing to voucher assistance

15 under title II, in accordance with the requirements

16 of this subtitle.

17 (2) ANNUAL REPORTS.—Not later than 3

18 months after the conclusion of each of fiscal years

19 1996, 1997, 1998, 1999, and 2000, the Resolution

20 Administrator and the Voucher Administrator shall

21 jointly prepare, and submit to the Congress, a report

22 on the progress during such fiscal year of the transi23 tion under this subtitle to providing voucher assist24 ance under title II.
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1 (h) COORDINATION WITH PHA’S.—In carrying out

2 this section, the Resolution Administrator shall coordinate

3 with the public housing agencies to the extent necessary

4 to permit the agencies to establish plans under section 323

5 that conform with the requirements under this section and

6 the schedule established by the Resolution Administrator

7 and the Voucher Administrator for the transition under

8 this section.

9 (i) VOUCHERING BY TENANT MANAGEMENT COR10 PORATIONS.—Notwithstanding the plan under subsection

11 (g), any schedule for converting assistance for a public

12 housing agency from assistance under public housing

13 block grants under subtitle B to voucher assistance under

14 title II, or any plan under section 323, the Resolution Ad15 ministrator may provide for a tenant management cor16 poration (as such term is defined in section 235) to admin17 ister housing assistance under subtitle B of title II with

18 respect to families eligible for such assistance who are re19 siding in dwelling units in public housing projects assisted

20 at such time under the United States Housing Act of 1937

21 if—

22 (1) the tenant management corporation makes

23 a written request to the Resolution Administrator to

24 administer such assistance;
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1 (2) the public housing projects are located in a

2 State that has not provided notice under section 252

3 that the State elects to receive block grants for State

4 housing voucher assistance under subtitle A of title

5 II;

6 (3) the tenant management corporation has

7 management authority with respect to the projects;

8 and

9 (4) allowing the tenant management corpora10 tion to administer such assistance will provide

11 voucher assistance under subtitle B of title II for the

12 residents of such projects earlier than otherwise pro13 vided under the plan under subsection (g) of this

14 section or the plan of the relevant public housing

15 agency under section 323.

16 SEC. 313. TRANSFER OF RESIDUAL HUD AUTHORITY TO AD17 MINISTRATOR OF FEDERAL HOUSING VOUCH18 ER ASSISTANCE.

19 Effective on the termination date under section

20 105(d), there are transferred to the Voucher Adminis21 trator all functions of the Resolution Administrator re22 garding administration of any outstanding commitments

23 of the Resolution Administrator under the programs re24 ferred to in section 311 and of any amounts previously

25 appropriated in connection with such commitments.
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1 SEC. 314. TREATMENT OF FAMILIES ASSISTED UNDER TER2 MINATED PROGRAMS.

3 (a) ASSISTANCE FOR FAMILIES RESIDING IN MULTI4 FAMILY DISPOSITION PROJECTS.—

5 (1) IN GENERAL.—To the extent amounts for

6 assistance under title II are available, the relevant

7 State or voucher housing agency shall provide such

8 assistance for each low-income family that—

9 (A) resides—

10 (i) in a HUD-owned multifamily rent11 al housing project at the time of the sale

12 of the project or the mortgage for the

13 project under section 553; and

14 (ii) at such time, in a dwelling unit in

15 such project that was assisted with project16 based assistance under section 8 of the

17 United States Housing Act of 1937, sec18 tion 101 of the Housing and Urban Devel19 opment Act of 1965, section 236(f)(2) of

20 the National Housing Act, or section 23 of

21 the United States Housing Act of 1937 (as

22 in effect before January 1, 1975); and

23 (B) as a result of the sale of such project

24 or the mortgage for the project, will not other25 wise receive the benefit of the project-based as-
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1 sistance referred to in subparagraph (A)(ii)

2 over such period.

3 (2) HUD-OWNED MULTIFAMILY RENTAL

4 PROJECT.—For purposes of paragraph (1), the term

5 ‘‘HUD-owned multifamily rental project’’ means a

6 multifamily rental housing project which—

7 (A) is owned by the Secretary of Housing

8 and Urban Development or the Administrator

9 of the Federal Home Mortgage Insurance Fund

10 or is subject to a mortgage so owned; and

11 (B) is or, prior to acquisition of the project

12 or the mortgage for the project by such Sec13 retary or Administrator, was assisted or insured

14 under the National Housing Act or subject to

15 a loan under the Housing Act of 1959.

16 (b) PREFERENCE FOR FEDERAL VOUCHER ASSIST17 ANCE.—To the extent amounts are available after assist18 ance is provided pursuant to subsection (a), a family to

19 or on behalf of whom assistance for the rental or owner20 ship of a dwelling unit is provided under any program de21 scribed in section 311 and whose assistance is terminated

22 because of section 311 or 312, shall be given preference

23 for assistance made available under subtitle B of title II,

24 subject to the limitations under this section. Preference

25 pursuant to this subsection may be provided only for fami-
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1 lies that are eligible for such assistance under the applica2 ble provisions of such subtitle B.

3 (c) ONE-TIME APPLICABILITY.—Any family to or on

4 behalf of whom assistance is once provided under title II

5 pursuant to a preference under subsection (a) or (b) may

6 not, in any subsequent selection of families for available

7 assistance under subtitle A or B of title II, be accorded

8 preference pursuant to such subsection.

9 (d) PROHIBITION OF EVICTIONS.—With respect to a

10 dwelling unit that is—

11 (1) located in a public housing project for which

12 assistance under the United States Housing Act of

13 1937 or subtitle B of this title is terminated pursu14 ant to this subtitle and maintained by the public

15 housing agency as an occupiable dwelling unit avail16 able for rental, or

17 (2) assisted under any other program described

18 in section 311,

19 the family lawfully residing in the dwelling unit at the time

20 of the termination of such assistance may not be evicted

21 or otherwise required to vacate the unit solely because of

22 the termination and without consideration to the ability

23 of the family to pay rent for the unit.

24 (e) PROHIBITION OF DISCRIMINATION BY PUBLIC

25 HOUSING AGENCIES AGAINST VOUCHER HOLDERS.—
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1 After the transition under this subtitle of the public hous2 ing projects of a public housing agency to assistance under

3 title II, the agency may not refuse to lease an available

4 dwelling unit in any project of the agency that was devel5 oped or assisted with contributions under the United

6 States Housing Act of 1937 or subtitle B of this title to

7 any family on behalf of whom assistance is provided under

8 title II, or to enter into a housing voucher contract under

9 subtitle B of title II, a proximate cause of which is the

10 status of the family as so assisted.

11 SEC. 315. CONTINUED RESTRICTIONS ON USE OF EXISTING

12 PUBLIC HOUSING STOCK.

13 Any housing project developed or assisted with

14 amounts provided under the United States Housing Act

15 of 1937 or subtitle B of this title shall continue to be sub16 ject to any conditions or requirements under such Act or

17 title resulting from such assistance, except to the extent

18 specifically waived or provided otherwise under this title.

19 SEC. 316. AUDIT OF PROJECT-BASED SECTION 8 ASSIST20 ANCE CONTRACTS.

21 (a) AUDIT.—Not later than the expiration of the 24-

22 month period beginning upon the date of the enactment

23 of this Act, the Resolution Administrator shall conduct an

24 audit to identify each multifamily housing project assisted

25 under an existing contract under section 8 of the United
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1 States Housing Act of 1937 that is attached to the struc2 ture pursuant to subsection (d)(2) of such section and,

3 with respect to each such project, to determine—

4 (1) the amount of such assistance provided for

5 the project and for each assisted dwelling unit in the

6 project and the remaining term of such contract for

7 assistance;

8 (2) the physical status and needs for the

9 project;

10 (3) the financial status of the project, includ11 ing—

12 (A) whether the project is subject to a

13 mortgage insured under the National Housing

14 Act and, if so, the program under which such

15 insurance is provided, whether the loan secured

16 by the mortgage is delinquent, in default, or

17 current, and if delinquent or in default, the

18 amount of arrears, outstanding balance, inter19 est rate, and remaining term of the delinquent

20 or defaulted loan;

21 (B) recent project income and expenses

22 and the amount of the balance in any reserve

23 accounts for the project;

24 (C) the estimated cost of any rehabilitation

25 necessary to maintain the project in accordance
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1 with applicable building and safety standards

2 and codes or to bring the project into compli3 ance with such standards and codes;

4 (D) the amount of monthly rental revenue

5 necessary per dwelling unit to fully support the

6 sum of rehabilitation costs under subparagraph

7 (C) for the project, the costs of operating the

8 project, and the costs of maintaining the project

9 in accordance with applicable building and safe10 ty standards;

11 (E) the estimated revenue losses resulting

12 from vacancies in dwelling units in the project;

13 and

14 (F) the extent of financial investment and

15 interest in the project of the owner of the

16 project and of the extent of control by the

17 owner over the management of the project; and

18 (4) the rents for comparable unassisted dwell19 ing units in the area in which the project is located.

20 (b) REPORT.—Not later than the expiration of the

21 period referred to in subsection (a), the Resolution Admin22 istrator shall submit a report to the Congress containing

23 the results of the audit conducted under such subsection.
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1 Subtitle B—Interim Program for

2 Public Housing Block Grants

3 and Deregulation

4 SEC. 321. IMMEDIATE TERMINATION OF EXISTING PUBLIC

5 HOUSING PROGRAMS.

6 After the date of the enactment of this Act, no new

7 commitment may be made to provide financial assistance

8 under any of the following programs:

9 (1) PUBLIC HOUSING.—Any program for assist10 ance for public housing under any provision of title

11 I or III of the United States Housing Act of 1937.

12 (2) URD GRANTS.—The urban revitalization

13 program under the Departments of Veterans Affairs

14 and Housing and Urban Development, and Inde15 pendent Agencies Appropriations Act, 1993 (Public

16 Law 102–389; 106 Stat. 1579).

17 (3) CHILDHOOD DEVELOPMENT.—The program

18 for public housing childhood development under sec19 tion 222 of the Housing and Urban-Rural Recovery

20 Act of 1983.

21 (4) PERINATAL SERVICES DEMONSTRATION.—

22 The public housing one-stop perinatal services dem23 onstration under section 521 of the Cranston-Gon24 zalez National Affordable Housing Act.
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1 (5) YOUTH SPORTS DEMONSTRATION.—The

2 program for public and assisted housing youth

3 sports under section 520 of the Cranston-Gonzalez

4 National Affordable Housing Act.

5 (6) DRUG ELIMINATION.—The program for

6 public and assisted housing drug elimination under

7 chapter 2 of subtitle C of title V of the Anti-Drug

8 Abuse Act of 1988.

9 SEC. 322. PROGRAM AUTHORITY.

10 (a) IN GENERAL.—Notwithstanding any provisions of

11 the United States Housing Act of 1937, during the transi12 tion period, this subtitle shall govern the funding, oper13 ation, and management of public housing, and the trans14 formation of public housing to a program of tenant-based

15 voucher assistance under title II of this Act. Title I of

16 the United States Housing Act of 1937 shall apply only

17 to the extent that the Resolution Administrator deter18 mines that such title is consistent with the effective and

19 expeditious achievement of the purposes of this title.

20 (b) DEREGULATION.—The Resolution Administrator

21 shall provide public housing agencies with the flexibility

22 and, to the extent amounts are made available in appro23 priations Acts for grants under this subtitle, the funding

24 necessary to allow the agencies—
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1 (1) to make their viable and marketable public

2 housing stock generally competitive, in preparation

3 for their transition to the voucher assistance under

4 title II; and

5 (2) to demolish, dispose of, or demolish and dis6 pose of their nonviable or nonmarketable housing

7 property.

8 In carrying out this subtitle, the Resolution Administrator

9 shall deregulate and decontrol public housing agencies

10 consistent with the requirements of this subtitle, the pru11 dent operation of such agencies, and the purpose under

12 section 301.

13 (c) INDIAN HOUSING PROGRAMS.—This subtitle shall

14 not apply to low-income housing developed or operated

15 pursuant to a contract between the Secretary of Housing

16 and Urban Development and an Indian housing authority.

17 SEC. 323. STRATEGIC PLAN.

18 (a) IN GENERAL.—As a condition of eligibility for as19 sistance under this subtitle, a public housing agency shall

20 develop a strategic plan under this section that deter21 mines—

22 (1) the location, physical condition, moderniza23 tion needs, and marketability of each of the public

24 housing projects of the agency; and
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1 (2) the manner in which the public housing of

2 the agency relates to the overall local stock of af3 fordable housing in the community in which the ju4 risdiction of the agency is located.

5 (b) MINIMUM REQUIREMENTS.—The plan under this

6 section of a public housing agency shall—

7 (1) be developed in consultation with appro8 priate local officials, tenants of the public housing

9 projects for which assistance is requested, residents

10 of the local community, and other appropriate inter11 ested parties;

12 (2) identify the public housing projects that the

13 agency plans to demolish;

14 (3) identify the public housing projects that the

15 agency plans to rehabilitate, and provide a schedule

16 for such rehabilitation;

17 (4) set forth the plan of the agency for comply18 ing with the provisions of this subtitle and for the

19 transition of the public housing of the agency to

20 voucher assistance under title II, including any re21 quests for waivers of program requirements under

22 section 329(a);

23 (5) describe how the assistance requested under

24 this subtitle will be used by the agency to improve

25 the management and operation of the agency and to
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1 improve the condition of the public housing projects

2 for which such assistance is requested;

3 (6) describe how the assistance requested under

4 this subtitle will be used by the agency to assist ten5 ant programs and services in the public housing

6 projects for which such assistance is sought;

7 (7) describe any other sources of funds, not

8 provided under this subtitle, to be used by the public

9 housing agency to carry out any eligible activities

10 under section 327;

11 (8) describe any previous assistance provided by

12 the Secretary of Housing and Urban Development

13 under title I of the United States Housing Act of

14 1937 will be used for the purposes of this subtitle;

15 and

16 (9) include such other information as the Reso17 lution Administrator may require.

18 (c) REQUIREMENTS FOR SMALL PUBLIC HOUSING

19 AGENCIES.—The Resolution Administrator may establish

20 requirements for strategic plans under this section that

21 provide for public housing agencies with fewer than 100

22 units, to submit more simplified plans than those required

23 to be submitted by larger public housing agencies.

24 (d) REVIEW AND APPROVAL.—The Resolution Ad25 ministrator shall review each plan submitted under this
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1 section for compliance with the requirements of this sec2 tion and this subtitle and shall approve the plans that so

3 comply. The Resolution Administrator may require a pub4 lic housing agency to amend or resubmit a plan under this

5 section if the plan, as initially submitted, does not so com6 ply.

7 (e) USE.—A public housing agency shall use the stra8 tegic plan of the agency approved under this section to

9 guide any investment decisions of the agency during the

10 transition period.

11 SEC. 324. CONSOLIDATION OF FUNDING.

12 (a) CONSOLIDATION OF FUNDING.—All programs

13 under which assistance is provided for public housing im14 mediately before the commencement of the transition pe15 riod (including each program referred to in section 321)

16 shall, upon such commencement, be merged into the Pub17 lic Housing Block Grant Fund under section 325.

18 (b) TREATMENT OF EXISTING AMOUNTS.—

19 (1) UNRESERVED AMOUNTS.—Any amounts

20 made available to the Secretary of Housing and

21 Urban Development for public housing purposes that

22 have not been reserved by the Secretary to a public

23 housing agency before the commencement of the

24 transition period shall be available, for the period
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1 originally provided in law, for use for block grants

2 under this subtitle.

3 (2) RESERVED AMOUNTS.—Any amounts made

4 available to the Secretary of Housing and Urban

5 Development for public housing purposes that have

6 been obligated by the Secretary to a public housing

7 agency, but which, as of the commencement of the

8 transition period, have not been obligated by the

9 public housing agency, shall be available to such

10 public housing agency, for the period originally pro11 vided in law, for use as block grant amounts under

12 this subtitle.

13 (c) CONTINUED AVAILABILITY.—If a public housing

14 agency receives amounts under this subtitle for purposes

15 described in the public housing agency’s strategic plan

16 that relate to a particular project or projects, or portion

17 thereof, such amounts shall be available to the agency

18 until expended, regardless of whether project or projects,

19 or portions of the project or projects, have been trans20 ferred under subtitle A to voucher assistance under title

21 II.

22 SEC. 325. PUBLIC HOUSING BLOCK GRANT FUND.

23 The Resolution Administrator shall establish a Public

24 Housing Block Grant Fund for the purpose of making

25 grants to public housing agencies—
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1 (1) to make physical improvements to or to re2 place public housing projects;

3 (2) for associated management improvements;

4 and

5 (3) for the operation of low-income housing

6 projects.

7 SEC. 326. GRANTS.

8 (a) IN GENERAL.—The Resolution Administrator

9 shall make grants from amounts in the Public Housing

10 Block Grant Fund to public housing agencies to carry out

11 eligible activities under section 327.

12 (b) STRATEGIC PLAN REQUIREMENT.—No amounts

13 may be provided under this subtitle to a public housing

14 agency unless the Resolution Administrator has approved

15 a strategic plan for the agency under section 323.

16 (c) AMOUNT.—The amount of the block grant under

17 this subtitle for a public housing agency for a fiscal year

18 shall be the amount of the allocation under section 328

19 for the agency for such fiscal year.

20 (d) CONDITIONS OF BLOCK GRANT ASSISTANCE.—

21 With respect to public housing projects assisted under this

22 subtitle, the requirements of this subtitle (and the condi23 tions of the strategic plan relating to the housing) shall

24 apply for the longer of—
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1 (1) 20 years after the date of the execution of

2 the contract for the first grant under this subtitle

3 from which amounts were used for the development

4 of the housing; or

5 (2) 10 years after the receipt of the last grant

6 under this subtitle from which amounts were used

7 for operation of the project.

8 SEC. 327. ELIGIBLE ACTIVITIES.

9 Amounts from a grant under this subtitle may be

10 used to carry out the following activities:

11 (1) OPERATING ACTIVITIES.—Activities relating

12 to—

13 (A) the operation of low-income housing

14 projects;

15 (B) crime prevention and security (includ16 ing activities eligible for assistance under the

17 Public and Assisted Housing Drug Elimination

18 Act of 1990 and the Drug-Free Public Housing

19 Act of 1988) for low-income housing projects;

20 and

21 (C) the provision of service coordinators

22 under section 671 of the Housing and Commu23 nity Development Act of 1992 for elderly per24 sons or persons with disabilities in low-income

25 housing projects.
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1 (2) CAPITAL AND MANAGEMENT ACTIVITIES.—

2 (A) Capital and management activities au3 thorized under title I of the United States

4 Housing Act of 1937 (except for sections 8 and

5 9).

6 (B) Any other activities relating to the de7 velopment and modernization of public housing

8 projects, including the redesign, reconstruction,

9 and reconfiguration of public housing sites and

10 buildings, vacancy reduction, addressing de11 ferred maintenance needs and the replacement

12 of dwelling equipment, planned code compli13 ance, management improvements, community

14 service, demolition and replacement, tenant re15 location, and activities to improve the economic

16 empowerment and self-sufficiency of public

17 housing tenants.

18 (C) Activities under the urban revitaliza19 tion demonstration program authorized under

20 Public Laws 102–389, 103–124, or 103–327.

21 (D) Activities under the public housing

22 early childhood development program author23 ized under section 222 of the Housing and

24 Urban-Rural Recovery Act of 1983.
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1 (E) Providing technical assistance to pub2 lic housing agencies, resident councils, resident

3 organizations, and resident management cor4 porations, including monitoring, inspections,

5 training for public housing agency employees

6 and residents, and data collection and analysis.

7 (F) Remedial activities associated with

8 troubled public housing agencies, as such agen9 cies are so designated under section 6(j) of the

10 United States Housing Act of 1937.

11 (G) Such other activities as may be deter12 mined by the Resolution Administrator.

13 The provisions and requirements of any laws re14 ferred to in this subsection shall not apply to activi15 ties assisted with block grants made under this sub16 title, except as determined necessary by the Resolu17 tion Administrator.

18 SEC. 328. FORMULA ALLOCATIONS.

19 (a) IN GENERAL.—For each fiscal year, the Resolu20 tion Administrator shall allocate any amounts available

21 under this subtitle for block grants for the fiscal year to

22 public housing agencies eligible for such grants under sec23 tion 326(b). The allocation for an eligible public housing

24 agency for a fiscal year shall be the sum of the operating

25 amount under subsection (b) for the agency for such year
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1 and the capital amount under subsection (c) for the agen2 cy for such year.

3 (b) OPERATING AMOUNT.—

4 (1) IN GENERAL.—The Resolution Adminis5 trator shall allocate 40 percent of any amounts

6 available under this subtitle for block grants for a

7 fiscal year to eligible public housing agencies accord8 ing to a formula established under this subsection by

9 the Resolution Administrator. The formula alloca10 tion under this subsection for a public housing agen11 cy for a fiscal year is the operating amount for such

12 agency for such year.

13 (2) MODIFICATION OF PFS FORMULA.—For

14 purposes of determining operating amounts under

15 this subsection, the Resolution Administrator shall

16 modify the Performance Funding System formula,

17 as prescribed by the Resolution Administrator in

18 regulations pursuant to section 9 of the United

19 States Housing Act of 1937, to—

20 (A) include components reflecting the new

21 list of eligible activities set forth in section

22 327(1);

23 (B) simplify the requirements relating to

24 public housing agencies with 100 or fewer units;
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1 (C) revise the treatment of ‘‘other income’’

2 in a manner that gives public housing agencies

3 an incentive to increase such income;

4 (D) eliminate the ‘‘rental income increase’’

5 factor used in calculating Performance Funding

6 System eligibility; and

7 (E) provide that the treatment of vacant

8 public housing units under the formula may be

9 modified by negotiated rulemaking.

10 In modifying the Performance Funding System for11 mula under this paragraph, the Resolution Adminis12 trator may give special consideration to the needs of

13 public housing agencies for anticrime funding and

14 funding of activities related to the provision of serv15 ice coordinators for elderly persons or persons with

16 disabilities pursuant to section 671 of the Housing

17 and Community Development Act of 1992.

18 (3) USE OF EXISTING PFS FORMULA.—Until

19 the Performance Funding System formula as revised

20 under paragraph (2) takes effect, the Resolution Ad21 ministrator shall use the formula established pursu22 ant to section 9(a)(3) of the United States Housing

23 Act of 1937 for purposes of determining the operat24 ing amounts under this subsection.

25 (c) CAPITAL AMOUNT.—
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1 (1) IN GENERAL.—The Resolution Adminis2 trator shall allocate 60 percent of any amounts

3 available under this subtitle for block grants for a

4 fiscal year to eligible public housing agencies accord5 ing to a formula established under this subsection by

6 the Resolution Administrator. The formula shall be

7 designed to measure the relative needs of such agen8 cies for capital and modernization assistance and

9 shall allocate amounts to address the backlog needs

10 and accrual needs of public housing agencies, taking

11 into consideration all activities eligible for assistance

12 under section 327(2). The formula allocation under

13 this subsection for a public housing agency for a fis14 cal year is the capital amount for such agency for

15 such year.

16 (2) FORMULA FOR SMALL PUBLIC HOUSING

17 AGENCIES.—The Resolution Administrator may es18 tablish a separate allocation formula under this sub19 section for public housing agencies with fewer than

20 100 units, which may take into account the specific

21 needs of such smaller public housing agencies.

22 (3) AUTHORITY TO USE CURRENT FORMULA.—

23 In carrying out this subsection, the Resolution Ad24 ministrator may use the formula established under

25 section 14(k) of the United States Housing Act of
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1 1937, with such adjustments as may be necessary to

2 provide additional weight for backlog needs. The

3 Resolution Administrator may make the adjustments

4 to such formula by notice and without amending the

5 regulations implementing such section.

6 SEC. 329. PROGRAM REQUIREMENTS AND WAIVERS.

7 (a) WAIVER OF PROGRAM REQUIREMENTS.—

8 (1) AUTHORITY.—The Resolution Adminis9 trator may waive, for a public housing agency receiv10 ing assistance under this subtitle, any of the follow11 ing requirements under title I:

12 (A) INCOME ELIGIBILITY.—Any require13 ment relating to maximum income of families

14 residing in public housing.

15 (B) RENT CHARGES.—Any requirement re16 lating to rental amounts for dwelling units in

17 public housing.

18 (C) OCCUPANCY PREFERENCES.—Any re19 quirement relating to preference for occupancy

20 in public housing dwelling units.

21 (D) DEMOLITION AND DISPOSITION.—Any

22 requirement relating to demolition and disposi23 tion of public housing.

24 (2) REQUIREMENTS.—The Resolution Adminis25 trator may waive requirements referred to in para-
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1 graph (1) only pursuant to a request made by a

2 public housing agency contained in the strategic plan

3 under section 323 for the agency and only if the

4 Resolution Administrator determines that the plan

5 provides an effective and efficient means of—

6 (A) providing low-income housing for low7 income families in the area served by the public

8 housing agency;

9 (B) operating the public housing of the

10 agency;

11 (C) transition from block grant assistance

12 under this subtitle for the agency to voucher as13 sistance under title II; and

14 (D) assisting families currently eligible for

15 and residing in public housing of the agency.

16 (b) WAIVER OF PROCUREMENT REQUIREMENTS.—

17 The Resolution Administrator may waive any Federal,

18 State, or local procurement requirements applicable to a

19 public housing agency engaging in any activity authorized

20 by this subtitle, as the Resolution Administrator considers

21 necessary. In order to avoid duplication of such require22 ments among jurisdictions, the Resolution Administrator

23 may apply the procurement requirements of only one juris24 diction.
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1 (c) MODIFICATION OF LEAD-BASED PAINT REQUIRE2 MENTS.—Consistent with the purposes of this subtitle and

3 the protection of children from lead-based paint hazards,

4 the Resolution Administrator shall—

5 (1) determine which, if any, of the lead-based

6 paint testing and abatement requirements for public

7 housing in the Lead-Based Paint Poisoning Preven8 tion Act shall apply to public housing during the pe9 riod that is assistance is provided for such housing

10 under this subtitle; and

11 (2) adopt for public housing, for such period,

12 appropriate recommendations made by the Task

13 Force on Lead-Based Paint Hazard Reduction and

14 Financing.

15 (d) APPLICABILITY OF FAMILY SELF-SUFFICIENCY

16 REQUIREMENTS.—Participation in the Family Self-Suffi17 ciency program under section 23 of the United States

18 Housing Act of 1937 shall not be mandatory with respect

19 to any housing developed with amounts provided under

20 this subtitle. Parties to financial and other contractual

21 commitments made under the Family Self-Sufficiency pro22 gram prior to the allocation or obligation of amounts

23 under this title shall continue to be bound by the terms

24 of such commitments.
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1 SEC. 330. AUTHORIZATION OF APPROPRIATIONS.

2 There are authorized to be appropriated to the Public

3 Housing Grant Fund under section 325 for grants under

4 this subtitle—

5 (1) $5,270,000,000 for fiscal year 1996;

6 (2) $3,300,000,000 for fiscal year 1997;

7 (3) $1,500,000,000 for fiscal year 1998; and

8 (4) $56,000,000 for fiscal year 1999.

9 Subtitle C—General Provisions

10 SEC. 341. DEFINITIONS.

11 For purposes of this title, the following definitions

12 shall apply:

13 (1) RESOLUTION ADMINISTRATOR.—The term

14 ‘‘Resolution Administrator’’ means the Adminis15 trator of the Housing and Urban Development Pro16 grams Resolution Agency appointed under section

17 101.

18 (2) TRANSITION PERIOD.—The term ‘‘transi19 tion period’’ means the period beginning on October

20 1, 1995, and ending on September 30, 2000.

21 (3) VOUCHER ADMINISTRATOR.—The term

22 ‘‘Voucher Administrator’’ means the Administrator

23 of the Office of Federal Housing Voucher Assistance

24 of the Department of Health and Human Services,

25 appointed under section 262.
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1 TITLE IV—BLOCK GRANTS FOR

2 HOUSING AND COMMUNITY

3 DEVELOPMENT OPPORTUNI4 TIES

5 Subtitle A—Block Grants Program

6 SEC. 401. PURPOSE.

7 The purpose of this subtitle is to provide assistance

8 to eligible States, entitlement areas, and Indian tribes, to

9 be used in such manner and amounts as the States, enti10 tlement areas, and tribes determine appropriate, for meet11 ing the community and economic development needs and

12 the affordable housing needs of the States, entitlement

13 areas, and tribes.

14 SEC. 402. GENERAL BLOCK GRANTS.

15 Except as provided in section 432, for each fiscal

16 year, the Director of the Housing and Community Oppor17 tunities Agency shall make a grant to each eligible State

18 and entitlement area in an amount equal to the allocation

19 determined under section 406 for such State or entitle20 ment area for the fiscal year and shall provide amounts

21 to Indian tribes in accordance with section 406(b).

22 SEC. 403. ELIGIBLE STATES AND ENTITLEMENT AREAS.

23 (a) ELIGIBLE STATE.—For purposes of this title, the

24 term ‘‘eligible State’’ means, with respect to a fiscal year,

25 a State that, during the period immediately preceding the
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1 fiscal year and having such duration as the Director shall

2 determine, has submitted to the Director a block grant

3 plan under section 405.

4 (b) ENTITLEMENT AREA.—For purposes of this title,

5 the term ‘‘entitlement area’’ means, with respect to a fis6 cal year, a metropolitan city or urban county that, during

7 the period immediately preceding the fiscal year and hav8 ing such duration as the Director shall determine, has sub9 mitted to the Director a block grant plan under section

10 405.

11 SEC. 404. USE OF GRANT AMOUNTS.

12 (a) LIMITATION ON USE.—Grant amounts provided

13 under this subtitle may be used, subject to this title, only

14 to carry out eligible activities.

15 (b) LOW-INCOME USE.—

16 (1) IN GENERAL.—Not less than 90 percent of

17 the aggregate amount of assistance provided to an

18 eligible State, entitlement area, or Indian tribe

19 under a grant made under this subtitle shall be used

20 for the support of eligible activities that benefit low21 income families.

22 (2) DETERMINATION.—An eligible activity shall

23 be considered to benefit low-income families only if

24 such activity—
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1 (A) is carried out in a neighborhood con2 sisting predominately of low-income families

3 and provides services for such families;

4 (B) involves housing or facilities for use

5 predominately by low-income families;

6 (C) involves employment of persons, a ma7 jority of whom are members of low-income fam8 ilies; or

9 (D) is designed to serve an area generally

10 and is clearly designed to meet needs of low-in11 come families in such area.

12 (3) HOUSING ACTIVITIES.—An affordable hous13 ing activity under subsection (e) that provides dwell14 ing units and is assisted with grant amounts under

15 this subtitle shall be considered to benefit low-in16 come families only to the extent such housing will,

17 upon completion, be occupied by such families.

18 (c) ELIGIBLE ACTIVITIES.—An activity shall be con19 sidered an eligible activity for purposes of this subtitle

20 only if the activity is a community or neighborhood devel21 opment activity under subsection (d), an affordable hous22 ing activity under subsection (e), or a relocation activity

23 under subsection (f).

24 (d) COMMUNITY AND NEIGHBORHOOD DEVELOP25 MENT ACTIVITIES.—A community or neighborhood devel-
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1 opment activity under this subsection is an activity di2 rected toward encouraging or assisting the development of

3 viable neighborhoods and communities, providing decent

4 housing and a suitable living environment, or expanding

5 economic opportunities for families, neighborhoods, or

6 communities, which shall include the following activities

7 to carry out such purposes:

8 (1) PROPERTIES.—Acquisition and disposition

9 of property and construction, reconstruction, and in10 stallation of properties and other facilities, for public

11 purposes.

12 (2) CODE ENFORCEMENT AND REMOVAL.—

13 Code enforcement and clearance, demolition, re14 moval, and rehabilitation of buildings and improve15 ments.

16 (3) PUBLIC SERVICES.—Provision of public

17 services not previously provided, except that not

18 more that 15 percent of the amount of any assist19 ance under this subtitle to an eligible State or In20 dian tribe may be used for activities under this para21 graph.

22 (4) PLANNING AND TECHNICAL ASSISTANCE.—

23 Community and neighborhood development planning,

24 technical assistance, training, and capacity-building

25 activities.
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1 (5) ECONOMIC DEVELOPMENT.—Economic de2 velopment projects that create or retain employment

3 or business opportunities or provide goods or serv4 ices, for low-income families.

5 (6) NEIGHBORHOOD DEVELOPMENT.—Provision

6 of assistance to neighborhood development organiza7 tions, local development corporations, and neighbor8 hood-based nonprofit organizations to support neigh9 borhood development and revitalization activities.

10 (7) MATCHING AMOUNTS.—Payment of the

11 non-Federal share required in connection with a

12 Federal grant-in-aid program undertaken as part of

13 activities assisted with amounts provided under this

14 subtitle.

15 (e) AFFORDABLE HOUSING ACTIVITIES.—

16 (1) IN GENERAL.—An affordable housing activ17 ity under this subsection is an activity to assist the

18 development of, or to support, affordable rental

19 housing or affordable homeownership opportunities

20 through the following activities:

21 (A) AFFORDABLE HOUSING DEVELOP22 MENT.—The provision of assistance for acquisi23 tion, new construction, reconstruction, or mod24 erate or substantial rehabilitation of affordable

25 housing, including assistance for real property
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1 acquisition, site improvement, conversion, demo2 lition, financing costs, administrative and plan3 ning costs, and other expenses.

4 (B) TENANT-BASED ASSISTANCE.—The

5 provision of financial assistance to or on behalf

6 of low-income families for costs of such families

7 of renting or owing dwelling units, but only if

8 such assistance is not limited to use for a par9 ticular dwelling.

10 (C) HOMEOWNERSHIP ASSISTANCE.—The

11 provision of financial assistance to or on behalf

12 of low-income first-time homebuyers, including

13 providing direct mortgage loans and second

14 mortgage loans, interest rate buy downs, down15 payment assistance, mortgage insurance or

16 guarantees, and other assistance.

17 (D) HOMEOWNERSHIP PROGRAMS.—Plan18 ning, organizing, establishing, or carrying out

19 programs for affordable housing homeowner20 ship.

21 (E) HOUSING COUNSELING.—Counseling

22 regarding affordable rental or homeownership

23 opportunities, responsibilities of tenancy and

24 homeownership, or avoiding foreclosure, or

25 training and certifying such counselors.
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1 (F) LEAD-BASED PAINT HAZARD REDUC2 TION.—Activities to evaluate or reduce hazards

3 in affordable housing resulting from lead-based

4 paint.

5 (G) TECHNICAL, CAPACITY-BUILDING, AND

6 OUTREACH ASSISTANCE.—The provision of

7 technical, administrative, or organizational as8 sistance for, or assistance for operating ex9 penses of, community housing development or10 ganizations or other organizations supporting,

11 providing, or facilitating affordable housing, or

12 other assistance to increase the capacity of or

13 encourage public or private organizations, insti14 tutions, or agencies to support, develop, or fa15 cilitate affordable housing.

16 (H) EDUCATION AND RESEARCH.—Edu17 cational, training, informational, or research ac18 tivities to facilitate or assist the development or

19 support of affordable housing.

20 (I) CHILD DEVELOPMENT.—Childhood de21 velopment services in or near affordable housing

22 for low-income families residing in the housing.

23 (J) DRUG ELIMINATION.—Security or law

24 enforcement activities for affordable housing.
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1 (2) TARGETING.—Affordable housing activities

2 under this subsection may include activities relating

3 to—

4 (A) affordable housing that is primarily or

5 specifically for elderly families, disabled fami6 lies, homeless families, persons with acquired

7 immunodeficiency syndrome or related diseases

8 and their families, or Indian families;

9 (B) affordable housing constructed, reha10 bilitated, maintained, or operated in connection

11 with job training, educational, or youth-oriented

12 programs; and

13 (C) affordable housing provided in the

14 form of single family homes, multifamily hous15 ing, single room occupancy housing, shared

16 housing, community residences, congregate

17 housing, group homes, mixed housing, support18 ive housing, emergency and overnight shelters,

19 transitional housing, permanent housing, and

20 other housing.

21 (3) AFFORDABILITY.—An eligible State, entitle22 ment area, or Indian tribe receiving grant amounts

23 under this subtitle and using such amounts as pro24 vided in this subsection for assistance or support of

25 affordable housing shall have the sole responsibility
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1 for establishing requirements or limitations relating

2 to the affordability of housing for which assistance

3 or support is provided or activities are conducted

4 using such grant amounts.

5 (f) RELOCATION ACTIVITIES.—A relocation activity

6 under this subsection is an activity to relocate any family,

7 person, business, or organization displaced by activities as8 sisted under this subtitle.

9 (g) ADMINISTRATIVE COSTS.—Each eligible activity

10 under subsection (d), (e), or (f) shall be considered, for

11 purposes of this subtitle, to include payment of reasonable

12 administrative costs relating to carrying out such activity.

13 (h) MANNER OF USE.—Grant amounts provided

14 under this subtitle may be used in support of eligible ac15 tivities in any manner determined appropriate by the eligi16 ble State, entitlement area, or Indian tribe receiving the

17 grant, including (1) providing grants, capital assistance,

18 loans, and subsidies, (2) providing payment or collateral

19 for or insurance or guarantee of loans, notes, and obliga20 tions (including assistance or collateral for State-issued

21 housing bonds or projects financed by such bonds), and

22 (3) carrying out activities directly or by contract.

23 (i) TRANSFER TO OTHER ENTITIES.—An eligible

24 State, entitlement area, or Indian tribe that receives grant

25 amounts under this subtitle may distribute such amounts
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1 to other entities for carrying out eligible activities, except

2 that the State, entitlement area, or tribe shall be respon3 sible for ensuring that the grant amounts are used in ac4 cordance with this section.

5 (j) REQUIRED USE AS COLLATERAL FOR CDBG

6 LOAN GUARANTEES.—For any eligible State or entitle7 ment area that, at the time of the receipt of grant

8 amounts under this subtitle, has outstanding (or within

9 which is located any eligible public entity, or any public

10 entity designated by an eligible public entity, that has out11 standing) any notes or obligations guaranteed under sec12 tion 108 of the Housing and Community Development Act

13 of 1974 (as such section was in effect immediately before

14 the effective date under section 451), the receipt of such

15 grant amounts by the State or entitlement area shall be

16 considered to constitute a pledge by the State or area of

17 such amounts and any grant to which the State or area

18 may become eligible under this subtitle to assure the re19 payment of such notes and obligations. For purposes of

20 this subsection, the term ‘‘eligible public entity’’ has the

21 meaning given the term in section 108(o) of such Act (as

22 in effect at such time).

23 (k) ADDITIONAL ELIGIBLE USES FOR INDIAN

24 TRIBES.—Notwithstanding subsection (c), with respect to

25 an Indian tribe that receives grant amounts under this
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1 subtitle, an activity shall be considered an eligible activity

2 for purposes of this subtitle if the activity is—

3 (1) an activity described in subsection (d), (e),

4 or (f); or

5 (2) an activity to provide low-income housing on

6 an Indian reservation or other Indian area that, im7 mediately before the effective date under section

8 451, would have been eligible for assistance under a

9 contract between the Secretary of Housing and

10 Urban Development and an Indian housing author11 ity the United States Housing Act of 1937.

12 SEC. 405. BLOCK GRANT PLAN.

13 (a) IN GENERAL.—A block grant plan under this

14 subsection is a written document that—

15 (1) describes the long- and short-term objec16 tives of the State or entitlement area in using grant

17 amounts provided under this subtitle and section

18 421 and projected uses of such amounts for the fis19 cal year;

20 (2) in the case of a State that will distribute

21 grant amounts to units of general local government,

22 describes the method by which the State will conduct

23 such distribution;

24 (3) contains a certification by the chief execu25 tive officer of the State or entitlement area that—
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1 (A) grant amounts will be used only as

2 provided in this title;

3 (B) the State or entitlement area will com4 ply with the requirements of this title; and

5 (C) in the case of a State, the State will

6 monitor recipients of grant amounts distributed

7 by the State to ensure compliance with this

8 title; and

9 (4) contains a certification the grant and activi10 ties funded with grant amounts will be administered

11 and conducted in conformity with the Civil Rights

12 Act of 1964 and the Fair Housing Act, and the

13 State or entitlement area will affirmatively further

14 fair housing.

15 (b) EFFECT OF STATEMENT OF OBJECTIVES AND

16 USES.—Descriptions provided pursuant to paragraph (1)

17 and (2) of subsection (a) shall not be binding with respect

18 to the use or distribution of grant amounts provided under

19 this title.

20 SEC. 406. ALLOCATION OF BLOCK GRANT AMOUNTS.

21 (a) IN GENERAL.—For a fiscal year, the Director

22 shall allocate the total amount available for allocation for

23 such year for grants under this subtitle among eligible

24 States and entitlement areas and for Indian tribes in ac25 cordance with this section. The Director shall determine
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1 the allocation for each eligible State using the formula in

2 subsection (c) and the allocation for each entitlement area

3 using the formula in subsection (d). The total amount

4 available for grants under this subtitle for a fiscal year

5 shall be the amount remaining from the total amount

6 made available for use under this title in appropriation

7 Acts for the year, after amounts are reserved for grants

8 under subtitle B.

9 (b) SET-ASIDE FOR INDIAN TRIBES.—

10 (1) IN GENERAL.—For each fiscal year, of the

11 total amount available for the fiscal year for grants

12 under this subtitle, the Director shall reserve for

13 grants to Indian tribes 1 percent of such amount.

14 (2) DISTRIBUTION TO TRIBES.—The Director

15 shall provide for distribution of amounts reserved

16 under paragraph (1) to Indian tribes on the basis of

17 a competition conducted pursuant to specific criteria

18 for the selection of Indian tribes to receive such

19 amounts. The criteria shall be contained in a regula20 tion promulgated by the Director after notice and

21 public comment.

22 (3) CIVIL RIGHTS COMPLIANCE.—Assistance

23 may not be provided to an Indian tribe under this

24 subsection unless the tribe certifies to the Director

25 that any program using such assistance will be con-
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1 ducted and administered in conformity with title II

2 of the Civil Rights Act of 1968.

3 (c) ALLOCATION FOR STATES.—

4 (1) IN GENERAL.—Of the amount available for

5 a fiscal year for grants under this subtitle that re6 main after amounts are reserved under subsection

7 (b), the Director shall allocate 20 percent among the

8 eligible States as provided in subsection (e).

9 (2) DISTRIBUTION AND USE.—An eligible State

10 receiving a grant under this subtitle shall distribute

11 grant amounts to units of general local government

12 located in nonentitlement areas of the State to carry

13 out eligible activities in accordance with this title.

14 (d) ALLOCATION FOR ENTITLEMENT AREAS.—Of the

15 amount available for a fiscal year for grants under this

16 subtitle that remain after amounts are reserved under sub17 section (b), the Director shall allocate 80 percent to enti18 tlement areas as provided in subsection (e).

19 (e) ALLOCATION FORMULA.—The Director shall es20 tablish procedures for allocating amounts to States and

21 entitlement areas under this subsection, which shall allo22 cate such amounts according to the formula under section

23 106 of the Housing and Community Development Act of

24 1974 (as in effect immediately before the effective date

25 under section 108(a)) for allocating community develop-
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1 ment block grant amounts for States, metropolitan cities,

2 and urban counties.

3 Subtitle B—Block Grants for Hous4 ing for Special Populations and

5 Indian Housing

6 SEC. 421. BLOCK GRANTS FOR HOUSING FOR SPECIAL POP7 ULATIONS.

8 (a) IN GENERAL.—For each fiscal year, of the total

9 amount made available for use under this title in appro10 priation Acts for the year, the Director shall reserve for

11 grants under this section $1,000,000,000. Using such

12 amounts, the Director shall make a grant under this sec13 tion for such fiscal year to each eligible State in the

14 amount of the allocation for the State under subsection

15 (b).

16 (b) ALLOCATION.—For each fiscal year the Director

17 shall allocate amounts for grants under this section among

18 eligible States according to a formula established by the

19 Director to reflect each State’s share of the total need

20 among all States for housing for low-income families de21 scribed in subsection (c), as identified by objective meas22 ures of inadequate housing supply for such families, sub23 standard housing for such families, number of such fami24 lies in housing likely to be in need of rehabilitation, costs
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1 of producing housing for such families, and other condi2 tions.

3 (c) USE OF AMOUNTS.—Amounts from a grant under

4 this section may be used only to carry out affordable hous5 ing activities under section 404(e) relating to affordable

6 housing that is primarily or specifically for low-income el7 derly families, disabled families, or persons with acquired

8 immunodeficiency syndrome or related diseases and their

9 families. Such grant amounts shall be subject to the same

10 restrictions applicable to grant amounts that are provided

11 under section 402 and used for the purposes under this

12 subsection.

13 SEC. 422. BLOCK GRANTS FOR INDIAN HOUSING.

14 (a) IN GENERAL.—For each fiscal year, of the total

15 amount made available for use under this title in appro16 priation Acts for the year, the Director shall reserve for

17 grants under this section an amount not exceeding the

18 total amount provided in fiscal year 1995 for assistance

19 under the United States Housing Act of 1937 for Indian

20 housing authorities. Using such amounts, the Director

21 shall make a grant under this section for such fiscal year

22 to each eligible Indian housing authority in the amount

23 of the allocation under subsection (b) for the Indian hous24 ing authority for the fiscal year.
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1 (b) ALLOCATION.—The Director shall allocate

2 amounts made available for grants under this section for

3 a fiscal year among eligible Indian housing authorities as

4 follows:

5 (1) TRANSITION PERIOD.—For each of fiscal

6 years 1996, 1997, 1998, 1999, and 2000, the alloca7 tion for each eligible Indian housing authority shall

8 be an amount that bears the same proportion to

9 such total amount made available for the fiscal year

10 as the amount of assistance provided for fiscal year

11 1995 to such authority under the United States

12 Housing Act of 1937 bears to the total amount of

13 assistance provided for such fiscal year under such

14 Act to all Indian housing authorities.

15 (2) PERMANENT RULE.—For fiscal year 2001

16 and each fiscal year thereafter, the Director shall al17 locate amounts for grants under this section accord18 ing to a formula established by the Director to re19 flect each eligible Indian housing authority’s share

20 of the total need among all Indian housing authori21 ties for affordable housing in areas served by such

22 authorities, as identified by objective measures of in23 adequate housing supply, substandard housing, num24 ber of such families in housing likely to be in need
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1 of rehabilitation, costs of producing housing, and

2 other conditions.

3 (c) USE OF AMOUNTS.—Amounts from a grant under

4 this section may be used only to carry out affordable hous5 ing activities under section 404(e) to provide affordable

6 housing on Indian reservations and other Indian areas.

7 Such grant amounts shall be subject to the same restric8 tions applicable to grant amounts that are provided under

9 section 402 and used for the purposes under this sub10 section.

11 (d) ELIGIBLE INDIAN HOUSING AUTHORITIES.—For

12 purposes of this section, the term ‘‘eligible Indian housing

13 authority’’ means—

14 (1) with respect to fiscal year 1996, 1997,

15 1998, 1999, or 2000, an entity that was operating

16 as an Indian housing authority on June 1, 1995, for

17 purposes of the United States Housing Act of 1937;

18 and

19 (2) with respect to any fiscal year thereafter,

20 any Indian housing authority.

21 Subtitle C—General Provisions

22 Relating to Block Grants

23 SEC. 431. OVERSIGHT.

24 (a) STATE ACTIVITY REPORTS.—Each eligible State

25 and entitlement area that receives grant amounts under
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1 this title for a fiscal year shall submit to the Director,

2 in accordance with a schedule established by the Director,

3 a report regarding the use of grant amounts provided to

4 the State or area, which shall include—

5 (1) an assessment of the relation of the use of

6 grant amounts to the objectives identified in the

7 block grant plan of the State or entitlement area for

8 the fiscal year submitted under section 405;

9 (2) a description of accomplishments made by

10 projects funded with grant amounts; and

11 (3) an evaluation of the extent to which the

12 grant amounts were used for activities benefiting

13 low-income families.

14 (b) GAO AUDITS.—A State, entitlement area, unit of

15 general local government, Indian tribe, or Indian housing

16 authority may receive grant amounts under this title only

17 if the State, entitlement area, unit of general local govern18 ment, tribe, or authority agrees that—

19 (1) the Comptroller General of the United

20 States may audit the financial transactions of the

21 State, area, unit, tribe, or authority under the rules

22 and regulations prescribed by the Comptroller Gen23 eral, to the extent that such transactions relate to

24 grant amounts provided under this title; and
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1 (2) to facilitate such an audit, representatives

2 of the General Accounting Office shall have access

3 to all books, accounts, records, reports, files, and

4 other papers, things, or property belonging to or in

5 use by such State, area, unit, tribe, or authority per6 taining to such financial transactions.

7 SEC. 432. REMEDIES FOR NONCOMPLIANCE.

8 (a) IN GENERAL.—If the Director determines, on the

9 record and after opportunity for an agency hearing, that

10 grant amounts provided to a State, entitlement area, In11 dian tribe, or Indian housing authority have been used in

12 a manner substantially in violation of any provision of this

13 title, the Director shall—

14 (1) terminate grant payments under section

15 402 or 421 to the State or entitlement area, termi16 nate eligibility of the tribe for amounts under section

17 406(b), or terminate grant payments under section

18 422 to the Indian housing authority, as applicable;

19 (2) withhold from the State, entitlement area,

20 tribe, or Indian housing authority all or a portion of

21 amounts to be made available under this title to the

22 State, area, tribe, or authority;

23 (3) reduce the amount of future payments

24 under this title to the State, area, tribe, or authority

25 by an amount equal to the amounts provided under
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1 this title that were not expended in accordance with

2 this title; or

3 (4) limit the availability of amounts provided

4 under this title to programs, projects, or activities

5 not affected by such failure to comply.

6 (b) TERMINATION OF COMPLIANCE ACTION.—If the

7 Director takes action under subsection (a) with respect to

8 a State, entitlement area, Indian tribe, or Indian housing

9 authority, the Director shall, at time that the Director

10 first determines that the State, area, tribe, or authority

11 will comply with the provisions of this title—

12 (1) in the case of action under subsection

13 (a)(1), resume payments of assistance under this

14 title—

15 (A) to the State or entitlement area in the

16 full amount of the allocation under section 406

17 or 421 for the State or entitlement area,

18 (B) to the Indian tribe in the full amount

19 for which the tribe is eligible under section

20 406(b), or

21 (C) to the Indian housing authority in the

22 full amount for which the authority is eligible

23 under section 422,

24 as applicable;
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1 (2) in the case of action under subsection

2 (a)(2), make withheld amounts available to the

3 State, entitlement area, tribe, or authority, as the

4 Director considers appropriate to ensure that the

5 State, tribe, or authority complies with the provi6 sions of this title; or

7 (3) in the case of action under subsection

8 (a)(4), release such restrictions at the time that the

9 Director first determines that the State, entitlement

10 area, tribe, or authority will comply with the provi11 sions of this title.

12 (c) DEFICIT REDUCTION.—With respect to any fiscal

13 year, any amounts allocated under section 406, 421, or

14 422 for a State, entitlement area, Indian tribe, or Indian

15 housing authority that become available as a result of ac16 tions against the State, tribe, or authority under this sec17 tion (not including amounts withheld), shall be covered

18 into the General Fund of the Treasury of the United

19 States.

20 (d) CIVIL ACTION.—

21 (1) REFERRAL.—In lieu of, or in addition to,

22 any action authorized by subsection (a), if the Direc23 tor has reason to believe that a State, entitlement

24 area, Indian tribe, or Indian housing authority re25 ceiving amounts under this title has failed to comply
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1 substantially with any provision of this title, the Di2 rector may refer the matter to the Attorney General

3 of the United States with a recommendation that an

4 appropriate civil action be instituted.

5 (2) ACTION.—Upon such a referral the Attor6 ney General may bring a civil action in any United

7 States district court having venue thereof for such

8 relief as may be appropriate, including an action to

9 recover the amounts provided under this title which

10 were not expended in accordance with this title, or

11 for mandatory or injunctive relief.

12 (e) CIVIL ACTION TO REVIEW OF REMEDIAL AC13 TIONS.—Any State, entitlement area, Indian tribe, or In14 dian housing authority that receives notice under sub15 section (a) of the termination or reduction of payments

16 under this title may, within 60 days after receiving such

17 notice, file with the United States Court of Appeals for

18 the circuit in which such State is located, or in the United

19 States Court of Appeals for the District of Columbia, a

20 petition for review of the Director’s action. The petitioner

21 shall forthwith transmit copies of the petition to the Direc22 tor and the Attorney General of the United States, who

23 shall represent the Director in the litigation.
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1 SEC. 433. NONDISCRIMINATION.

2 (a) IN GENERAL.—No person in any State shall on

3 the ground of race, color, national origin, religion, or sex

4 be excluded from participation in, be denied the benefits

5 of, or be subjected to discrimination under any program

6 or activity funded in whole or in part with funds made

7 available under this title. Any prohibition against discrimi8 nation on the basis of age under the Age Discrimination

9 Act of 1975 or with respect to an otherwise qualified

10 handicapped individual as provided in section 504 of the

11 Rehabilitation Act of 1973 shall also apply to any such

12 program or activity.

13 (b) COMPLIANCE.—Whenever the Director deter14 mines that a State or entitlement area to which a grant

15 is made under this title has failed to comply with sub16 section (a), the Director shall notify the chief executive

17 officer of the State or entitlement area of the noncompli18 ance and shall request the chief executive officer to secure

19 compliance. If within a reasonable period of time, not to

20 exceed 60 days, the chief executive officer fails or refuses

21 to secure compliance, the Director may—

22 (1) refer the matter to the Attorney General

23 with a recommendation that an appropriate civil ac24 tion be instituted;

25 (2) exercise the powers and functions provided

26 by title VI of the Civil Rights Act of 1964;
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1 (3) take action under section 432; or

2 (4) take such other action as may be provided

3 by law.

4 (c) CIVIL ACTION.—When a matter is referred to the

5 Attorney General pursuant to subsection (b), or whenever

6 the Attorney General has reason to believe that a State

7 or entitlement area is engaged in a pattern or practice

8 in violation of the provisions of this section, the Attorney

9 General may bring a civil action in any appropriate United

10 States district court for such relief as may be appropriate,

11 including injunctive relief.

12 (d) EXCEPTION RELATING TO HAWAIIAN HOME

13 LANDS.—The provisions of this section and any certifi14 cation of compliance with civil rights laws required under

15 section 405 which relate to discrimination on the basis of

16 race shall not apply to the provision of assistance with

17 grant amounts to the Hawaiian Home lands.

18 (e) EXCEPTION RELATING TO INDIAN TRIBES.—The

19 Director may waive the applicability of the provisions of

20 this section in connection with assistance provided under

21 section 406(b) to Indian tribes or under section 422 to

22 Indian housing authorities.

23 SEC. 434. DEFINITIONS.

24 For purposes of this subtitle and subtitles A and B,

25 the following definitions shall apply:
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1 (1) DIRECTOR.—The term ‘‘Director’’ means

2 the Director of the Housing and Community Oppor3 tunities Agency established under subtitle D.

4 (2) INDIAN AREA.—The term ‘‘Indian area’’

5 means the area within which an Indian housing au6 thority is authorized to provide low-income housing.

7 (3) INDIAN HOUSING AUTHORITY.—The term

8 ‘‘Indian housing authority’’ means any entity that—

9 (A) is authorized to engage in or assist in

10 the development or operation of low-income

11 housing for Indians; and

12 (B) is established—

13 (i) by exercise of the power of self14 government of an Indian tribe independent

15 of State law; or

16 (ii) by operation of State law provid17 ing specifically for housing authorities for

18 Indians, including regional housing au19 thorities in the State of Alaska.

20 (4) INDIAN TRIBE.—The term ‘‘Indian tribe’’

21 means any Indian tribe, band, group, and nation, in22 cluding Alaska Indians, Aleuts, and Eskimos, and

23 any Alaskan Native Village, of the United States,

24 which is considered an eligible recipient under the

25 Indian Self-Determination and Education Assistance
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1 Act (Public Law 93–638) or was considered an eligi2 ble recipient under chapter 67 of title 31, United

3 States Code, prior to the repeal of such chapter.

4 (5) LOW-INCOME FAMILY.—The term ‘‘low-in5 come family’’ has the meaning given the term in

6 subtitle B of title II.

7 (6) METROPOLITAN CITY.—The term ‘‘metro8 politan city’’ has the same meaning given the term

9 in section 102(a) of the Housing and Community

10 Development Act of 1974 (as in effect immediately

11 before the effective date under section 108(a) of this

12 Act).

13 (7) NONENTITLEMENT AREA.—The term ‘‘non14 entitlement area’’ means an area which is not a met15 ropolitan city or part of an urban county and does

16 not include Indian tribes.

17 (8) STATE.—The term ‘‘State’’ means any

18 State of the United States, or any instrumentality

19 thereof approved by the chief executive officer, and

20 the Commonwealth of Puerto Rico.

21 (9) UNIT OF GENERAL LOCAL GOVERNMENT.—

22 The term ‘‘unit of general local government’’

23 means—
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1 (A) any city, county, town, township, par2 ish, village, or other general purpose political

3 subdivision of a State;

4 (B) Guam, the Northern Mariana Islands,

5 the Virgin Islands, and American Samoa, or a

6 general purpose political subdivision thereof;

7 (C) a combination of such political subdivi8 sions that is recognized by the Director; and

9 (D) the District of Columbia and the Trust

10 Territory of the Pacific Islands.

11 (10) URBAN COUNTY.—The term ‘‘urban coun12 ty’’ has the same meaning given the term in section

13 102(a) of the Housing and Community Development

14 Act of 1974 (as in effect immediately before the ef15 fective date under section 108(a) of this Act).

16 SEC. 435. REGULATIONS.

17 The Director may issue any regulations necessary to

18 carry out this subtitle and subtitles A and B.

19 SEC. 436. FUNDING.

20 (a) AUTHORIZATION OF APPROPRIATIONS.—There

21 are authorized to be appropriated for grants under this

22 title the following amounts:

23 (1) For fiscal year 1996, $5,000,000,000.

24 (2) For fiscal year 1997, $4,500,000,000.

25 (3) For fiscal year 1998, $4,000,000,000.
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1 (4) For fiscal year 1999, $3,500,000,000.

2 (5) For fiscal year 2000, $3,000,000,000.

3 (b) LIMITATION.—The aggregate amount of grants

4 provided under this title in any single fiscal year beginning

5 after fiscal year 1999 may not exceed $3,000,000,000.

6 SEC. 437. REPEALS.

7 (a) REPEALS.—The following provisions of law are

8 hereby repealed:

9 (1) CDBG AND UDAG.—Title I of the Housing

10 and Community Development Act of 1974 (42

11 U.S.C. 5301 et seq.).

12 (2) CDBG ASSISTANCE FOR COLONIAS.—Sec13 tion 916 of the Cranston-Gonzalez National Afford14 able Housing Act (42 U.S.C. 5306 note).

15 (3) YOUTHBUILD.—Subtitle D of title IV of the

16 Cranston-Gonzalez National Affordable Housing Act

17 (42 U.S.C. 12899 et seq.).

18 (4) NEIGHBORHOOD DEVELOPMENT.—Section

19 123 of the Housing and Urban-Rural Recovery Act

20 of 1983 (42 U.S.C. 5318 note).

21 (5) COMMUNITY OUTREACH PARTNERSHIPS.—

22 Section 851 of the Housing and Community Devel23 opment Act of 1992 (42 U.S.C. 5307 note).
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1 (6) HOME.—Titles I and II of the Cranston2 Gonzalez National Affordable Housing Act (42

3 U.S.C. 12704 et seq.).

4 (7) NATIONAL HOMEOWNERSHIP TRUST.—Sub5 title A of title III of the Cranston-Gonzalez National

6 Affordable Housing Act (42 U.S.C. 12851 et seq.).

7 (8) HOUSING COUNSELING.—Subsection (e) of

8 section 101 and section 106, of the Housing and

9 Urban Development Act of 1968 (12 U.S.C. 1701w,

10 1701x)).

11 (9) HOUSING FOR ELDERLY FAMILIES.—Sec12 tions 202 and 202a of the Housing Act of 1959 (12

13 U.S.C. 1701q, 1701q–1).

14 (10) ELDER COTTAGE HOUSING UNIT DEM15 ONSTRATION.—Section 806 of the Cranston-Gon16 zalez National Affordable Housing Act (42 U.S.C.

17 1701q note).

18 (11) HOUSING FOR DISABLED FAMILIES.—Sec19 tion 811 of the Cranston-Gonzalez National Afford20 able Housing Act (42 U.S.C. 8013).

21 (12) HOPE HOMEOWNERSHIP PROGRAMS.—Sec22 tions 401 and 402, and subtitles B and C of title

23 IV, of the Cranston-Gonzalez National Affordable

24 Housing Act (42 U.S.C. 1437aaa note, 12870 et

25 seq.).
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1 (13) INDIAN HOUSING LOAN GUARANTEES.—

2 Section 184 of the Housing and Community Devel3 opment Act of 1992 (12 U.S.C. 1515z–13a).

4 (14) LEAD-BASED PAINT HAZARD REDUCTION

5 GRANTS.—Section 1011 and part 1 of subtitle D of

6 title X of the Housing and Community Development

7 Act of 1992 (42 U.S.C. 4852, 4854 et seq.).

8 (15) HOMELESS HOUSING AND SHELTER AS9 SISTANCE.—Titles III and IV of the Stewart B.

10 McKinney Homeless Assistance Act (42 U.S.C.

11 11311 et seq.).

12 (16) INNOVATIVE HOMELESS INITIATIVES DEM13 ONSTRATION.—Section 2 of the HUD Demonstra14 tion Act of 1993 (42 U.S.C. 11301 note).

15 (17) HOUSING OPPORTUNITIES FOR PERSONS

16 WITH AIDS.—Subtitle D of title VIII of the Cran17 ston-Gonzalez National Affordable Housing Act (42

18 U.S.C. 12901 et seq.).

19 (18) CONGREGATE SERVICES.—Section 802 of

20 the Cranston-Gonzalez National Affordable Housing

21 Act (42 U.S.C. 8011) and title IV of the Housing

22 and Community Development Amendments of 1978

23 (42 U.S.C. 8001 et seq.).

24 (b) SAVINGS PROVISION.—Nothing in this section

25 may be construed to affect the validity of any right, duty,
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1 or obligation of the United States or other person arising

2 under or pursuant to any commitment or agreement en3 tered into before the effective date under section 451

4 under any provision repealed by subsection (a) of this sec5 tion.

6 (c) TREATMENT OF PREVIOUSLY OBLIGATED AS7 SISTANCE.—Notwithstanding subsection (a), any amounts

8 appropriated to carry out the provisions repealed by sub9 section (a) that are obligated before the effective date

10 under section 451 shall be used in the manner provided,

11 and subject to any requirements and agreements entered

12 into, under such provisions (as such provisions were in ef13 fect immediately before the repeal under subsection (a)).

14 Subtitle D—Housing and

15 Community Opportunities Agency

16 SEC. 441. ESTABLISHMENT.

17 There is hereby established as an independent estab18 lishment in the executive branch of the Government to be

19 known as the Housing and Community Opportunities

20 Agency (in this subtitle referred to as the ‘‘Agency’’).

21 SEC. 442. DIRECTOR.

22 (a) APPOINTMENT.—There shall be at the head of the

23 Housing and Community Opportunities Agency a Direc24 tor, who shall be appointed by the President, by and with

25 the advice and consent of the Senate. The Agency shall
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1 be administered under the supervision and direction of the

2 Director.

3 (b) COMPENSATION AT LEVEL IV OF EXECUTIVE

4 SCHEDULE.—Section 5315 of title 5, United States Code,

5 is amended by inserting at the end the following new item:

6 ‘‘Director, Federal Housing and Community

7 Opportunities Agency.’’.

8 SEC. 443. DUTIES.

9 The Director shall be responsible for administration

10 of the block grant programs under subtitles A, B, and C.

11 SEC. 444. PERSONNEL.

12 (a) APPOINTMENT.—The Director may select, ap13 point, employ, and fix the compensation of any officers

14 and employees necessary to carry out the functions of the

15 Director, subject to the provisions of title 5, United States

16 Code governing appointments in the competitive service,

17 and shall be paid in accordance with the provisions of

18 chapter 51 and subchapter II of chapter 53 of such title

19 relating to classification and General Schedule pay rates.

20 (b) TRANSFER.—

21 (1) IN GENERAL.—The Director may, in coordi22 nation with the Administrator of the Housing and

23 Urban Development Programs Resolution Agency,

24 transfer personnel employed by the Department of

25 Housing and Urban Development in connection with
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1 programs repealed under section 437 to fill positions

2 established by the Director, except that, the provi3 sions of section 3324 of title 5, United States Code,

4 shall apply with respect to transfers to positions in

5 grade levels above GS–15.

6 (2) EFFECT.—Any full-time or part-time per7 sonnel employed in permanent positions shall not be

8 separated or reduced in grade or compensation be9 cause of a transfer under this subsection during the

10 1-year period beginning upon the date of the enact11 ment of this Act.

12 SEC. 445. ADMINISTRATIVE PROVISIONS.

13 The Director may—

14 (1) issue any regulations the Director considers

15 necessary to carry out the functions of the Director;

16 (2) organize the Agency as the Director deter17 mines necessary or appropriate, subject to the provi18 sions of this subtitle;

19 (3) except as otherwise provided by law, dele20 gate any function of the Director to the officers and

21 employees of the Agency as the Director may des22 ignate, and may authorize successive redelegations

23 of such functions as the Director considers necessary

24 or appropriate; except that the delegation of func25 tions under this paragraph shall not relieve the Di-
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1 rector of responsibility for the administration of

2 such functions;

3 (4) procure temporary and intermittent services

4 in accordance with section 3109 of title 5, United

5 States Code;

6 (5) accept and use gifts, bequests, and dona7 tions of property;

8 (6) use the United States mails in the same

9 manner and under the same conditions as other de10 partments and agencies of the United States;

11 (7) subject to the provisions of the Federal

12 Property and Administrative Services Act of 1949,

13 make, enter into, and perform such contracts,

14 grants, leases, cooperative agreements, or other simi15 lar transactions and make such payments as the Di16 rector determines necessary or appropriate to carry

17 out the functions of the Agency; except that the au18 thority to enter into contracts and to make pay19 ments shall be effective only to such extent or in

20 such amounts as are provided in appropriation Acts;

21 and

22 (8) cause a seal of office to be made for the

23 Agency of such design as the Director shall approve,

24 and judicial notice shall be taken of the seal.
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1 SEC. 446. REPORT.

2 After the conclusion of each fiscal year, the Director

3 shall submit to the Congress a report regarding the activi4 ties of the Agency during the fiscal year. The report shall

5 include descriptions of the amounts allocated for each

6 State, for Indian tribes, and for Indian housing authorities

7 under the block grant programs under subtitles A, B, and

8 C, any actions taken by the Director under section 432,

9 and the operations and personnel needs of the Agency.

10 Subtitle E—Effective Date

11 SEC. 451. EFFECTIVE DATE.

12 (a) IN GENERAL.—Except provided in subsection (b),

13 this title shall take effect, and the amendments under this

14 title shall be made and shall apply, on the effective date

15 under section 108(a).

16 (b) PROVISIONS EFFECTIVE ON DATE OF ENACT17 MENT.—Section 442 shall take effect on the date of the

18 enactment of this Act.

19 TITLE V—SINGLE FAMILY HOUS20 ING MORTGAGE INSURANCE

21 Subtitle A—Federal Home

22 Mortgage Insurance Program

23 SEC. 501. FEDERAL HOME MORTGAGE INSURANCE FUND.

24 (a) IN GENERAL.—There is hereby established in the

25 Treasury of the United States a fund to be known as the

26 Federal Home Mortgage Insurance Fund, which shall con-
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1 sist of such amounts as may be appropriated or credited

2 to such Fund, as provided in this section. The Fund shall

3 be under the sole administration of the Administrator of

4 the Federal Home Mortgage Insurance Fund, appointed

5 under section 532.

6 (b) USE.—Amounts in the Fund shall be available

7 only for the purposes of—

8 (1) the payment to qualified mortgage insurers

9 of claims for losses under risk-sharing agreements

10 entered into under this subtitle;

11 (2) the payment of claim notes issued under

12 subsection (f)(2) of this section;

13 (3) investment as provided under subsection

14 (d); and

15 (4) annual assessments under section 1394 of

16 the Housing and Community Development Act of

17 1992 for costs of the Office of Federal Housing En18 terprise Oversight of the Department of the Treas19 ury for carrying out subtitle F of title XIII of such

20 Act.

21 (c) CREDITS.—There are hereby appropriated to the

22 Fund amounts equivalent to—

23 (1) any premium payments for mortgage insur24 ance that are paid to the Fund Administrator by

25 qualified mortgage insurers under section 505(f)(2);
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1 (2) the first $500,000,000 of proceeds from any

2 sales of FHA single family mortgage insurance in3 terests conducted under section 553; and

4 (3) any interest on, and proceeds from, the sale

5 or redemption of any obligation purchased pursuant

6 to subsection (d).

7 (d) INVESTMENT.—Amounts in the Fund not nec8 essary, in the determination of the Fund Administrator,

9 for the current operations of the Fund shall be invested

10 in interest-bearing obligations of, or interest-bearing obli11 gations guaranteed as to principal and interest by, the

12 United States or any agency of the United States.

13 (e) LIMITATION ON LIABILITY OF UNITED

14 STATES.—

15 (1) GENERAL RULE.—Any claim against the

16 Fund Administrator or the Federal Government re17 sulting from a risk-sharing agreement or insurance

18 coverage provided pursuant to this subtitle may be

19 paid only out of the Fund.

20 (2) RULE OF CONSTRUCTION.—Nothing in this

21 title may be construed to authorize the payment by

22 the United States Government of any amount with

23 respect to any such claim out of any source other

24 than the Fund.

25 (f) INSUFFICIENT AMOUNTS.—
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1 (1) PRIORITY OF CLAIMS.—If at any time the

2 amounts in the Fund are insufficient to pay all of

3 the claims on the Fund out of the Fund at such

4 time, such claims shall, to the extent permitted

5 under subsection (e)(1) be paid in full in the order

6 in which such claims are finally determined.

7 (2) CLAIM NOTE.—In the case of any claim

8 against the Fund for which amounts in the Fund

9 are insufficient to pay the claim, the Fund Adminis10 trator shall issue to the qualified mortgage insurer

11 making the claim a note in the amount of the defi12 ciency, as determined by the Fund Administrator. A

13 claim note issued under this section shall be an obli14 gation only of the Fund, shall not constitute a debt

15 or obligation backed by the full faith or credit of the

16 United States, and shall clearly indicate on the note

17 such extent and limitation of the obligation.

18 (g) ACTUARIAL STUDY.—The Fund Administrator

19 shall provide for an independent actuarial study of the

20 Fund to be conducted annually and shall report annually

21 to the Congress regarding the financial status of the

22 Fund.

23 (h) OVERSIGHT.—The Director of the Office of Fed24 eral Housing Enterprise Oversight (as reestablished under

25 section 122 of this Act) shall monitor the safety and
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1 soundness of the Fund, as provided in subtitle F of title

2 XIII of the Housing and Community Development Act of

3 1992.

4 SEC. 502. AUTHORITY TO ENTER INTO RISK-SHARING

5 AGREEMENTS FOR MORTGAGE INSURANCE

6 COVERAGE.

7 (a) IN GENERAL.—On and after the date under sub8 section (b), the Fund Administrator may enter into risk9 sharing agreements under this subtitle with qualified

10 mortgage insurers providing for the insurance of qualified

11 mortgages, in accordance with this subtitle.

12 (b) COMMENCEMENT OF BUSINESS.—The date under

13 this subsection is the first date by which both of the fol14 lowing actions have occurred:

15 (1) MINIMUM AMOUNT.—The Fund Adminis16 trator has determined that amounts in the Fund ex17 ceed $100,000,000.

18 (2) NOTICE.—The Fund Administrator certifies

19 in writing to the Congress and the President that

20 amounts in the Fund exceed $100,000,000.

21 SEC. 503. QUALIFIED MORTGAGES.

22 (a) IN GENERAL.—For purposes of this subtitle, the

23 term ‘‘qualified mortgage’’ means a mortgage on a single

24 family home to be used as the principal residence of the

25 mortgagor that meets the following requirements:
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1 (1) QUALIFIED MORTGAGEE.—The mortgage is

2 made to, and held by, a qualified mortgagee.

3 (2) UNDERWRITING.—The mortgage meets any

4 underwriting criteria established under section

5 505(c).

6 (3) ELIGIBLE MORTGAGORS AND PROP7 ERTIES.—The mortgage is executed—

8 (A) in connection with the acquisition of

9 the single family home by a mortgagor who—

10 (i) is a first-time homebuyer; and

11 (ii) has an income, at the time of in12 surance, not exceeding 125 percent of the

13 median income for the area in which the

14 property subject to the mortgage is lo15 cated;

16 (B) has an income, at the time of insur17 ance, not exceeding 80 percent of the median

18 income for the area in which the property sub19 ject to the mortgage is located;

20 (C) in connection with the acquisition of

21 the single family home—

22 (i) that is located in an area that, at

23 the time of insurance, is an economically

24 distressed area (as determined under sub25 section (c)); and
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1 (ii) by a mortgage who has an income,

2 at the time of insurance, not exceeding 125

3 percent of the median income for the area

4 in which the property subject to the mort5 gage is located; or

6 (D) for the refinancing of a mortgage pre7 viously insured under a risk-sharing agreement

8 that has an original principal obligation not ex9 ceeding 150 percent of the amount of the out10 standing principal obligation of the mortgage

11 refinanced.

12 (4) LOAN-TO-VALUE RATIO.—The mortgage in13 volves an original principal obligation in an amount

14 that does not exceed 97 percent of the appraised

15 value of the property, as of the date the mortgage

16 is accepted for insurance.

17 (b) QUALIFIED MORTGAGEES.—The Fund Adminis18 trator, in consultation with qualified mortgage insurers

19 and representatives of interested institutional mortgage

20 investors shall establish standards for mortgagees eligible

21 to make and hold mortgages insured a risk-sharing agree22 ment under this subtitle. In establishing such standards,

23 the Fund Administrator and such other entities shall take

24 into consideration mortgagee eligibility standards estab25 lished by the Secretary of Housing and Urban Develop-
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1 ment for participation in the single family housing mort2 gage insurance program under title II of the National

3 Housing Act.

4 (c) ECONOMICALLY DISTRESSED AREAS.—For pur5 poses of this subtitle, the term ‘‘economically distressed

6 area’’ means a geographical area—

7 (1) for which the decline, over the most recent

8 12 months, in the number of residents of the area

9 who are employed exceeds 2.5 percent of the total

10 number of residents of the area; and

11 (2) that—

12 (A) is located within a metropolitan statis13 tical area, as defined by the Office of Manage14 ment and Budget, and has a population of not

15 less than 40,000 or such other population as

16 the Fund Administrator considers appropriate

17 for purposes of this subtitle; or

18 (B) is located outside of a metropolitan

19 statistical area and has a population, as deter20 mined by the most recent census data available,

21 of not less than 30,000.

22 (d) INCOME AND MEDIAN AREA INCOME.—For pur23 poses of this section, incomes shall be determined in the

24 manner in which incomes are determined under title II

25 and the Fund Administrator shall utilize the same areas
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1 for which median area income is determined under such

2 title and the median area incomes so determined.

3 SEC. 504. INSURANCE COVERAGE.

4 (a) AUTHORITY.—To the extent provided in a risk5 sharing agreement under this subtitle, the qualified mort6 gage insurer under the agreement may make commitments

7 to insure, and provide mortgage insurance coverage under

8 this section for, qualified mortgages. Mortgage insurance

9 under this subtitle may be provided only for qualified

10 mortgages.

11 (b) EXTENT OF COVERAGE.—

12 (1) LIMITATION.—The portion of a mortgage

13 insured under a risk-sharing agreement under this

14 subtitle may not exceed 35 percent of the amount of

15 the outstanding principal obligation of the qualified

16 mortgage (and such fees, interest, and other ex17 penses determined by the Secretary to be appro18 priate).

19 (2) DETERMINATION.—Subject to paragraph

20 (1), the Fund Administrator may establish maxi21 mum percentage limitations of the outstanding prin22 cipal obligation of a qualified mortgage that mort23 gage insurance provided pursuant to a risk-sharing

24 agreement may cover. In establishing such limita25 tions, the Fund Administrator shall consult with
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1 mortgage insurers and other interested parties and

2 take into consideration any audits of the Comptroller

3 General under section 536(a), and the report of the

4 Comptroller General under section 536(b).

5 (3) SEPARATE LIMITATIONS.—The Fund Ad6 ministrator may determine separate maximum per7 centage limitations under paragraph (2) for various

8 categories of mortgages, based on loan-to-value ra9 tios.

10 (4) EFFECTIVE DATE.—A maximum percentage

11 limitation established under this subsection by the

12 Fund Administrator shall take effect upon the expi13 ration of the 30-day period beginning upon the

14 Fund Administrator providing written notice to the

15 Congress of the establishment of such limitation.

16 (c) MORTGAGE INSURANCE PREMIUMS.—For each

17 qualified mortgage covered by mortgage insurance pro18 vided pursuant to a risk-sharing agreement, the qualified

19 mortgage insurer shall charge and collect annual pre20 miums for the insurance during the term of the mortgage.

21 The Fund Administrator and the qualified mortgage in22 surer shall establish the amount of the premiums to be

23 paid for mortgages insured under this subtitle under a

24 risk-sharing agreement, except that the amount of such

25 premiums may not exceed, on a net present value basis,
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1 the amount of premiums charges in effect on June 1,

2 1995, for mortgage insurance under section 203 of the

3 National Housing Act.

4 (d) PAYMENT OF INSURANCE.—A claim under mort5 gage insurance provided under this section shall be paid

6 by the Fund Administrator and the qualified mortgage in7 surer to the claimant in the manner and under the condi8 tions provided for under the risk-sharing agreement.

9 (e) OBLIGATION OF FUND.—The insurance of a

10 qualified mortgage pursuant to a risk-sharing agreement

11 shall be an obligation only of the qualified mortgage in12 surer writing the insurance and the Fund and shall not

13 be a debt or obligation backed by the full faith and credit

14 of the United States.

15 SEC. 505. RISK-SHARING AGREEMENTS.

16 (a) ELIGIBLE MORTGAGE INSURERS.—The Fund Ad17 ministrator may enter into a risk-sharing agreement under

18 this subtitle only with a qualified mortgage insurer.

19 (b) SHARED-RISK MORTGAGE INSURANCE.—

20 (1) IN GENERAL.—A risk-sharing agreement

21 under this subtitle shall be a written agreement en22 tered into by the Fund Administrator and a quali23 fied mortgage insurer pursuant to which mortgage

24 insurance meeting the requirements of section 504

25 may be provided for qualified mortgages in a man-
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1 ner such that each such party to the agreement in2 sures a portion of the insurance risk under each

3 mortgage so insured (in the amounts established

4 pursuant to subsection (d)) and is severally liable for

5 the portion so insured.

6 (2) LIMITATION ON AMOUNT.—Each risk-shar7 ing agreement shall establish limitations on the ag8 gregate principal amount of the mortgages that may

9 be insured under the agreement, taking into account

10 the limitation under section 508(b).

11 (c) UNDERWRITING STANDARDS.—

12 (1) REQUIREMENT.—Each risk-sharing agree13 ment shall ensure that each mortgage insured pursu14 ant to the agreement shall meet such underwriting

15 standards as may be established under this sub16 section. Such standards shall include standards for

17 quality, type, and class of mortgages, debt-to-income

18 ratio, downpayment amount, and other loan terms

19 and conditions.

20 (2) ESTABLISHMENT.—Standards under this

21 subsection may be established—

22 (A) by regulation by the Fund Adminis23 trator, for all mortgages insured under all risk24 sharing agreements, after consultation with

25 qualified mortgage insurers and representatives
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1 of interested institutional mortgage investors;

2 and

3 (B) by terms and conditions of a risk-shar4 ing agreement (but only to the extent consistent

5 with regulations issued under subparagraph

6 (A)), for the mortgages insured under the par7 ticular risk-sharing agreement.

8 (3) AFFORDABLE HOUSING TARGETING.—Any

9 standards established under this subsection shall be

10 based primarily on any mortgage underwriting

11 standards established by the Federal National Mort12 gage Association and the Federal Home Loan Mort13 gage Corporation with respect to mortgages pur14 chased by such enterprises in furtherance of the

15 housing goals established under subpart B of part 2

16 of subtitle A of the Federal Housing Enterprises Fi17 nancial Safety and Soundness Act of 1992.

18 (4) REFINANCING REQUIREMENTS.—At a mini19 mum, the Fund Administrator shall establish stand20 ards by regulation under paragraph (2)(A) that re21 quire that, in the case of a qualified mortgage under

22 section 503(a)(3)(D), an appraisal shall be con23 ducted in connection with the execution of such refi24 nancing mortgage to determine the value of the resi25 dence for purposes of any loan-to-value limitation or
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1 other limitation established under such standards

2 that takes into consideration the value of the resi3 dence.

4 (d) TREATMENT OF LOSSES.—

5 (1) IN GENERAL.—Each risk-sharing agreement

6 shall provide that losses resulting from the defaults

7 on qualified mortgages insured pursuant to the

8 agreement shall be apportioned in accordance with

9 the standards established under this subsection.

10 (2) DETERMINATION.—The Fund Adminis11 trator shall establish standards for the apportion12 ment of losses under risk-sharing agreements to the

13 qualified mortgage insurer under the agreement and

14 the Fund. In establishing such standards, the Fund

15 Administrator shall consult with mortgage insurers

16 and other interested parties and take into consider17 ation any audits of the Comptroller General under

18 section 536(a), and the report of the Comptroller

19 General under section 536(b).

20 (3) SEPARATE LIMITATIONS.—The Fund Ad21 ministrator may establish separate standards under

22 this subsection for the apportionment of losses for

23 various categories of mortgages, based on—

24 (A) the categories under subparagraphs

25 (A), (B), (C), and (D) of section 503(a)(3); and
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1 (B) the extent of the loss.

2 (4) EFFECTIVE DATE.—A standard for the ap3 portionment of losses established under this sub4 section by the Fund Administrator shall take effect

5 upon the expiration of the 30-day period beginning

6 upon the Fund Administrator providing written no7 tice to the Congress of the establishment of such

8 standard.

9 (e) DEFINITION OF LOSSES.—For purposes of this

10 section, the term ‘‘losses’’ means the sum of any amounts

11 paid under claims for insurance coverage pursuant to risk12 sharing agreements (less any amounts recovered by the

13 mortgage insurer from disposition of insured properties

14 conveyed pursuant to payment of insurance and collection

15 on claims against mortgagors) and any costs incurred for

16 administration, maintenance, repair, taxes, and other

17 holding costs relating to insured properties.

18 (f) MORTGAGE INSURANCE PREMIUMS.—Each risk19 sharing agreement shall provide that the mortgage insurer

20 shall—

21 (1) collect, for each mortgage insured pursuant

22 to the agreement, annual premium payments in ac23 cordance with section 504(c); and

24 (2) pay to the Fund Administrator an amount

25 of the premium payments collected that is commen-
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1 surate with the apportionment of losses provided for

2 under the agreement pursuant to subsection (d), as

3 determined by the insurer and the Fund Adminis4 trator.

5 (g) ADMINISTRATIVE FEE.—Each risk-sharing

6 agreement shall provide that the qualified mortgage in7 surer may retain an amount of any premium payments

8 collected under subsection (f) to cover administrative ex9 penses involved in underwriting and administrating mort10 gage insurance coverage under this subtitle, as agreed to

11 by the Fund Administrator and the mortgage insurer. The

12 Fund Administrator may establish standards for such pro13 visions regarding retention of amounts for administrative

14 expenses.

15 (h) ALLOWANCE FOR LOSSES.—Each risk-sharing

16 agreement shall provide that any amounts owed to the

17 qualified mortgage insurer because the insurer has paid

18 claims on insurance that include losses attributable to the

19 Fund (in accordance with subsection (e)) may be recov20 ered by the insurer from premiums subsequently collected

21 by the insurer or from the Fund Administrator.

22 (i) DISPOSITION OF PROPERTIES AND COLLECTION

23 AGAINST CLAIMS.—Each risk-sharing agreement shall

24 provide that the qualified mortgage insurer shall—
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1 (1) provide for the sale, rent, or other disposi2 tion of properties conveyed to the insurer in ex3 change for payment of the benefit of insurance cov4 erage; and

5 (2) pursue to final collection all claims against

6 mortgagors assigned to the mortgage insurer by

7 mortgagees pursuant to the payment of the benefit

8 of insurance coverage.

9 (j) ADMINISTRATION OF BOOK-OF-BUSINESS

10 BASIS.—Each risk-sharing agreement shall provide that

11 any calculations regarding premiums collected, losses in12 curred, amounts to be transferred between the Fund Ad13 ministrator or the qualified mortgage insurer, and any

14 payments relating to such calculations shall be made on

15 a book-of-business basis and according to such schedules

16 as are agreed to by the Fund Administrator and the quali17 fied mortgage insurer.

18 (k) RESPONSIBILITIES OF MORTGAGE INSURER.—

19 Each risk-sharing agreement shall provide that the quali20 fied mortgage insurer providing mortgage insurance cov21 erage under the agreement shall carry out all functions

22 relating to—

23 (1) determining whether a mortgagee is a quali24 fied mortgagee;
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1 (2) determining whether a mortgage is a quali2 fied mortgage;

3 (3) making commitments for and providing

4 mortgage insurance;

5 (4) all other underwriting functions for mort6 gage insurance;

7 (5) collection of insurance premiums;

8 (6) payment to mortgagees of the benefits of in9 surance; and

10 (7) settlement of claims under mortgage insur11 ance coverage.

12 (l) ANNUAL AUDIT AND REPORT.—Each risk-sharing

13 agreement shall provide for the qualified mortgage in14 surer—

15 (1) to conduct, on an annual basis, an audit of

16 the operations of the insurer with respect to insur17 ance written pursuant to the agreement and the

18 compliance of the insurer with the requirements of

19 this subtitle and the agreement; and

20 (2) to submit to the Fund Administrator a re21 port regarding such audit.

22 SEC. 506. REQUIREMENTS FOR QUALIFIED MORTGAGE IN23 SURERS.

24 (a) IN GENERAL.—The Fund Administrator shall, by

25 regulation, establish standards to ensure that any mort-
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1 gage insurer with whom the Fund Administrator enters

2 into risk-sharing agreements under this subtitle has re3 ceived, from a nationally recognized statistical rating

4 agency, a rating on its obligations of ‘‘AA’’ or better, or

5 any equivalent designation sufficient to indicate that the

6 insurer operates financially in a safe and sound manner.

7 (b) INCLUSION AND PARTICIPATION OF STATE AND

8 LOCAL HOUSING AGENCIES.—For purposes of this sub9 title, a qualified mortgage insurer may include a State or

10 local housing finance agency or other housing agency of

11 a State or local government or a private insurer coordinat12 ing with such an agency to enter into a risk-sharing agree13 ment under this subtitle.

14 (c) RECORDS.—The Fund Administrator may re15 quire, under such standards, that a mortgage insurer

16 make available to the Fund Administrator at the Fund

17 Administrator’s request, such financial and other records

18 as the Fund Administrator considers necessary for pur19 poses of this title. The Fund Administrator may not make

20 available to the public or otherwise disclose any informa21 tion or records obtained under this subsection that is not

22 otherwise publicly available.

23 SEC. 507. DEFINITIONS.

24 For purposes of this subtitle, the following definitions

25 shall apply:
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1 (1) FIRST MORTGAGE.—The term ‘‘first mort2 gage’’ means such classes of first liens as are com3 monly given to secure advances on, or the unpaid

4 purchase price of, real estate under the laws of the

5 State in which the real estate is located, together

6 with the credit instrument, if any, secured thereby.

7 (2) FIRST-TIME HOMEBUYER.—The term ‘‘first8 time homebuyer’’ means any individual who (and

9 whose spouse) has not had any present ownership in

10 a principal residence during the 3-year period ending

11 on the date of the purchase by the individual of any

12 principal residence with a mortgage insured pursu13 ant to a risk-sharing agreement.

14 (3) FUND.—The term ‘‘Fund’’ means the Fed15 eral Home Mortgage Insurance Fund established

16 under section 501.

17 (4) MORTGAGE.—The term ‘‘mortgage’’ means

18 a first mortgage on real estate, in fee simple, or on

19 a leasehold under a lease for not less than 99 years

20 which is renewable or under a lease having a period

21 of not less than 10 years to run beyond the maturity

22 date of the mortgage. The term includes—

23 (A) a first lien given (in accordance with

24 the laws of the State where the property is lo25 cated) to secure a loan made to finance the pur-
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1 chase of stock or membership in a cooperative

2 ownership housing corporation the permanent

3 occupancy of dwelling units of which is re4 stricted to members of such corporation, where

5 the purchase of such stock or membership will

6 entitle the purchaser to the permanent occu7 pancy of one of such units;

8 (B) a first lien given (in accordance with

9 the laws of the State where the property is lo10 cated) to secure a loan made to finance the pur11 chase of a fee interest in, or long-term leasehold

12 interest in, a 1-family unit in a multifamily

13 project, including a project in which the units

14 are detached, semi-detached, or attached, and

15 an undivided interest in the common areas and

16 facilities which serve the project; and

17 (C) loans and advances of credit for the

18 purchase of financing the purchase of a manu19 factured home or the lot on which to place such

20 home and paying expenses reasonably necessary

21 for the appropriate preparation of such lot for

22 the placement of such home.

23 The term includes graduated-payment, growing-eq24 uity, adjustable rate, and shared-appreciation mort-
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1 gages, as such terms are defined by the Fund Ad2 ministrator.

3 (5) MORTGAGE INSURER.—The term ‘‘mortgage

4 insurer’’ means any person or legal entity that is au5 thorized to transact, in any State, the business of in6 surance against the nonpayment of, or default on, a

7 mortgage or loan for residential property.

8 (6) MORTGAGEE.—The term ‘‘mortgagee’’ in9 cludes the original lender under a mortgage and the

10 successors and assigns of the original lender, and in11 cludes the holders of credit instruments issued under

12 a trust mortgage or deed of trust pursuant to which

13 such holders act by and through a trustee therein

14 named.

15 (7) QUALIFIED MORTGAGE INSURER.—The

16 term ‘‘qualified mortgage insurer’’ means a mort17 gage insurer that the Fund Administrator has deter18 mined complies with the standards established under

19 section 506.

20 (8) QUALIFIED MORTGAGEE.—The term ‘‘quali21 fied mortgagee’’ means a mortgagee that complies

22 with the standards established pursuant to section

23 503(b).

24 (9) RISK-SHARING AGREEMENT.—The term

25 ‘‘risk-sharing agreement’’ means an agreement
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1 under section 505 between the Fund Administrator

2 and a qualified mortgage insurer.

3 (10) SINGLE FAMILY HOME.—The term ‘‘single

4 family home’’ means a 1- to 4-family residence.

5 (11) STATE.—The term ‘‘State’’ means the

6 States of the United States, the District of Colum7 bia, the Commonwealth of Puerto Rico, the Com8 monwealth of the Northern Mariana Islands, Guam,

9 the Virgin Islands, American Samoa, and any other

10 territory or possession of the United States.

11 SEC. 508. LIMITATION ON COMMITMENTS TO INSURE

12 MORTGAGES.

13 (a) BUDGET ACT COMPLIANCE.—The authority of

14 the Fund Administrator to enter into risk-sharing agree15 ments to insure mortgages under this subtitle shall be ef16 fective for any fiscal year only to such extent or in such

17 amounts as are or have been provided in appropriation

18 Acts for such fiscal year.

19 (b) MAXIMUM PRINCIPAL AMOUNT LIMITATION.—

20 Notwithstanding any other provision of law and subject

21 only to the authority provided in this title and the limita22 tion under subsection (a), the Fund Administrator may,

23 during the period consisting of fiscal year 1996 through

24 2000, enter into commitments under risk-sharing agree25 ments to provide mortgage insurance for mortgages hav-
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1 ing an aggregate insured principal amount of

2 $500,000,000,000.

3 Subtitle B—Federal Home Mort4 gage Insurance Fund Adminis5 tration

6 SEC. 531. ESTABLISHMENT.

7 (a) IN GENERAL.—There is hereby established an of8 fice within the Department of the Treasury, which shall

9 be known as the Federal Home Mortgage Insurance Fund

10 Administration.

11 (b) CONTINUANCE.—Notwithstanding any other pro12 vision of law or any authority of the Secretary of the

13 Treasury, the Secretary may not merge or consolidate the

14 Administration, or any functions or responsibilities of the

15 Administration, with any other function or program ad16 ministered by the Secretary.

17 SEC. 532. FUND ADMINISTRATOR.

18 (a) APPOINTMENT.—The Administration shall be

19 under the management of the Administrator of the Fed20 eral Home Mortgage Insurance Fund, who shall be ap21 pointed by the President, by and with the advice and con22 sent of the Senate, from among individuals who are citi23 zens of the United States, have a demonstrated under24 standing of the private mortgage insurance industry, the

25 secondary mortgage markets, and housing finance (includ-
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1 ing finance activities of State and local housing finance

2 agencies).

3 (b) TERM.—The Fund Administrator shall be ap4 pointed for a term of 8 years.

5 (c) VACANCY.—A vacancy in the position of Fund

6 Administrator shall be filled in the manner in which the

7 original appointment was made under subsection (a).

8 (d) SERVICE AFTER END OF TERM.—A Fund Ad9 ministrator may serve after the expiration of the term for

10 which the Fund Administrator was appointed until a suc11 cessor Fund Administrator has been appointed.

12 SEC. 533. DUTY AND AUTHORITY OF FUND ADMINIS13 TRATOR.

14 (a) DUTY.—The duties of the Fund Administrator

15 shall be—

16 (1) to administer the Federal Home Mortgage

17 Insurance Fund under section 501;

18 (2) to carry out the responsibilities under sub19 title A with respect to risk-sharing agreements;

20 (3) to exercise, pursuant to section 554, the au21 thority and functions of the Secretary of Housing

22 and Urban Development under the Single Family

23 Mortgage Foreclosure Act of 1994 and the Multi24 family Mortgage Foreclosure Act of 1981; and
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1 (4) to exercise any other authority and func2 tions of the Secretary of Housing and Urban Devel3 opment transferred under subtitle C.

4 (b) DELEGATION OF AUTHORITY.—The Fund Ad5 ministrator may delegate to officers and employees of the

6 Administration any of the functions, powers, and duties

7 of the Fund Administrator, as the Fund Administrator

8 considers appropriate.

9 SEC. 534. PERSONNEL.

10 (a) HIRING AUTHORITY.—The Fund Administrator

11 may appoint and fix the compensation of such officers and

12 employees of the Administration as the Fund Adminis13 trator considers necessary to carry out the functions of

14 the Fund Administrator and the Administration, subject

15 to the provisions of title 5, United States Code governing

16 appointments in the competitive service, and in accordance

17 with the provisions of chapter 51 and subchapter II of

18 chapter 53 of such title relating to classification and Gen19 eral Schedule pay rates.

20 (b) PERSONNEL OF OTHER FEDERAL AGENCIES.—

21 In carrying out the duties of the Administration, the Fund

22 Administrator may use information, services, staff, and fa23 cilities of any executive agency, independent agency, or de24 partment on a reimbursable basis, with the consent of

25 such agency or department.
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1 (c) REIMBURSEMENT OF TREASURY.—The Fund Ad2 ministrator shall reimburse the Department of the Treas3 ury for reasonable costs incurred by the Department that

4 are directly related to the operations of the Administra5 tion.

6 (d) OUTSIDE EXPERTS AND CONSULTANTS.—Not7 withstanding any provision of law limiting pay or com8 pensation, the Fund Administrator may appoint and com9 pensate such outside experts and consultants as the Fund

10 Administrator determines necessary to assist the work of

11 the Administration.

12 SEC. 535. REPORTS.

13 The Fund Administrator shall submit a report to the

14 Congress annually describing—

15 (1) the provisions and extent of risk-sharing

16 agreements entered into under subtitle A by the

17 Fund Administrator during the year for which the

18 report is made;

19 (2) the number, types, amounts, and character20 istics of borrowers under mortgages insured during

21 such year pursuant to such risk-sharing agreements;

22 and

23 (3) the financial condition of the Federal Home

24 Mortgage Insurance Fund at such time.
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1 SEC. 536. GAO AUDITS AND REPORTS.

2 (a) AUDITS.—The Comptroller General of the United

3 States shall audit the operations of the Administration

4 and the Federal Home Mortgage Insurance Fund in ac5 cordance with generally accepted Government auditing

6 standards. All books, records, accounts, reports, files, and

7 property belonging to, or used by, the Administration or

8 relating to the Fund shall be made available to the Comp9 troller General. Audits under this section shall be con10 ducted annually and shall specifically consider whether the

11 limitations and standards in effect governing the extent

12 of mortgage insurance coverage under risk-sharing agree13 ments under subtitle A and the apportionment of losses

14 under such risk-sharing agreements are appropriate to en15 sure that the business of the Administration is conducted

16 in a financially safe and sound manner.

17 (b) REPORT ON STANDARDS FOR INSURANCE COV18 ERAGE.—The Comptroller General shall submit a report

19 to the Fund Administrator and the Congress on appro20 priate standards and limitations for the extent of mort21 gage insurance coverage under risk-sharing agreements

22 under subtitle A and for apportionment of losses under

23 such risk-sharing agreements. The report shall be submit24 ted not later than the expiration of the 1-year period be25 ginning upon the date of the enactment of this Act.
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1 (c) REPORT ON PRIVATIZATION.—Upon the expira2 tion of the 7-year period beginning upon the date of the

3 enactment of this Act, the Comptroller General shall sub4 mit a report to the Congress regarding the effects that

5 prohibiting new business by the Federal Home Mortgage

6 Insurance Fund would have on the availability and cost

7 of mortgage credit and the prospects for privatization of

8 the functions of the Fund.

9 SEC. 537. REGULATIONS.

10 The Fund Administrator may issue any regulations

11 necessary to carry out the responsibilities of the Fund Ad12 ministrator under this title.

13 SEC. 538. AUTHORIZATION OF APPROPRIATIONS FOR AD14 MINISTRATIVE EXPENSES.

15 There is authorized to be appropriated, for expenses

16 of the Administration in carrying out this title,

17 $8,000,000 for each of fiscal years 1996, 1997, 1998,

18 1999, and 2000.

19 Subtitle C—Transition Provisions

20 SEC. 551. PROHIBITION OF NEW FHA BUSINESS.

21 (a) IN GENERAL.—Notwithstanding any provision of

22 title I, the Administrator of the Housing and Urban De23 velopment Programs Resolution Agency may not enter

24 into any commitment to insure or guarantee any mortgage

25 or loan, and may not newly insure or guarantee any mort-
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1 gage or loans, under any provision of the National Hous2 ing Act, the Indian housing loan guarantee program under

3 section 184 of the Housing and Community Development

4 Act of 1992, the multifamily housing mortgage credit

5 demonstration programs under subtitle C of title V of such

6 Act, the energy efficient mortgages pilot program under

7 section 513 of such Act (and section 106 of the Energy

8 Policy Act of 1992), except—

9 (1) as provided in subsection (b); and

10 (2) the Resolution Administrator may newly

11 guarantee or insure any mortgage under such au12 thority for which a commitment for such guarantee

13 or insurance was made before the effective date of

14 this title.

15 (b) LIMITED CONTINUANCE OF SINGLE FAMILY PRO16 GRAM.—On and before the date under section 502(b), the

17 Resolution Administrator may make commitments to in18 sure, and may newly insure, mortgages on 1- to 4-family

19 residences under the authority provided under title II of

20 the National Housing Act (and related provisions of law),

21 but only if the mortgage is executed for the acquisition

22 of such a residence by a mortgagor who is a first-time

23 homebuyer (as such term is defined in section 507) and

24 has an income, at the time of insurance, not exceeding

25 the median income for the area in which the property sub-
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1 ject to the mortgage is located, as determined by the Reso2 lution Administrator. The Resolution Administrator may

3 not newly insure any mortgage under this subsection after

4 the date under section 502(b), notwithstanding any com5 mitment to insure made on or before such date.

6 (c) AUTHORITY FOR MULTIFAMILY MARK-TO-MAR7 KET.—During the period beginning on the date of the en8 actment of this Act and ending on the date under section

9 554(b), the Resolution Administrator may take such ac10 tions as may be necessary, with respect to a multifamily

11 housing project covered in whole or in part by an expiring

12 or terminating contract for project-based rental assistance

13 under any program under section 8 or 23 (as in effect

14 before January 1, 1975) of the United States Housing Act

15 of 1937 or the rent supplement program under section

16 101 of the Housing and Urban Development Act of 1965,

17 to ensure that the project is financially viable without the

18 provision of project-based rental assistance. Notwithstand19 ing any other provision of law, or any provision of any

20 contract or agreement to which the Secretary of Housing

21 and Urban Development is a party, such actions may in22 clude making full or partial nondefault payment of claims

23 for mortgage insurance (which may include requiring a

24 recasting of the mortgage), selling defaulted mortgages,

25 removing (or agreeing to remove) mortgage, regulatory,
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1 use agreement, and other restrictions with respect to the

2 project, purchasing reinsurance, transferring economic in3 terests in insurance contracts or premiums, and other ac4 tions to ensure the ability of the project to operate in the

5 market without project-based rental assistance.

6 SEC. 552. REPEAL OF FHA INSURANCE AUTHORITY.

7 (a) REPEALS.—Effective on the date under section

8 502(b), the following provisions of law are repealed:

9 (1) NATIONAL HOUSING ACT.—Titles I, II, V,

10 VI, VII, VIII, IX, and XI of the National Housing

11 Act (12 U.S.C. 1701 et seq.).

12 (2) INDIAN HOUSING LOAN GUARANTEE PRO13 GRAM.—Section 184 of the Housing and Community

14 Development Act of 1992 (12 U.S.C. 1515z–13a).

15 (3) MULTIFAMILY HOUSING MORTGAGE CREDIT

16 DEMONSTRATION PROGRAMS.—Subtitle C of title V

17 of the Housing and Community Development Act of

18 1992 (12 U.S.C. 1707 note).

19 (4) ENERGY EFFICIENT MORTGAGES PILOT

20 PROGRAM.—Section 513 of the Housing and Com21 munity Development Act of 1992 and section 106 of

22 the Energy Policy Act of 1992 (42 U.S.C. 12712

23 note).

24 (b) SAVINGS PROVISION.—Any mortgage insurance

25 or guarantee provided under any provision of law repealed
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1 by subsection (a), or under section 551(b) of this Act, and

2 in effect on the date under section 502(b), shall continue

3 to be governed by the provisions of law applicable to the

4 mortgage insurance or guarantee as in effect immediately

5 before such date, subject to the provisions of sections 553

6 and 554 of this Act.

7 SEC. 553. SALE OF FHA ASSETS.

8 (a) IN GENERAL.—As soon as practicable, but not

9 before certification required under subsection (e)(2), the

10 Resolution Administrator shall market and sell the FHA

11 mortgage insurance interests according to the plan under

12 subsection (c).

13 (b) PURPOSES.—The Resolution Administrator shall

14 carry out the responsibilities under subsection (a) in a

15 manner that—

16 (1) maximizes the net present value return

17 from the sale of the interests and results in no net

18 cost to the Federal Government (taking into consid19 eration the cost of not selling such assets);

20 (2) minimizes the impact of such transactions

21 on the real estate and financial markets;

22 (3) protects investors in and lenders for mort23 gages insured under the FHA mortgage insurance

24 programs;
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1 (4) minimizes the risk of loss to the Federal

2 Government (including the Government National

3 Mortgage Association) resulting from non-payment

4 of insurance on defaulted mortgages insured under

5 the FHA mortgage insurance programs;

6 (5) disposes of enough such interests before

7 September 30, 1998, to result in proceeds of an

8 amount not less than the amount specified in section

9 502(b), which may include targeting the most valu10 able or marketable interests (on a book-of-business

11 basis or otherwise) for sale during such period;

12 (6) disposes of remaining interests as rapidly as

13 is practicable, taking into consideration the goals

14 under paragraphs (1) through (4); and

15 (7) disposes, to the greatest extent practicable,

16 of all disposable FHA mortgage insurance interests.

17 (c) PLAN FOR MARKETING AND SALE.—

18 (1) ESTABLISHMENT AND SUBMISSION TO CON19 GRESS.—Not later than the expiration of the 6-

20 month period beginning on the date of the enact21 ment of this Act, the Resolution Administrator shall

22 establish and submit to the Director of the Office of

23 Management and Budget and to the Congress a plan

24 for the immediate marketing and sale of FHA mort25 gage insurance interests.
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1 (2) PURPOSE.—The plan may provide for the

2 packaging, marketing, discounting, and sale of such

3 interests in any manner and to any interested pur4 chasers that the Resolution Administrator considers

5 appropriate to dispose of FHA mortgage insurance

6 interests, except that the sale shall comply with the

7 requirements of subsection (b).

8 (d) CONSULTATION.—In establishing the plan under

9 subsection (c) and carrying out this section, the Resolution

10 Administrator shall consult with the Fund Administrator

11 and appropriate persons having expertise regarding asset

12 sales conducted by the Resolution Trust Corporation, the

13 Federal Deposit Insurance Corporation, and other Federal

14 agencies, and shall utilize officers and employees of the

15 Housing and Urban Development Programs Resolution

16 Agency experienced with respect to disposition of real

17 property assets of the Department of Housing and Urban

18 Development.

19 (e) CERTIFICATION OF NO NET COST TO FEDERAL

20 GOVERNMENT.—

21 (1) DETERMINATION OF COST.—Upon receiving

22 the plan under subsection (c), the Director of the

23 Office of Management and Budget shall make a de24 termination of the cost of the plan, and of the por25 tion of the plan providing for sale of interests in ac-
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1 cordance with subsection (b)(5), to the Federal Gov2 ernment and shall certify the results of such deter3 mination to the Resolution Administrator.

4 (2) REQUIREMENT OF NO NET COST.—The

5 Resolution Administrator may not market or sell any

6 FHA mortgage insurance interests pursuant to the

7 plan unless the Director of the Office of Manage8 ment and Budget certifies to the Resolution Admin9 istrator and the Congress that such plan, or the por10 tion of the plan providing for sale of interests in ac11 cordance with subsection (b)(5), will not result in

12 any net cost to the Federal Government.

13 (3) REPORT.—If the Director certifies that the

14 plan or a portion of the plan will result in a net cost

15 to the Federal Government, the Resolution Adminis16 trator shall submit a report to the Congress describ17 ing the reasons for such cost and any appropriate

18 revisions to the plan or portion or to the require19 ments under this section.

20 (f) TREATMENT OF PROCEEDS.—Proceeds from the

21 sale of FHA mortgage insurance interests shall be used

22 as follows:

23 (1) START-UP AMOUNTS FOR FEDERAL HOME

24 MORTGAGE INSURANCE FUND.—The first

25 $500,000,000 of such proceeds shall be credited to
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1 the Federal Home Mortgage Insurance Fund in ac2 cordance with section 501(c).

3 (2) DEFICIT REDUCTION.—Any such proceeds

4 exceeding the amount under paragraph (1) shall be

5 covered into the General Fund of the Treasury of

6 the United States.

7 (g) REPEAL OF LIMITATIONS ON DISPOSITION OF

8 HUD-OWNED MULTIFAMILY PROJECTS.—Section 203 of

9 the Housing and Community Development Amendments

10 of 1978 (12 U.S.C. 1701z–11) is hereby repealed.

11 SEC. 554. TRANSFER OF REMAINING FHA AUTHORITY TO

12 ADMINISTRATOR OF FEDERAL HOME MORT13 GAGE INSURANCE FUND.

14 (a) IN GENERAL.—Effective on the date under sub15 section (b), there shall be transferred to the Fund Admin16 istrator—

17 (1) to the extent that any such functions or

18 amounts exist on such date, all functions of the Res19 olution Administrator regarding administration of

20 any insurance or guarantees provided, and funds es21 tablished, under the provisions of law repealed by

22 section 552(a) or under section 551(b);

23 (2) all functions of the Resolution Adminis24 trator under section 553 of this Act; and
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1 (3) all functions of the Resolution Adminis2 trator under the Single Family Mortgage Fore3 closure Act of 1994 (12 U.S.C. 3751 et seq.) and

4 the Multifamily Mortgage Foreclosure Act of 1981

5 (12 U.S.C. 3701 et seq.).

6 (b) TIMING.—The date under this subsection is the

7 earlier of—

8 (1) October 1, 2000; or

9 (2) the date specified by the Fund Adminis10 trator in a notice submitted to the Congress and the

11 Secretary of Housing and Urban Development cer12 tifying that the Fund Administrator has the admin13 istrative capacity to carry out the functions trans14 ferred by this section.

15 SEC. 555. DEFINITIONS.

16 For purposes of this subtitle, the following definitions

17 shall apply:

18 (1) DISPOSABLE.—The term ‘‘disposable’’

19 means, with respect to FHA mortgage insurance in20 terests, such an interest—

21 (A) for which the underlying mortgage—

22 (i) has been purchased by the Govern23 ment National Mortgage Association or is

24 included in any trust or pool of mortgages

25 for which trust certificates or other securi-
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1 ties have been issued which are guaranteed

2 by such Association; or

3 (ii) is owned or held by the Resolution

4 Administrator; or

5 (B) that is a property that is owned by the

6 Resolution Administrator.

7 (2) FHA MORTGAGE INSURANCE INTERESTS.—

8 The term ‘‘FHA mortgage insurance interests’’

9 means assets, interests, debts, and obligations of the

10 Resolution Administrator attributable to residential

11 mortgage insurance provided by the Resolution Ad12 ministrator or the Secretary of Housing and Urban

13 Development under any provision of title II of the

14 National Housing Act. The term includes any rights

15 and obligations of the Resolution Administrator or

16 such Secretary under mortgage insurance contracts

17 (including rights to payment of mortgage insurance

18 premiums), amounts in the mortgage insurance

19 funds under title II of the National Housing Act and

20 investments of such funds that are attributable to

21 such premiums collected, and properties and mort22 gages held by such Administrator or Secretary.

23 (3) FHA MULTIFAMILY MORTGAGE INSURANCE

24 INTERESTS.—The term ‘‘FHA multifamily mortgage

25 insurance interests’’ means FHA mortgage insur-
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1 ance interests attributable to mortgage insurance

2 provided for a mortgage on a residence consisting of

3 5 or more dwelling units.

4 (4) FHA SINGLE FAMILY MORTGAGE INSUR5 ANCE INTERESTS.—The term ‘‘FHA single family

6 mortgage insurance interests’’ means FHA mort7 gage insurance interests attributable to mortgage in8 surance for a mortgage on 1- to 4-family residences.

9 (5) RESOLUTION ADMINISTRATOR.—The term

10 ‘‘Resolution Administrator’’ means the Adminis11 trator of the Housing and Urban Development Pro12 grams Resolution Agency.

13 Subtitle D—General and

14 Miscellaneous Provisions

15 SEC. 571. AMENDMENTS TO TITLE 5, UNITED STATES CODE.

16 (a) COMPENSATION OF FUND ADMINISTRATOR AT

17 LEVEL IV OF EXECUTIVE SCHEDULE.—Section 5315 of

18 title 5, United States Code, is amended by inserting at

19 the end the following new item:

20 ‘‘Administrator of the Federal Home Mortgage

21 Insurance Fund.’’.
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1 SEC. 572. AUTHORITY OF DIRECTOR OF OFHEO TO MON2 ITOR SAFETY AND SOUNDNESS OF FUND.

3 (a) IN GENERAL.—Title XIII of the Housing and

4 Community Development Act of 1992 (Public Law 102–

5 550; 106 Stat. 4009) is amended—

6 (1) by redesignating sections 1391 through

7 1395 as sections 1385 through 1389, respectively;

8 and

9 (2) by adding at the end the following new sub10 title:

11 ‘‘Subtitle F—Supervision and Regu12 lation of Federal Home Mort13 gage Insurance Fund

14 ‘‘SEC. 1391. AUTHORITY OF DIRECTOR.

15 ‘‘The Director of the Office of Federal Housing En16 terprise Oversight shall monitor and regulate the safety

17 and soundness of the Federal Home Mortgage Insurance

18 Fund established under section 501 of the Housing Op19 portunities and Empowerment Act (in this subtitle re20 ferred to as the ‘Fund’).

21 ‘‘SEC. 1392. EXAMINATIONS, REPORTS, AND COST ESTI22 MATES.

23 ‘‘(a) EXAMINATIONS.—The Director shall conduct

24 such examinations of the Fund as the Director determines

25 necessary to evaluate the safety and soundness of the
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1 Fund. Such examinations shall be subject to and governed

2 by subsections (c) through (f) of section 1317.

3 ‘‘(b) REPORTS.—The Director may require the Ad4 ministrator of the Federal Home Mortgage Insurance

5 Fund of the Department of the Treasury to submit, within

6 a reasonable period of time, any regular or special report,

7 data, or other information whenever, in the judgment of

8 the Director, such report, data, or information is nec9 essary to carry out the Director’s responsibilities under

10 this subtitle.

11 ‘‘(c) ANNUAL REPORT ON SAFETY AND SOUND12 NESS.—The Director shall submit an annual report to the

13 Congress and the Director of the Office of Management

14 and Budget on the Fund’s financial safety and soundness,

15 as measured pursuant to this subtitle.

16 ‘‘SEC. 1393. CAPITAL REQUIREMENTS.

17 ‘‘The Director may establish and adjust capital ratio

18 requirements for the Fund based on consideration of such

19 factors as the Director considers appropriate.

20 ‘‘SEC. 1394. REIMBURSEMENT OF COSTS.

21 ‘‘(a) ASSESSMENT AND COLLECTION.—The Director

22 shall assess and collect from the Fund such amounts de23 termined by the Director as necessary to reimburse the

24 Office of Federal Housing Enterprise Oversight for the

25 reasonable costs and expenses of the activities undertaken
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1 by such Office to carry out the duties of the Director

2 under this subtitle, including the costs of examination, en3 forcement, and oversight expenses.

4 ‘‘(b) REQUIREMENTS.—Annual assessments imposed

5 by the Director shall be—

6 ‘‘(1) imposed prior to October 1 of each year;

7 ‘‘(2) collected at such time or times during each

8 assessment year as determined necessary or appro9 priate by the Director;

10 ‘‘(3) deposited into the Federal Housing Enter11 prise Fund established by section 1316(f); and

12 ‘‘(4) available, to the extent provided in appro13 priation Acts, for carrying out the responsibilities of

14 the Director under this subtitle.’’.

15 (b) CLERICAL AMENDMENT.—The table of contents

16 in section 1(b) of the Housing and Community Develop17 ment Act of 1992 (Public Law 102–550; 106 Stat. 3679)

18 is amended—

19 (1) by redesignating the items relating to sec20 tions 1391 through 1395 as relating to sections

21 1385 through 1389, respectively; and

22 (2) by inserting before the item relating to title

23 XIV the following new items:

‘‘Subtitle F—Supervision and Regulation of Federal Home Mortgage

Insurance Fund

‘‘Sec. 1391. Authority of Director.

‘‘Sec. 1392. Examinations, reports, and cost estimates.
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‘‘Sec. 1393. Capital requirements.

‘‘Sec. 1394. Reimbursement of costs.’’.

1 SEC. 573. DEFINITIONS.

2 For purposes of this title, the following definitions

3 shall apply:

4 (1) ADMINISTRATION.—The term ‘‘Administra5 tion’’ means the Federal Home Mortgage Insurance

6 Fund Administration, established under section 531.

7 (2) FUND ADMINISTRATOR.—The term ‘‘Fund

8 Administrator’’ means the Administrator of the Fed9 eral Home Mortgage Insurance Fund.

10 (3) SECRETARY.—Except as specifically pro11 vided otherwise, the term ‘‘Secretary’’ means the

12 Secretary of the Treasury.

13 SEC. 574. EFFECTIVE DATE.

14 (a) IN GENERAL.—Except as provided in subsection

15 (b) or otherwise specifically provided in this title, this title

16 shall take effect, and the amendments under this title shall

17 be made and shall apply, on the effective date under sec18 tion 108(a).

19 (b) PROVISIONS EFFECTIVE ON DATE OF ENACT20 MENT.—The following provisions of this title shall take ef21 fect on the date of the enactment of this Act:

22 (1) Section 532(a).

23 (2) Section 536(b).

24 (3) Subsections (c) and (d) of section 553.
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1 TITLE VI—OFFICE OF FEDERAL2 ISM IN OFFICE OF MANAGE3 MENT AND BUDGET

4 SEC. 601. ESTABLISHMENT.

5 There is hereby established in the Office of Manage6 ment and Budget an office to be known as the Office of

7 Federalism (in this title referred to as the ‘‘Office’’).

8 SEC. 602. ADMINISTRATOR.

9 (a) APPOINTMENT.—There shall be at the head of the

10 Office an Administrator who shall be appointed by the

11 President, by and with the advice and consent of the Sen12 ate. This subsection shall take effect on the date of the

13 enactment of this Act.

14 (b) DELEGATION.—The Director of the Office of

15 Management and Budget shall delegate to the Adminis16 trator the authority to administer all functions under this

17 title, except that any such delegation shall not relieve the

18 Director of responsibility for the administration of such

19 functions.

20 SEC. 603. FUNCTIONS OF ADMINISTRATOR.

21 (a) PURPOSE.—The Administrator shall serve as

22 principal policy adviser to the Director on issues of fed23 eralism and shall provide overall direction of policy and

24 leadership in the development of communications and rela-
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1 tions between the executive agencies of the Federal gov2 ernment and State and local governments.

3 (b) FUNCTIONS.—The functions of the Administrator

4 shall include—

5 (1) reviewing and evaluating policies, legisla6 tion, and regulations to determine their effect on the

7 relationship and allocation of authority between the

8 Federal Government and State governments and

9 providing advice to the President and executive

10 agencies regarding such matters; and

11 (2) serving as a liaison for the Federal Govern12 ment to Governors, mayors, and other elected State

13 and local officials, and otherwise communicating

14 with States, with regard to matters involving fed15 eralism issues, including Federal block grant initia16 tives.

17 SEC. 604. AUTHORIZATION OF APPROPRIATIONS.

18 There is authorized to be appropriated to carry out

19 this title such sums as may be necessary for each of fiscal

20 years 1996, 1997, 1998, 1999, and 2000.

21 SEC. 605. COMPENSATION OF ADMINISTRATOR AT LEVEL

22 III OF EXECUTIVE SCHEDULE.

23 Section 5314 of title 5, United States Code, is

24 amended by inserting, after the item relating to the Ad25 ministrator of the Office of Information and Regulatory
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1 Affairs of the Office of Management and Budget, the fol2 lowing new item:

3 ‘‘Administrator, Office of Federalism, Office of

4 Management and Budget.’’.

5 SEC. 606. EFFECTIVE DATE.

6 Except as otherwise provided in this title, this title

7 shall take effect, and the amendments under this title shall

8 be made and shall apply, on the effective date under sec9 tion 108(a).

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