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[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 2997 Introduced in Senate (IS)]

106th CONGRESS
  2d Session
                                S. 2997

   To establish a National Housing Trust Fund in the Treasury of the 
   United States to provide for the development of decent, safe, and 
              affordable housing for low-income families.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             July 27, 2000

  Mr. Kerry (for himself, Mr. Jeffords, Mr. Sarbanes, Mr. Leahy, Mr. 
   Bryan, Mr. Reed, Mr. L. Chafee, and Mr. Wellstone) introduced the 
 following bill; which was read twice and referred to the Committee on 
                   Banking, Housing and Urban Affairs

_______________________________________________________________________

                                 A BILL

 
   To establish a National Housing Trust Fund in the Treasury of the 
   United States to provide for the development of decent, safe, and 
              affordable housing for low-income families.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Affordable Housing Trust 
Fund Act of 2000''.

SEC. 2. PURPOSES.

    The purposes of this Act are to--
            (1) fill the growing gap in the national ability to build 
        affordable housing by using profits generated by Federal 
        housing programs to fund additional housing activities, and not 
        supplant existing housing appropriations; and
            (2) enable rental housing to be built for those families 
        with the greatest need in areas with the greatest opportunities 
        in mixed-income settings and to promote homeownership for low-
        income families.

SEC. 3. NATIONAL HOUSING TRUST FUND.

    (a) Establishment of Trust Fund.--There is established in the 
Treasury of the United States a trust fund to be known as the 
``National Affordable Housing Trust Fund'' (referred to in this Act as 
the ``Trust Fund'') for the purposes of promoting the development of 
affordable housing.
    (b) Deposits to the Trust Fund.--For fiscal year 2001 and each 
fiscal year thereafter, there is appropriated to the Trust Fund an 
amount equal to the sum of--
            (1) any revenue generated by the Mutual Mortgage Insurance 
        Fund of the Federal Housing Administration in excess of the 
        amount necessary for the Mutual Mortgage Insurance Fund to 
        maintain a capital ratio of 3 percent for the preceding fiscal 
        year; and
            (2) any revenue generated by the Government National 
        Mortgage Association in excess of the amount necessary to pay 
        the administrative costs and expenses necessary to ensure the 
        safety and soundness of the Government National Mortgage 
        Association for the preceding fiscal year, as determined by the 
        Secretary.
    (c) Expenditures From the Trust Fund.--For fiscal year 2001 and 
each fiscal year thereafter, amounts appropriated to the Trust Fund 
shall be available to the Secretary of Housing and Urban Development 
for use in accordance with section 4.

SEC. 4. ADMINISTRATION OF NATIONAL AFFORDABLE HOUSING TRUST FUND.

    (a) Definitions.--In this section:
            (1) Affordable housing.--The term ``affordable housing'' 
        means housing for rental that bears rents not greater than the 
        lesser of--
                    (A) the existing fair market rent for comparable 
                units in the area, as established by the Secretary 
                under section 8 of the United States Housing Act of 
                1937 (42 U.S.C. 1437f); or
                    (B) a rent that does not exceed 30 percent of the 
                adjusted income of a family whose income equals 65 
                percent of the median income for the area, as 
                determined by the Secretary, with adjustment for number 
                of bedrooms in the unit, except that the Secretary may 
                establish income ceilings higher or lower than 65 
                percent of the median for the area on the basis of the 
                findings of the Secretary that such variations are 
                necessary because of prevailing levels of construction 
                costs or fair market rents, or unusually high or low 
                family incomes.
            (2) Continued assistance rental subsidy program.--The term 
        ``continued assistance rental subsidy program'' means a program 
        under which--
                    (A) project-based assistance is provided for not 
                more than 3 years to a family in an affordable housing 
                unit developed with assistance made available under 
                subsection (c) or (d) in a project that partners with a 
                public housing agency, which agency agrees to provide 
                the assisted family with a priority for the receipt of 
                a voucher under section 8(o) of the United States 
                Housing Act of 1937 (42 U.S.C. 1437f(o)) if the family 
                chooses to move after an initial year of occupancy and 
                the public housing agency agrees to refer eligible 
                voucher holders to the property when vacancies occur; 
                and
                    (B) after 3 years, subject to appropriations, 
                continued assistance is provided under section 8(o) of 
                the United States Housing Act of 1937 (42 U.S.C. 
                1437f(o)), notwithstanding any provision to the 
                contrary in that section, if administered to provide 
                families with the option of continued assistance with 
                tenant-based vouchers, if such a family chooses to move 
                after an initial year of occupancy and the public 
                housing agency agrees to refer eligible voucher holders 
                to the property when vacancies occur.
            (3) Eligible activities.--The term ``eligible activities'' 
        means activities relating to the development of affordable 
        housing, including--
                    (A) the construction of new housing;
                    (B) the acquisition of real property;
                    (C) site preparation and improvement, including 
                demolition;
                    (D) substantial rehabilitation of existing housing; 
                and
                    (E) rental subsidy for not more than 3 years under 
                a continued assistance rental subsidy program.
            (4) Eligible entity.--The term ``eligible entity'' includes 
        any public or private nonprofit or for-profit entity, unit of 
        local government, regional planning entity, and any other 
        entity engaged in the development of affordable housing, as 
        determined by the Secretary.
            (5) Eligible intermediary.--The term ``eligible 
        intermediary'' means--
                    (A) a nonprofit community development corporation;
                    (B) a community development financial institution 
                (as defined in section 103 of the Community Development 
                Banking and Financial Institutions Act of 1994 (12 
                U.S.C. 4702));
                    (C) a State or local trust fund;
                    (D) any entity eligible for assistance under 
                section 4 of the HUD Demonstration Act of 1993 (42 
                U.S.C. 9816 note);
                    (E) a national, regional, or statewide nonprofit 
                organization; and
                    (F) any other appropriate nonprofit entity, as 
                determined by the Secretary.
            (6) Extremely low-income families.--The term ``extremely 
        low-income families'' means very low-income families (as 
        defined in section 3(b) of the United States Housing Act of 
        1937 (42 U.S.C. 1437a(b)) whose incomes do not exceed 30 
        percent of the median family income for the area, as determined 
        by the Secretary with adjustments for smaller and larger 
        families, except that the Secretary may establish income 
        ceilings higher or lower than 30 percent of the median for the 
        area on the basis of the Secretary's findings that such 
        variations are necessary because of unusually high or low 
        family incomes.
            (7) Low-income families.--The term ``low-income families'' 
        has the meaning given the term in section 3(b) of the United 
        States Housing Act of 1937 (42 U.S.C. 1437a(b)).
            (8) Secretary.--The term ``Secretary'' means the Secretary 
        of Housing and Urban Development.
            (9) State.--The term ``State'' has the meaning given the 
        term in section 3(b) of the United States Housing Act of 1937 
        (42 U.S.C. 1437a(b)).
    (b) Allocation to States and Eligible Intermediaries.--For fiscal 
year 2001 and each fiscal year thereafter, the total amount made 
available to the Secretary from the Trust Fund under section 3(c) shall 
be allocated by the Secretary as follows:
            (1) 75 percent shall be used to award grants to States in 
        accordance with subsection (c).
            (2) 25 percent shall be used to award grants to eligible 
        intermediaries in accordance with subsection (d).
    (c) Grants to States.--
            (1) In general.--Subject to paragraph (2), from the amount 
        made available for each fiscal year under subsection (b)(1), 
        the Secretary shall award grants to States, in accordance with 
        an allocation formula established by the Secretary, based on 
        the pro rata share of each State of the total need among all 
        States for an increased supply of affordable housing, as 
        determined on the basis of--
                    (A) the number and percentage of families in the 
                State that live in substandard housing;
                    (B) the number and percentage of families in the 
                State that pay more than 50 percent of their annual 
                income for housing costs;
                    (C) the number and percentage of persons living at 
                or below the poverty level in the State;
                    (D) the cost of developing or carrying out 
                substantial rehabilitation of housing in the State;
                    (E) the age of the multifamily housing stock in the 
                State; and
                    (F) such other factors as the Secretary determines 
                to be appropriate.
            (2) Grant amount.--
                    (A) In general.--The amount of a grant award to a 
                State under this subsection shall be equal to the 
                lesser of--
                            (i) 4 times the amount of assistance 
                        provided by the State from non-Federal sources; 
                        and
                            (ii) the allocation determined in 
                        accordance with paragraph (1).
                    (B) Non-federal sources.--The following shall be 
                considered non-Federal sources for purposes of this 
                section:
                            (i) 50 percent of funds allocable to tax 
                        credits allocated under section 42 of the 
                        Internal Revenue Code of 1986.
                            (ii) 50 percent of revenue from mortgage 
                        revenue bonds issued under section 143 of such 
                        Code.
                            (iii) 50 percent of proceeds from the sale 
                        of tax exempt bonds.
            (3) Award of state allocation to certain entities.--
                    (A) In general.--If the amount provided by a State 
                from non-Federal sources is less than 25 percent of the 
                amount that would be awarded to the State under this 
                subsection based on the allocation formula described in 
                paragraph (1), not later than 60 days after the date on 
                which the Secretary determines that the State is not 
                eligible for the full allocation determined under 
                paragraph (1), the Secretary shall issue a notice 
                regarding the availability of the funds for which the 
                State is ineligible.
                    (B) Applications.--Not later than 9 months after 
                publication of a notice of funding availability under 
                subparagraph (A), a nonprofit or public entity (or a 
                consortium thereof, which may include units of local 
                government working together on a regional basis) may 
                submit to the Secretary an application for the 
                available assistance or a portion thereof, which 
                application shall include--
                            (i) a certification that the applicant will 
                        provide assistance in an amount equal to 25 
                        percent of the amount of assistance made 
                        available to the applicant under this 
                        paragraph; and
                            (ii) an allocation plan that meets the 
                        requirements of paragraph (4)(B) for use or 
                        distribution in the State of any assistance 
                        made available to the applicant under this 
                        paragraph and the assistance provided by the 
                        applicant for purposes of clause (i).
                    (C) Award of assistance.--The Secretary shall award 
                the amount that is not awarded to a State by operation 
                of paragraph (2) to 1 or more applicants that meet the 
                requirements of subparagraph (B) of this paragraph that 
                are selected by the Secretary based on selection 
                criteria, which shall be established by the Secretary 
                by regulation.
            (4) Distribution to eligible entities.--
                    (A) In general.--Each State that receives a grant 
                award under this subsection shall distribute the amount 
                made available under the grant and the assistance 
                provided by the State from non-Federal sources for 
                purposes of paragraph (2)(A) to eligible entities for 
                the purpose of assisting those entities in carrying out 
                eligible activities in the State as follows:
                            (i) 75 percent shall be distributed to 
                        eligible entities for eligible activities 
                        relating to the development of affordable 
                        housing for rental by extremely low-income 
                        families in the State.
                            (ii) 25 percent shall be distributed to 
                        eligible entities for eligible activities 
                        relating to the development of affordable 
                        housing for rental by low-income families in 
                        the State, or for homeownership assistance for 
                        low-income families in the State.
                    (B) Allocation plan.--Each State shall, after 
                notice to the public, an opportunity for public 
                comment, and consideration of public comments received, 
                establish an allocation plan for the distribution of 
                assistance under this paragraph, which shall be 
                submitted to the Secretary and shall be made available 
                to the public by the State, and which shall include--
                            (i) application requirements for eligible 
                        entities seeking to receive such assistance, 
                        including a requirement that each application 
                        include--
                                    (I) a certification by the 
                                applicant that any housing developed 
                                with assistance under this paragraph 
                                will remain affordable for extremely 
                                low-income families or low-income 
                                families, as applicable, for not less 
                                than 40 years;
                                    (II) a certification by the 
                                applicant that the tenant contribution 
                                towards rent for a family residing in a 
                                unit developed with assistance under 
                                this paragraph will not exceed 30 
                                percent of the adjusted income of that 
                                family; and
                                    (III) a certification by the 
                                applicant that the owner of a project 
                                in which any housing developed with 
                                assistance under this paragraph is 
                                located will make a percentage of units 
                                in the project available to families 
                                assisted under the voucher program 
                                under section 8(o) of the United States 
                                Housing Act of 1937 (42 U.S.C. 
                                1437f(o)) on the same basis as other 
                                families eligible for the housing 
                                (except that only the voucher holder's 
                                expected share of rent shall be 
                                considered), which percentage shall not 
                                be less than the percentage of the 
                                total cost of developing or 
                                rehabilitating the project that is 
                                funded with assistance under this 
                                paragraph; and
                            (ii) factors for consideration in selecting 
                        among applicants that meet such application 
                        requirements, which shall give preference to 
                        applicants based on--
                                    (I) the amount of assistance for 
                                the eligible activities leveraged by 
                                the applicant from private and other 
                                non-Federal sources, including 
                                assistance made available under section 
                                8 of the United States Housing Act of 
                                1937 (42 U.S.C. 1437f) that is devoted 
                                to the project in which the housing to 
                                be developed with assistance under this 
                                paragraph is located;
                                    (II) the extent of local assistance 
                                that will be provided in carrying out 
                                the eligible activities, including--
                                            (aa) financial assistance; 
                                        and
                                            (bb) the extent to which 
                                        the applicant has worked with 
                                        the unit of local government in 
                                        which the housing will be 
located to address issues of siting and exclusionary zoning or other 
policies that are barriers to affordable housing;
                                    (III) the degree to which the 
                                development in which the housing will 
                                be located is mixed-income;
                                    (IV) whether the housing will be 
                                located in a census tract in which the 
                                poverty rate is less than 20 percent or 
                                in a community undergoing 
                                revitalization;
                                    (V) the extent of employment and 
                                other opportunities for low-income 
                                families in the area in which the 
                                housing will be located; and
                                    (VI) the extent to which the 
                                applicant demonstrates the ability to 
                                maintain units as affordable for 
                                extremely low-income or low-income 
                                families, as applicable, through the 
                                use of assistance made available under 
                                this paragraph, assistance leveraged 
                                from non-Federal sources, assistance 
                                made available under section 8 of the 
                                United States Housing Act of 1937 (42 
                                U.S.C. 1437f), State or local 
                                assistance, programs to increase tenant 
                                income, cross-subsidization, and any 
                                other resources.
                    (C) Forms of assistance.--
                            (i) In general.--Assistance distributed 
                        under this paragraph may be in the form of 
                        capital grants, non-interest bearing or low-
                        interest loans or advances, deferred payment 
                        loans, guarantees, and any other forms of 
                        assistance approved by the Secretary.
                            (ii) Repayments.--If a State awards 
                        assistance under this paragraph in the form of 
                        a loan or other mechanism by which funds are 
                        later repaid to the State, any repayments 
                        received by the State shall be distributed by 
                        the State in accordance with the allocation 
                        plan described in subparagraph (B) the 
                        following fiscal year.
                    (D) Coordination with other assistance.--In 
                distributing assistance under this paragraph, each 
                State shall, to the maximum extent practicable, 
                coordinate such distribution with the provision of 
                other affordable housing assistance by the State, 
                including--
                            (i) housing credit dollar amounts allocated 
                        by the State under section 42(h) of the 
                        Internal Revenue Code of 1986;
                            (ii) assistance made available under the 
                        HOME Investment Partnerships Act or the 
                        community development block grant program; and
                            (iii) private activity bonds.
    (d) National Competition.--
            (1) In general.--From the amount made available for each 
        fiscal year under subsection (b)(2), the Secretary shall award 
        grants on a competitive basis to eligible intermediaries, which 
        shall be used in accordance with paragraph (3) of this 
        subsection.
            (2) Application requirements and selection criteria.--The 
        Secretary by regulation shall establish application 
        requirements and selection criteria for the award of 
        competitive grants to eligible intermediaries under this 
        subsection, which criteria shall include--
                    (A) the ability of the eligible intermediary to 
                meet housing needs of low-income families on a national 
                or regional scope;
                    (B) the capacity of the eligible intermediary to 
                use the grant award in accordance with paragraph (3), 
                based on the past performance and management of the 
                applicant; and
                    (C) the extent to which the eligible intermediary 
                has leveraged funding from private and other non-
                Federal sources for the eligible activities.
            (3) Use of grant award.--
                    (A) In general.--Except as provided in subparagraph 
                (B), each eligible intermediary that receives a grant 
                award under this subsection shall ensure that the 
                amount made available under the grant is used as 
                follows:
                            (i) 75 percent shall be used for eligible 
                        activities relating to the development of 
                        affordable housing for rental by extremely low-
                        income families.
                            (ii) 25 percent shall be used for eligible 
                        activities relating to the development of 
                        affordable housing for rental by low-income 
                        families, or for homeownership assistance for 
                        low-income families.
                    (B) Exception.--
                            (i) In general.--If the amount made 
                        available under a grant award under this 
                        subsection is used for a project described in 
                        clause (ii), an eligible intermediary may use 
                        the amount made available under the grant for 
                        eligible activities relating to the development 
                        of housing for rental by families whose incomes 
                        are less than 60 percent of the area median 
                        income, and for homeownership activities for 
                        families whose incomes are less than 80 percent 
                        of area median income.
                            (ii) Project contributing to a concerted 
                        community revitalization plan.--A project is 
                        described in this clause if--
                                    (I) it is located in a community 
                                undergoing concerted revitalization and 
                                is contributing to a community 
                                revitalization plan; and
                                    (II) it is located in a census 
                                tract in which--
                                            (aa) the median household 
                                        income is less than 60 percent 
                                        of the area median income; or
                                            (bb) the rate of poverty is 
                                        greater than 20 percent.
                    (C) Plan of use.--Each eligible intermediary that 
                receives a grant award under this subsection shall 
                establish a plan for the use or distribution of the 
                amount made available under the grant, which shall be 
                submitted to the Secretary, and which shall include 
                information relating to the manner in which the 
                eligible intermediary will either use or distribute 
                that amount, including--
                            (i) a certification that assistance made 
                        available under this subsection will be used to 
                        supplement assistance leveraged from private 
                        and other non-Federal sources, including 
                        assistance made available under section 8 of 
                        the United States Housing Act of 1937 (42 
                        U.S.C. 1437f) that is devoted to the project in 
                        which the housing to be developed is located;
                            (ii) a certification that local assistance 
                        will be provided in the carrying out the 
                        eligible activities, which may include--
                                    (I) financial assistance; and
                                    (II) a good faith effort to work 
                                with the unit of local government in 
                                which the housing will be located to 
                                address issues of siting and 
                                exclusionary zoning or other policies 
                                that are barriers to affordable 
                                housing;
                            (iii) a certification that any housing 
                        developed with assistance under this subsection 
                        will remain affordable for extremely low-income 
                        families or low-income families, as applicable, 
                        for not less than 40 years;
                            (iv) a certification that any housing 
                        developed by the applicant with assistance 
                        under this subsection will be located--
                                    (I) in a mixed-income development 
                                in a census tract having a poverty rate 
                                of not more than 20 percent, and near 
                                employment and other opportunities for 
                                low-income families; or
                                    (II) in a community undergoing 
                                revitalization;
                            (v) a certification that the tenant 
                        contribution towards rent for a family residing 
                        in a unit developed with assistance under this 
                        paragraph will not exceed 30 percent of the 
                        adjusted income of that family; and
                            (vi) a certification by the applicant that 
                        the owner of a project in which any housing 
                        developed with assistance under this subsection 
                        is located will make a percentage of units in 
                        the project available to families assisted 
                        under the voucher program under section 8(o) of 
                        the United States Housing Act of 1937 (42 
                        U.S.C. 1437f(o)) on the same basis as other 
                        families eligible for the housing (except that 
                        only the voucher holder's expected share of 
                        rent shall be considered), which percentage 
                        shall not be less than the percentage of the 
                        total cost of developing or rehabilitating the 
                        project that is funded with assistance under 
                        this subsection.
                    (D) Forms of assistance.--
                            (i) In general.--An eligible intermediary 
                        may distribute the amount made available under 
                        a grant under this subsection in the form of 
                        capital grants, non-interest bearing or low-
                        interest loans or advances, deferred payment 
                        loans, guarantees, and other forms of 
                        assistance.
                            (ii) Repayments.--If an eligible 
                        intermediary awards assistance under this 
                        subsection in the form of a loan or other 
                        mechanism by which funds are later repaid to 
                        the eligible intermediary, any repayments 
                        received by the eligible intermediary shall be 
                        distributed by the eligible intermediary in 
                        accordance with the plan of use described in 
                        subparagraph (C) the following fiscal year.

SEC. 5. REGULATIONS.

    Not later than 6 months after the date of enactment of this Act, 
the Secretary of Housing and Urban Development shall promulgate 
regulations to carry out this Act.
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