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[111th Congress Public Law 372]
[From the U.S. Government Printing Office]

[[Page 124 STAT. 4077]]

Public Law 111-372
111th Congress

                                 An Act

 
To amend section 202 of the Housing Act of 1959, to improve the program 
under such section for supportive housing for the elderly, and for other 
              purposes. <<NOTE: Jan. 4, 2011 -  [S. 118]>> 

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled, <<NOTE: Section 202 
Supportive Housing for the Elderly Act of 2010.>> 
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) <<NOTE: 12 USC 1701 note.>>  Short Title.--This Act may be cited 
as the ``Section 202 Supportive Housing for the Elderly Act of 2010''.

    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title and table of contents.

                    TITLE I--NEW CONSTRUCTION REFORMS

Sec. 101. Selection criteria.
Sec. 102. Development cost limitations.
Sec. 103. Owner deposits.
Sec. 104. Definition of private nonprofit organization.
Sec. 105. Nonmetropolitan allocation.

                          TITLE II--REFINANCING

Sec. 201. Approval of prepayment of debt.
Sec. 202. Use of unexpended amounts.
Sec. 203. Use of project residual receipts.
Sec. 204. Additional provisions.

   TITLE III--ASSISTED LIVING FACILITIES AND SERVICE-ENRICHED HOUSING

Sec. 301. Amendments to the grants for conversion of elderly housing to 
           assisted living facilities.
Sec. 302. Monthly assistance payment under rental assistance.

      TITLE IV--COMPLIANCE WITH STATUTORY PAY-AS-YOU-GO ACT OF 2010

Sec. 401. Budgetary effects.

                    TITLE I--NEW CONSTRUCTION REFORMS

SEC. 101. SELECTION CRITERIA.

    Section 202(f)(1) of the Housing Act of 1959 (12 U.S.C. 1701q(f)(1)) 
is amended--
            (1) by redesignating subparagraphs (F) and (G) as 
        subparagraphs (G) and (H), respectively; and
            (2) by inserting after subparagraph (E) the following new 
        subparagraph:
            ``(F) the extent to which the applicant has ensured that a 
        service coordinator will be employed or otherwise retained

[[Page 124 STAT. 4078]]

        for the housing, who has the managerial capacity and 
        responsibility for carrying out the actions described in 
        subparagraphs (A) and (B) of subsection (g)(2);''.
SEC. 102. DEVELOPMENT COST LIMITATIONS.

    Section 202(h)(1) of the Housing Act of 1959 (12 U.S.C. 1701q(h)(1)) 
is amended, in the matter preceding subparagraph (A), by inserting 
``reasonable'' before ``development cost limitations''.
SEC. 103. OWNER DEPOSITS.

    Section 202(j)(3)(A) of the Housing Act of 1959 (12 U.S.C. 
1701q(j)(3)(A)) is amended by inserting after the period at the end the 
following: ``Such amount shall be used only to cover operating deficits 
during the first 3 years of operations and shall not be used to cover 
construction shortfalls or inadequate initial project rental assistance 
amounts.''.
SEC. 104. DEFINITION OF PRIVATE NONPROFIT ORGANIZATION.

    Section 202(k)(4) of the Housing Act of 1959 (12 U.S.C. 1701q(k)(4)) 
is amended to read as follows:
            ``(4) The term `private nonprofit organization' means--
                    ``(A) any incorporated private institution or 
                foundation--
                          ``(i) no part of the net earnings of which 
                      inures to the benefit of any member, founder, 
                      contributor, or individual;
                          ``(ii) which has a governing board--
                                    ``(I) the membership of which is 
                                selected in a manner to assure that 
                                there is significant representation of 
                                the views of the community in which such 
                                housing is located; and
                                    ``(II) which is responsible for the 
                                operation of the housing assisted under 
                                this section, except that, in the case 
                                of a nonprofit organization that is the 
                                sponsoring organization of multiple 
                                housing projects assisted under this 
                                section, the Secretary may determine the 
                                criteria or conditions under which 
                                financial, compliance and other 
                                administrative responsibilities 
                                exercised by a single-entity private 
                                nonprofit organization that is the owner 
                                corporation responsible for the 
                                operation of an individual housing 
                                project may be shared or transferred to 
                                the governing board of such sponsoring 
                                organization; and
                          ``(iii) which is approved by the Secretary as 
                      to financial responsibility; and
                    ``(B) a for-profit limited partnership the sole 
                general partner of which is--
                          ``(i) an organization meeting the requirements 
                      under subparagraph (A);
                          ``(ii) a for-profit corporation wholly owned 
                      and controlled by one or more organizations 
                      meeting the requirements under subparagraph (A); 
                      or
                          ``(iii) a limited liability company wholly 
                      owned and controlled by one or more organizations 
                      meeting the requirements under subparagraph 
                      (A).''.

[[Page 124 STAT. 4079]]

SEC. 105. NONMETROPOLITAN ALLOCATION.

    Paragraph (3) of section 202(l) of the Housing Act of 1959 (12 
U.S.C. 1701q(l)(3)) is amended by inserting after the period at the end 
the following: ``In complying with this paragraph, the Secretary shall 
either operate a national competition for the nonmetropolitan funds or 
make allocations to regional offices of the Department of Housing and 
Urban Development.''.

                          TITLE II--REFINANCING

SEC. 201. APPROVAL OF PREPAYMENT OF DEBT.

    Subsection (a) of section 811 of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
            (1) in the matter preceding paragraph (1), by inserting ``, 
        for which the Secretary's consent to prepayment is required,'' 
        after ``Affordable Housing Act)'';
            (2) in paragraph (1)--
                    (A) by inserting ``at least 20 years following'' 
                before ``the maturity date'';
                    (B) by inserting ``project-based'' before ``rental 
                assistance payments contract'';
                    (C) by inserting ``project-based'' before ``rental 
                housing assistance programs''; and
                    (D) by inserting ``, or any successor project-based 
                rental assistance program,'' after ``1701s))'';
            (3) by amending paragraph (2) to read as follows:
            ``(2) the prepayment may involve refinancing of the loan if 
        such refinancing results in--
                    ``(A) a lower interest rate on the principal of the 
                loan for the project and in reductions in debt service 
                related to such loan; or
                    ``(B) a transaction in which the project owner will 
                address the physical needs of the project, but only if, 
                as a result of the refinancing--
                          ``(i) the rent charges for unassisted families 
                      residing in the project do not increase or such 
                      families are provided rental assistance under a 
                      senior preservation rental assistance contract for 
                      the project pursuant to subsection (e); and
                          ``(ii) the overall cost for providing rental 
                      assistance under section 8 for the project (if 
                      any) is not increased, except, upon approval by 
                      the Secretary to--
                                    ``(I) mark-up-to-market contracts 
                                pursuant to section 524(a)(3) of the 
                                Multifamily Assisted Housing Reform and 
                                Affordability Act (42 U.S.C. 1437f 
                                note), as such section is carried out by 
                                the Secretary for properties owned by 
                                nonprofit organizations; or
                                    ``(II) mark-up-to-budget contracts 
                                pursuant to section 524(a)(4) of the 
                                Multifamily Assisted Housing Reform and 
                                Affordability Act (42 U.S.C. 1437f 
                                note), as such section is carried out by 
                                the Secretary for properties owned by 
                                eligible owners (as such term is defined 
                                in section 202(k) of the

[[Page 124 STAT. 4080]]

                                Housing Act of 1959 (12 U.S.C. 
                                1701q(k)); and''; and
            (4) by adding at the end the following:
            ``(3) notwithstanding paragraph (2)(A), the prepayment and 
        refinancing authorized pursuant to paragraph (2)(B) involves an 
        increase in debt service only in the case of a refinancing of a 
        project assisted with a loan under such section 202 carrying an 
        interest rate of 6 percent or lower.''.
SEC. 202. USE OF UNEXPENDED AMOUNTS.

    Subsection (c) of section 811 of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
            (1) by striking ``Use of Unexpended Amounts.--'' and 
        inserting ``Use of Proceeds.--'';
            (2) by amending the matter preceding paragraph (1) to read 
        as follows: ``Upon execution of the refinancing for a project 
        pursuant to this section, the Secretary shall ensure that 
        proceeds are used in a manner advantageous to tenants of the 
        project, or are used in the provision of affordable rental 
        housing and related social services for elderly persons that are 
        tenants of the project or are tenants of other HUD-assisted 
        senior housing by the private nonprofit organization project 
        owner, private nonprofit organization project sponsor, or 
        private nonprofit organization project developer, including--'';
            (3) by amending paragraph (1) to read as follows:
            ``(1) not more than 15 percent of the cost of increasing the 
        availability or provision of supportive services, which may 
        include the financing of service coordinators and congregate 
        services, except that upon the request of the non-profit owner, 
        sponsor, or organization and determination of the Secretary, 
        such 15 percent limitation may be waived to ensure that the use 
        of unexpended amounts better enables seniors to age in place;'';
            (4) in paragraph (2), by inserting before the semicolon the 
        following; ``, including reducing the number of units by 
        reconfiguring units that are functionally obsolete, 
        unmarketable, or not economically viable'';
            (5) in paragraph (3), by striking ``or'' at the end;
            (6) in paragraph (4), by striking ``according to a pro rata 
        allocation of shared savings resulting from the refinancing.'' 
        and inserting a semicolon; and
            (7) by adding at the end the following new paragraphs:
            ``(5) rehabilitation of the project to ensure long-term 
        viability; and
            ``(6) the payment to the project owner, sponsor, or third 
        party developer of a developer's fee in an amount not to exceed 
        or duplicate--
                    ``(A) in the case of a project refinanced through a 
                State low income housing tax credit program, the fee 
                permitted by the low income housing tax credit program 
                as calculated by the State program as a percentage of 
                acceptable development cost as defined by that State 
                program; or
                    ``(B) in the case of a project refinanced through 
                any other source of refinancing, 15 percent of the 
                acceptable development cost.

[[Page 124 STAT. 4081]]

For purposes of paragraph (6)(B), the term `acceptable development cost' 
shall include, as applicable, the cost of acquisition, rehabilitation, 
loan prepayment, initial reserve deposits, and transaction costs.''.
SEC. 203. USE OF PROJECT RESIDUAL RECEIPTS.

    Paragraph (1) of section 811(d) of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
            (1) by striking ``not more than 15 percent of''; and
            (2) by inserting before the period at the end the following: 
        ``or other purposes approved by the Secretary''.
SEC. 204. ADDITIONAL PROVISIONS.

    Section 811 of the American Homeownership and Economic Opportunity 
Act of 2000 (12 U.S.C. 1701q note) is amended by adding at the end the 
following new subsections:
    ``(e) Senior Preservation Rental Assistance Contracts.--
Notwithstanding any other provision of law, in connection with a 
prepayment plan for a project approved under subsection (a) by the 
Secretary or as otherwise approved by the Secretary to prevent 
displacement of elderly residents of the project in the case of 
refinancing or recapitalization and to further preservation and 
affordability of such project, the Secretary shall provide project-based 
rental assistance for the project under a senior preservation rental 
assistance contract, as follows:
            ``(1) Assistance under the contract shall be made available 
        to the private nonprofit organization owner--
                    ``(A) for a term of at least 20 years, subject to 
                annual appropriations; and
                    ``(B) under the same rules governing project-based 
                rental assistance made available under section 8 of the 
                Housing Act of 1937 or under the rules of such 
                assistance as may be made available for the project.
            ``(2) Any projects for which a senior preservation rental 
        assistance contract is provided shall be subject to a use 
        agreement to ensure continued project affordability having a 
        term of the longer of (A) the term of the senior preservation 
        rental assistance contract, or (B) such term as is required by 
        the new financing.

    ``(f) Subordination or Assumption of Existing Debt.--In lieu of 
prepayment under this section of the indebtedness with respect to a 
project, the Secretary may approve--
            ``(1) in connection with new financing for the project, the 
        subordination of the loan for the project under section 202 of 
        the Housing Act of 1959 (as in effect before the enactment of 
        the Cranston-Gonzalez National Affordable Housing Act) and the 
        continued subordination of any other existing subordinate debt 
        previously approved by the Secretary to facilitate preservation 
        of the project as affordable housing; or
            ``(2) the assumption (which may include the subordination 
        described in paragraph (1)) of the loan for the project under 
        such section 202 in connection with the transfer of the project 
        with such a loan to a private nonprofit organization.

    ``(g) Flexible Subsidy Debt. <<NOTE: Waiver authority.>> --The 
Secretary shall waive the requirement that debt for a project pursuant 
to the flexible subsidy program under section 201 of the Housing and 
Community Development Amendments of 1978 (12 U.S.C. 1715z-1a) be prepaid 
in

[[Page 124 STAT. 4082]]

connection with a prepayment, refinancing, or transfer under this 
section of a project if the financial transaction or refinancing cannot 
be completed without the waiver.

    ``(h) Tenant Involvement in Prepayment and Refinancing.--The 
Secretary shall not accept an offer to prepay the loan for any project 
under section 202 of the Housing Act of 1959 unless the Secretary--
            ``(1) has determined that the owner of the project has 
        notified the tenants of the owner's request for approval of a 
        prepayment; and
            ``(2) has determined that the owner of the project has 
        provided the tenants with an opportunity to comment on the 
        owner's request for approval of a prepayment, including on the 
        description of any anticipated rehabilitation or other use of 
        the proceeds from the transaction, and its impacts on project 
        rents, tenant contributions, or the affordability restrictions 
        for the project, and that the owner has responded to such 
        comments in writing.

    ``(i) Definition of Private Nonprofit Organization.--For purposes of 
this section, the term `private nonprofit organization' has the meaning 
given such term in section 202(k) of the Housing Act of 1959 (12 U.S.C. 
1701q(k)).''.

   TITLE III--ASSISTED LIVING FACILITIES AND SERVICE-ENRICHED HOUSING

SEC. 301. AMENDMENTS TO THE GRANTS FOR CONVERSION OF ELDERLY 
                        HOUSING TO ASSISTED LIVING FACILITIES.

    (a) Technical Amendment.--The section heading for section 202b of 
the Housing Act of 1959 (12 U.S.C. 1701q-2) is amended by inserting 
``and other purposes'' after ``assisted living facilities''.
    (b) Extension of Grant Authority.--Section 202b(a)(2) of the Housing 
Act of 1959 (12 U.S.C. 1701q-2(a)(2)) is amended--
            (1) by striking ``(2) Conversion.--Activities'' and 
        inserting the following:
            ``(2) Conversion.--
                    ``(A) Assisted living facilities.--Activities''; and
            (2) by adding at the end the following:
                    ``(B) Service-enriched housing.--Activities designed 
                to convert dwelling units in the eligible project to 
                service-enriched housing for elderly persons.''.

    (c) Amendment to Application Process.--Section 202b(c)(1) of the 
Housing Act of 1959 (12 U.S.C. 1701q-2(c)(1)) is amended by inserting 
``for either an assisted living facility or service-enriched housing'' 
after ``activities''.
    (d) Requirements for Services.--Section 202b(d) of the Housing Act 
of 1959 (12 U.S.C. 1701q-2(d)) is amended to read as follows:
    ``(d) Requirements for Services.--
            ``(1) Sufficient evidence of firm funding commitments.--The 
        Secretary may not make a grant under this section for conversion 
        activities unless an application for a grant submitted pursuant 
        to subsection (c) contains sufficient evidence, in the 
        determination of the Secretary, of firm commitments for the 
        funding of services to be provided in the assisted

[[Page 124 STAT. 4083]]

        living facility or service-enriched housing, which may be 
        provided by third parties.
            ``(2) Required evidence.--The Secretary shall require 
        evidence that each recipient of a grant for service-enriched 
        housing under this section provides relevant and timely 
        disclosure of information to residents or potential residents of 
        such housing relating to--
                    ``(A) the services that will be available at the 
                property to each resident, including--
                          ``(i) the right to accept, decline, or choose 
                      such services and to have the choice of provider;
                          ``(ii) the services made available by or 
                      contracted through the grantee;
                          ``(iii) the identity of, and relevant 
                      information for, all agencies or organizations 
                      providing any services to residents, which 
                      agencies or organizations shall provide 
                      information regarding all procedures and 
                      requirements to obtain services, any charges or 
                      rates for the services, and the rights and 
                      responsibilities of the residents related to those 
                      services;
                    ``(B) the availability, identity, contact 
                information, and role of the service coordinator; and
                    ``(C) such other information as the Secretary 
                determines to be appropriate to ensure that residents 
                are adequately informed of the services options 
                available to promote resident independence and quality 
                of life.''.

    (e) Amendments to Selection Criteria.--Section 202b(e) of the 
Housing Act of 1959 (12 U.S.C. 1701q-2(e)) is amended--
            (1) in paragraph (2)--
                    (A) by inserting ``or service-enriched housing'' 
                after ``facilities''; and
                    (B) by inserting ``service-enriched housing'' after 
                ``facility'';
            (2) in paragraph (5), by inserting ``or service-enriched 
        housing'' after ``facility''; and
            (3) in paragraph (6), by inserting ``or service-enriched 
        housing'' after ``facility''.

    (f) Amendments to Section 8 Project-based Assistance.--Section 
202b(f) of the Housing Act of 1959 (12 U.S.C. 1701q-2(f)) is amended--
            (1) in paragraph (1), by inserting ``or service-enriched 
        housing'' after ``facilities'' each time that term appears; and
            (2) in paragraph (2), by inserting ``or service-enriched 
        housing'' after ``facility''.

    (g) Amendments to Definitions.--Section 202b(g) of the Housing Act 
of 1959 (12 U.S.C. 1701q-2(g)) is amended to read as follows:
    ``(g) Definitions.--For purposes of this section--
            ``(1) the term `assisted living facility' has the meaning 
        given such term in section 232(b) of the National Housing Act 
        (1715w(b));
            ``(2) the term `service-enriched housing' means housing 
        that--
                    ``(A) makes available through licensed or certified 
                third party service providers supportive services to 
                assist the residents in carrying out activities of daily 
                living, such as bathing, dressing, eating, getting in 
                and out of bed

[[Page 124 STAT. 4084]]

                or chairs, walking, going outdoors, using the toilet, 
                laundry, home management, preparing meals, shopping for 
                personal items, obtaining and taking medication, 
                managing money, using the telephone, or performing light 
                or heavy housework, and which may make available to 
                residents home health care services, such as nursing and 
                therapy;
                    ``(B) includes the position of service coordinator, 
                which may be funded as an operating expense of the 
                property;
                    ``(C) provides separate dwelling units for 
                residents, each of which contains a full kitchen and 
                bathroom and which includes common rooms and other 
                facilities appropriate for the provision of supportive 
                services to the residents of the housing; and
                    ``(D) provides residents with control over health 
                care and supportive services decisions, including the 
                right to accept, decline, or choose such services, and 
                to have the choice of provider; and
            ``(3) <<NOTE: Applicability.>>  the definitions in section 
        1701(q)(k) of this title shall apply.''.
SEC. 302. MONTHLY ASSISTANCE PAYMENT UNDER RENTAL ASSISTANCE.

    Clause (iii) of section 8(o)(18)(B) of the United States Housing Act 
of 1937 (42 U.S.C. 1437f(o)(18)(B)(iii)) is amended by inserting before 
the period at the end the following: ``, except that a family may be 
required at the time the family initially receives such assistance to 
pay rent in an amount exceeding 40 percent of the monthly adjusted 
income of the family by such an amount or percentage that is reasonable 
given the services and amenities provided and as the Secretary deems 
appropriate.''.

      TITLE IV--COMPLIANCE WITH STATUTORY PAY-AS-YOU-GO ACT OF 2010

SEC. 401. BUDGETARY EFFECTS.

    The budgetary effects of this Act, for the purpose of complying with 
the Statutory Pay-As-You-Go-Act of 2010, shall be determined by 
reference to the latest statement titled ``Budgetary Effects of PAYGO 
Legislation'' for this Act, submitted for printing in the

[[Page 124 STAT. 4085]]

Congressional Record by the Chairman of the Senate Budget Committee, 
provided that such statement has been submitted prior to the vote on 
passage.

    Approved January 4, 2011.

LEGISLATIVE HISTORY--S. 118:
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CONGRESSIONAL RECORD, Vol. 156 (2010):
            Dec. 18, considered and passed Senate.
            Dec. 21, considered and passed House.

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