I 

111TH CONGRESS 

1ST SESSION H. R. 4099 

To establish incentives to increase the energy efficiency of federally assisted 

housing. 

IN THE HOUSE OF REPRESENTATIVES 

NOVEMBER 18, 2009 

Ms. KILROY (for herself, Mr. BLUMENAUER, Mr. AL GREEN of Texas, Ms. 

HIRONO, Mr. ISRAEL, Mr. MOORE of Kansas, Mr. PERRIELLO, Mr. 

TONKO, Mr. WU, and Mr. SESTAK) introduced the following bill; which 

was referred to the Committee on Financial Services 

A BILL 

To establish incentives to increase the energy efficiency of 

federally assisted housing. 

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 ‘‘Energy Efficiency 

5 Modernization Act of 2009’’. 

6 SEC. 2. CONGRESSIONAL FINDINGS. 

7 The Congress finds that— 

8 (1) federally assisted housing programs provide 

9 robust opportunities for energy efficiency improveVerDate Nov 24 2008 00:24 Nov 19, 2009 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4099.IH H4099

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1 ments and up-front investments in such improve2 ments would provide significant long-term cost sav3 ings for taxpayers, provide stimulus to the economy 

4 through creation of capital projects and jobs, estab5 lish best practices for the industry and be consistent 

6 with the mandate of the Department of Housing and 

7 Urban Development (HUD); 

8 (2) the Government Accountability Office re9 ported in an October 2008 study that HUD pays an 

10 estimated $5 billion annually for energy costs for ap11 proximately 6 million dwelling units of assisted hous12 ing, representing almost 17 percent of the Nation’s 

13 housing stock; 

14 (3) according to the Harvard University Grad15 uate School of Design, more than 80 percent of fed16 erally assisted housing stock is between 15 years to 

17 30 years old; 

18 (4) existing rules and regulations do not ade19 quately incentivize owners of HUD-assisted property 

20 to maximize efforts to make energy efficiency im21 provements to such properties; and 

22 (5) increasing the energy efficiency of federally 

23 assisted housing by 25 percent to 40 percent would 

24 create near-term savings for HUD of roughly $1 bil25 lion to $1.5 billion annually, resulting in substantial 


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1 long-term cost savings for the Federal Government 

2 and for taxpayers. 

3 SEC. 3. GREEN DIVIDEND PROGRAM FOR FEDERALLY AS4 SISTED RENTAL HOUSING. 

5 (a) AUTHORITY.—The Secretary shall establish a 

6 program under this section to provide green dividends to 

7 owners of covered federally assisted housing projects who 

8 undertake utility cost-saving measures that result in util9 ity cost savings for such housing. 

10 (b) GREEN DIVIDENDS.— 

11 (1) IN GENERAL.—A green dividend under this 

12 section with respect to a covered federally assisted 

13 housing project shall be an annual distribution, to 

14 the owner of the project, of an amount of the sur15 plus project funds that is equal to the sum of— 

16 (A) 50 percent of the annual utility cost 

17 savings resulting from the utility cost-saving 

18 measures conducted for the project; and 

19 (B) any reasonable costs, as determined by 

20 the Secretary pursuant to subsection (d)(4), in21 curred by the owner in carrying out the utility 

22 cost-saving measures, including financing costs 

23 incurred by the owner or a third party, in com24 pliance with guidelines established pursuant to 

25 subsection (d)(3). 


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1 (2) ADDITIONAL TO STANDARD DISTRIBU2 TION.—Notwithstanding any other law or regulation 

3 relating to a limitation on distributions for a covered 

4 federally assisted housing project, a green dividend 

5 under this section shall be in addition to the stand6 ard distribution that the owner of the project is au7 thorized to receive from the project pursuant to the 

8 regulations of the Secretary. 

9 (c) STANDARDS FOR MEASUREMENT AND MONI10 TORING.—In carrying out the program under this section, 

11 the Secretary shall establish and utilize the following 

12 standardized methods: 

13 (1) Methods that an owner of a covered feder14 ally assisted housing project may use to accurately 

15 measure the baseline utility use of the project before 

16 undertaking the utility cost-saving measures for the 

17 project. 

18 (2) Methods that an owner of a covered feder19 ally assisted housing project may use to effectively 

20 monitor reductions in the utility use of the project 

21 resulting from the completed utility cost-saving 

22 measures for the project. 

23 (3) Methods that an owner of a covered feder24 ally assisted housing project may use to track, and 

25 that the Secretary may use to verify, utility cost savVerDate Nov 24 2008 00:24 Nov 19, 2009 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4099.IH H4099

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1 ings resulting from the utility cost-saving measures 

2 for the project that account for the effect of changes 

3 in utility costs and such other factors that the Sec4 retary considers necessary or appropriate. 

5 (d) OTHER REQUIREMENTS.— 

6 (1) APPLICATION AND SELECTION.—The Sec7 retary shall establish requirements for owners of 

8 covered federally assisted housing projects to apply 

9 for participation in the program under this section 

10 and shall select among such applications based upon 

11 selection criteria, which the Secretary shall establish. 

12 (2) COST-EFFECTIVENESS.—The Secretary 

13 shall establish guidelines to ensure that any utility 

14 cost-saving measures undertaken pursuant to the 

15 program under this section are cost-effective in rela16 tion to the utility cost savings resulting from the 

17 measures and the green dividend provided under this 

18 section to the owner. 

19 (3) ENERGY PERFORMANCE CONTRACTS.—The 

20 Secretary shall establish guidelines for the use of en21 ergy performance contracting in carrying out utility 

22 cost-saving measures pursuant to the program under 

23 this section. 

24 (4) FINANCING COSTS.—The Secretary shall es25 tablish guidelines for the financing of the reasonable 


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1 costs incurred by an owner of a covered federally as2 sisted housing project in carrying out utility cost3 saving measures under the program under this sec4 tion, and whether such costs, whether financed by 

5 the limited dividend owner or a third party, shall be 

6 repayable from project funds. 

7 (5) REPORTING.— 

8 (A) TO SECRETARY.—The Secretary shall 

9 require each owner of a covered federally as10 sisted housing project for which a green divi11 dend is provided pursuant to the program 

12 under this section to submit to the Secretary 

13 such reports regarding the project, the utility 

14 cost-saving measures undertaken for the 

15 project, and the utility cost savings of the 

16 project in accordance with such requirements as 

17 the Secretary shall establish. 

18 (B) TO CONGRESS.—The Secretary shall 

19 submit reports to the Congress describing the 

20 implementation and operation of the program 

21 under this section, as follows: 

22 (i) INITIAL REPORT.—The Secretary 

23 shall submit reports describing the initial 

24 implementation and operation of the pro25 gram not later than the expiration of the 


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1 180-day period beginning upon the date of 

2 the enactment of this Act. 

3 (ii) ANNUAL REPORTS.—Not later 

4 than the expiration of the 12-month period 

5 that begins upon the expiration of the pe6 riod specified clause (i), and upon the expi7 ration of each successive 12-month period 

8 thereafter, the Secretary shall submit a re9 port describing the ongoing operation of 

10 the program. 

11 (e) PREEMPTION OF CONFLICTING STATE LAWS

12 LIMITING DISTRIBUTIONS.— 

13 (1) IN GENERAL.—Except as provided in para14 graph (2), no State or political subdivision of a 

15 State may establish, continue in effect, or enforce 

16 any law, regulation, or administrative requirement 

17 that limits or restricts, to an amount that is less 

18 than the sum of the amounts provided for under 

19 paragraphs (1) and (2) of subsection (b), the 

20 amount of surplus project funds accruing after the 

21 date of the enactment of this section that may be 

22 distributed from any covered federally assisted hous23 ing project. 


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1 (2) EXCEPTION AND WAIVER.—Paragraph (1) 

2 shall not apply to any law or regulation to the extent 

3 such law or regulation applies to— 

4 (A) a State-financed covered federally as5 sisted housing project; or 

6 (B) a covered federally assisted housing 

7 project for which the owner has elected to waive 

8 the applicability of paragraph (1). 

9 (f) DEFINITIONS.—For purposes of this section, the 

10 following definitions shall apply: 

11 (1) COVERED FEDERALLY ASSISTED HOUSING

12 PROJECT.—The term ‘‘covered federally assisted 

13 housing project’’ means any multifamily rental hous14 ing project that— 

15 (A) is provided any rental assistance, 

16 mortgage insurance, subsidy, or other financial 

17 assistance by the Secretary; and 

18 (B) that is subject to a limitation on dis19 tributions, to the owner, of project funds under 

20 section 200.106(a), 236.1(c), 880.205(b), 

21 881.205(b), or 883.306(b) of title 24 of the 

22 Code of Federal Regulations, or any other stat23 ute or regulation applicable to the project. 

24 (2) SECRETARY.—The term ‘‘Secretary’’ means 

25 the Secretary of Housing and Urban Development. 


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1 (3) SURPLUS PROJECT FUNDS.—The term 

2 ‘‘surplus project funds’’ means, with respect to a 

3 covered federally assisted housing project, the net 

4 revenue of the project after all project expenses have 

5 been paid, or funds have been set aside for the pay6 ment thereof, and any reserve requirements applica7 ble to the project have been met. 

8 (4) UTILITY COST SAVINGS.—The term ‘‘utility 

9 cost savings’’ means, with respect to utility cost-sav10 ing measures undertaken for a covered federally as11 sisted housing project, the difference between— 

12 (A) the energy or water costs that would 

13 have been incurred for the project if such utility 

14 cost-saving measures were not completed; and 

15 (B) the actual energy or water costs for 

16 the project after completion of the utility cost17 saving measures. 

18 (5) UTILITY COST-SAVING MEASURES.—The 

19 term ‘‘utility cost-saving measures’’ means, with re20 spect to a covered federally assisted housing project, 

21 any rehabilitation, renovation, retrofit, improvement, 

22 or alteration for the project that incorporates any 

23 technology, equipment, fixture, or material, or pro24 motes any practice, designed to reduce the energy or 

25 water consumption of the project. 


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1 (g) REGULATIONS.—Not later than the expiration of 

2 the 180-day period beginning on the date of the enactment 

3 of this Act, the Secretary shall issue any regulations nec4 essary to carry out this section. 

5 SEC. 4. USE OF RESIDUAL RECEIPTS AND RESERVE FOR 

6 REPLACEMENTS FUNDS FOR GREEN RETRO7 FITS OF FEDERALLY ASSISTED RENTAL 

8 HOUSING. 

9 (a) AUTHORITY.—The Secretary shall carry out a 

10 program under this section to make loans funded from re11 sidual receipts to owners of federally assisted housing 

12 projects for undertaking green retrofit measures for such 

13 housing and to encourage the broader use of reserve for 

14 replacements funds to pay for the costs of green retrofit 

15 measures for such housing. 

16 (b) GREEN RETROFIT MEASURES.—For purposes of 

17 this section, a green retrofit measure with respect to a 

18 federally assisted housing project shall be any measure for 

19 rehabilitation, renovation, retrofit, improvement, or alter20 ation for the project that— 

21 (1) is designed to reduce utility consumption, 

22 including water, gas, and electricity, or increase en23 ergy efficiency, for the project; 

24 (2) provides a renewable energy system for the 

25 project that generates energy from a naturally reVerDate Nov 24 2008 00:24 Nov 19, 2009 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H4099.IH H4099

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1 plenished energy source or sources, such as sunlight, 

2 wind, rain, tides, which shall include hydroelectricity, 

3 biomass, cogeneration, and new renewable tech4 nologies that have yet to be developed; or 

5 (3) is designed to improve indoor air quality or 

6 occupant health and safety, which shall include 

7 measures reducing the potential for mold and other 

8 allergens, measures improving fresh air ventilation, 

9 and installation of carbon monoxide sensors not re10 quired by local codes. 

11 (c) TERMS OF LOANS FUNDED FROM RESIDUAL RE12 CEIPTS AND WITHDRAWALS FROM RESERVE FOR RE13 PLACEMENTS FUNDS FOR GREEN RETROFIT MEAS14 URES.—Loans under this section and withdrawals from 

15 reserve for replacements funds under this section shall be 

16 subject to such terms and conditions as the Secretary shall 

17 establish, which shall include the following: 

18 (1) USE.—Any loan amounts received, or with19 drawals from reserve for replacements funds, may be 

20 used only for green retrofit measures set forth in the 

21 application approved by the Secretary pursuant to 

22 subsection (d)(1). 

23 (2) AMOUNT.—The amount of any loan, or 

24 withdrawal from reserve for replacements funds, for 

25 any federally assisted housing project may not exVerDate Nov 24 2008 00:24 Nov 19, 2009 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H4099.IH H4099

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1 ceed the amount necessary to carry out the green 

2 retrofit measures set forth in the approved applica3 tion. 

4 (3) LOAN TERM AND INTEREST RATE.—Each 

5 loan funded from residual receipts shall have a term 

6 to maturity that is satisfactory to the Secretary and 

7 shall bear interest at a rate that is satisfactory to 

8 the Secretary. 

9 (d) OTHER REQUIREMENTS.— 

10 (1) APPLICATION AND SELECTION.—The Sec11 retary shall establish requirements for owners of fed12 erally assisted housing projects to apply for loans to 

13 be funded from residual receipts and to apply for the 

14 use of reserve for replacements funds under this sec15 tion and shall select among such applications based 

16 upon selection criteria, which the Secretary shall es17 tablish. 

18 (2) REPORTING.— 

19 (A) TO SECRETARY.—The Secretary shall 

20 require each owner of a federally assisted hous21 ing project for which a loan is provided under 

22 this section, or for which the Secretary ap23 proves the use of reserve for replacements funds 

24 for green retrofit measures pursuant to this 

25 section, to submit to the Secretary such reports 


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1 regarding the green retrofit measures under2 taken for the project in accordance with such 

3 requirements as the Secretary shall establish. 

4 (B) TO CONGRESS.—The Secretary shall 

5 submit reports to the Congress describing the 

6 implementation and operation of the loan pro7 gram under this section, as follows: 

8 (i) INITIAL REPORT.—The Secretary 

9 shall submit a report describing the initial 

10 implementation and operation of the pro11 gram not later than the expiration of the 

12 180-day period beginning upon the date of 

13 the enactment of this Act. 

14 (ii) ANNUAL REPORTS.—Not later 

15 than the expiration of the 12-month period 

16 that begins upon the expiration of the pe17 riod specified clause (i), and upon the expi18 ration of each successive 12-month period 

19 thereafter, the Secretary shall submit a re20 port describing the ongoing operation of 

21 the program. 

22 (e) DEFINITIONS.—For purposes of this section, the 

23 following definitions shall apply: 

24 (1) FEDERALLY ASSISTED HOUSING

25 PROJECT.—The term ‘‘federally assisted housing 


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1 project’’ means any multifamily rental housing 

2 project for which any rental assistance, mortgage in3 surance, subsidy, or other financial assistance is pro4 vided by the Secretary. 

5 (2) SECRETARY.—The term ‘‘Secretary’’ means 

6 the Secretary of Housing and Urban Development. 

7 (f) FUNDING.— 

8 (1) PROJECT RESIDUAL RECEIPTS.—Notwith9 standing any other provision of law, regulation, or 

10 administrative requirement to the contrary, the Sec11 retary may authorize the withdrawal of residual re12 ceipts in the residual receipts account of a federally 

13 assisted housing project, in any amount that the 

14 Secretary determines is not needed, and will not be 

15 needed, during the term of the use restrictions appli16 cable to the project to ensure the project’s afford17 ability, for costs (as such term is defined in section 

18 502 of the Federal Credit Reform Act of 1990 (2 

19 U.S.C. 661a)) of a loan under this section to the 

20 owner of such federally assisted housing project, 

21 which loan may be for such federally assisted hous22 ing project or for another federally assisted housing 

23 project also owned by such owner. 

24 (2) RESIDUAL RECEIPTS UPON EXPIRATION OF

25 FEDERAL ASSISTANCE.—Notwithstanding any other 


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1 provision of law, regulation, or administrative re2 quirement to the contrary, any funds remaining in 

3 the residual receipts account of a federally assisted 

4 housing project upon the expiration or termination 

5 of the Federal assistance received by such project 

6 that are returned, or are required to be returned, to 

7 the Secretary under any under Federal law, regula8 tion or administrative requirement may be used by 

9 the Secretary for costs (as such term is defined in 

10 section 502 of the Federal Credit Reform Act of 

11 1990 (2 U.S.C. 661a)) of loans under this section to 

12 any federally assisted housing project. 

13 (3) PROJECT RESERVE FOR REPLACEMENTS

14 FUNDS.—Notwithstanding any other provision of 

15 law, regulation, or administrative requirement to the 

16 contrary, the Secretary may authorize the owner of 

17 a federally assisted housing project to make with18 drawals from the reserve for replacements fund of a 

19 federally assisted housing project, in any amount 

20 that the Secretary deems necessary or appropriate, 

21 to fund green retrofit measures for such federally 

22 assisted housing project or for another federally as23 sisted housing project owned by such owner. 

24 (g) REGULATIONS.—Not later than the expiration of 

25 the 180-day period beginning on the date of the enactment 


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1 of this Act, the Secretary shall issue any regulations nec2 essary to carry out this section. 

3 SEC. 5. STUDY ON EXEMPTION FROM BUILDING CODES TO 

4 ALLOW DISTRIBUTIVE ENERGY GENERATION 

5 MEASURES AND WATER EFFICIENCY MEAS6 URES. 

7 (a) STUDY.—The Comptroller General of the United 

8 States shall conduct a study to analyze and determine the 

9 benefits of establishing a statutory exemption under Fed10 eral law from compliance with provisions of State and local 

11 building codes that do not affect the health or safety of 

12 residents of multifamily housing assisted by the Depart13 ment of Housing and Urban Development to enable and 

14 encourage the construction and installation in such 

15 projects of distributive energy generation measures and 

16 water efficiency measures. 

17 (b) PROVISION OF INFORMATION TO ENERGY INFOR18 MATION ADMINISTRATION.—The Comptroller General 

19 shall provide any information collected in conducting the 

20 study under this section to the Secretary of Energy to sup21 plement information collected and maintained by the En22 ergy Information Administration of the Department of 

23 Energy regarding residential energy consumption. 

24 (c) REPORT.—Not later than the expiration of the 6- 

25 month period beginning on the date of the enactment of 


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1 this Act, the Comptroller General shall submit a report 

2 to the Congress and to the Secretary of Energy setting 

3 forth the results and conclusions of the study under this 

4 section. 

5 SEC. 6. REPORTS ON UTILITY CONSUMPTION FOR HUD-AS6 SISTED MULTIFAMILY PROJECTS. 

7 (a) IN GENERAL.—To assist the Secretary of Hous8 ing and Urban Development in determining how and 

9 where to undertake energy and other utility efficiency 

10 measures, the Secretary shall, by regulation, require each 

11 owner of an assisted multifamily housing project to report 

12 regularly to the Secretary regarding consumption by the 

13 project of electricity, water, gas, and other utilities. 

14 (b) ANNUAL REPORT BY SECRETARY.—The Sec15 retary shall compile the information received pursuant to 

16 subsection (a) and submit a report to the Congress and 

17 the Energy Information Administration annually regard18 ing total utility consumption by assisted multifamily hous19 ing projects. The report shall include all non-aggregated 

20 data submitted to the Secretary pursuant to subsection 

21 (a). 

22 (c) ASSISTED MULTIFAMILY HOUSING PROJECT.— 

23 For purposes of this section, the term ‘‘assisted multi24 family housing project’’ means any multifamily housing 

25 project that is— 


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1 (1) provided project-based assistance under sec2 tion 8 of the United States Housing Act of 1937, in3 cluding new construction and substantial rehabilita4 tion projects; 

5 (2) assisted under section 202 of the Housing 

6 Act of 1959 (as amended by section 801 of the 

7 Cranston-Gonzalez National Affordable Housing 

8 Act); 

9 (3) assisted under section 202 of the Housing 

10 Act of 1959, as such section existed before the en11 actment of the Cranston-Gonzalez National Afford12 able Housing Act; 

13 (4) assisted under section 811 of the Cranston14 Gonzalez National Affordable Housing Act; 

15 (5) financed by a loan or mortgage insured 

16 under section 221(d)(3) of the National Housing Act 

17 that bears interest at a rate determined under the 

18 proviso of section 221(d)(5) of such Act; or 

19 (6) insured, assisted, or held by the Secretary 

20 or a State or State agency under section 236 of the 

21 National Housing Act. 

Æ 


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