103D CONGRESS

1ST SESSION S. 1299

AN ACT

To reform requirements for the disposition of mulcrime, and for other purposes. gram flexibility, authorize a program to combat Housing and Urban Development, enhance pro- tifamily property owned by the Secretary of
103D CONGRESS

1ST SESSION S. 1299

AN ACT

To reform requirements for the disposition of multifamily

property owned by the Secretary of Housing and Urban

Development, enhance program flexibility, authorize a

program to combat crime, 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 and Commu5 nity Development Act of 1993’’.
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1 SEC. 2. TABLE OF CONTENTS.

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

Sec. 1. Short title.

Sec. 2. Table of contents.

Sec. 3. Definitions.

TITLE I—FHA MULTIFAMILY REFORMS

Sec. 101. Multifamily property disposition.

Sec. 102. Repeal of State agency multifamily property disposition demonstration.

Sec. 103. RTC marketing and disposition of multifamily projects owned by

HUD.

Sec. 104. Civil money penalties against general partners and certain managing

agents of multifamily housing projects.

Sec. 105. Models for property disposition.

Sec. 106. Preventing mortgage defaults.

Sec. 107. Interest rates on assigned mortgages.

Sec. 108. Authorization of appropriations.

TITLE II—ENHANCED PROGRAM FLEXIBILITY

Subtitle A—Office of Public and Indian Housing

Sec. 201. Revitalization of severely distressed public housing.

Sec. 202. Disallowance of earned income for residents who obtain employment.

Sec. 203. Ceiling rents based on reasonable rental value.

Sec. 204. Resident management program.

Subtitle B—Office of Community Planning and Development

Sec. 211. Economic development initiative.

Sec. 212. HOME investment partnerships.

Sec. 213. HOPE match requirement.

Sec. 214. Flexibility of CDBG program for disaster areas.

Sec. 215. Flexibility of HOME program for disaster areas.

Subtitle C—Community Partnerships Against Crime

Sec. 221. COMPAC program.

TITLE III—TECHNICAL AND OTHER AMENDMENTS

Subtitle A—Public and Assisted Housing

Sec. 301. Correction to definition of family.

Sec. 302. Identification of CIAP replacement needs.

Sec. 303. Applicability of public housing amendments to Indian housing.

Sec. 304. Project-based accounting.

Sec. 305. Operating subsidy adjustments for anticipated fraud recoveries.

Sec. 306. Technical assistance for lead hazard reduction grantees.

Sec. 307. Environmental review in connection with grants for lead-based paint

hazard reduction.

Sec. 308. Fire safety in federally assisted housing.

Sec. 309. Section 23 conversion projects.
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Sec. 310. Indemnification of contractors for intellectual property rights disputes.

Sec. 311. Assumption of environmental review responsibilities under United

States Housing Act of 1937 programs.

Sec. 312. Increased State flexibility in the Low-Income Home Energy Assistance Program.

Subtitle B—Multifamily Housing

Sec. 321. Correction of multifamily mortgage limits.

Sec. 322. FHA multifamily risk-sharing; HFA pilot program amendments.

Sec. 323. Subsidy layering review.

Subtitle C—Miscellaneous and Technical Amendments

Sec. 331. Technical correction to rural housing preservation program.

Sec. 332. CDBG technical amendment.

Sec. 333. Environmental review in connection with special projects.

TITLE IV—GENERAL PROVISIONS

Sec. 401. Mount Rushmore Commemorative Coin Act.

Sec. 402. Minority community development grants for communities with special

needs.

1 SEC. 3. DEFINITIONS.

2 As used in this Act—

3 (1) the term ‘‘FHA’’ means the Federal Hous4 ing Administration;

5 (2) the term ‘‘Secretary’’ means the Secretary

6 of Housing and Urban Development; and

7 (3) the term ‘‘RTC’’ means the Resolution

8 Trust Corporation.

9 TITLE I—FHA MULTIFAMILY

10 REFORMS

11 SEC. 101. MULTIFAMILY PROPERTY DISPOSITION.

12 (a) FINDINGS.—The Congress finds that—

13 (1) the portfolio of multifamily housing project

14 mortgages insured by the FHA is severely troubled

15 and at risk of default, requiring the Secretary to in-
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1 crease loss reserves from $5.5 billion in 1991 to

2 $11.9 billion in 1992 to cover estimated future

3 losses;

4 (2) the inventory of multifamily housing

5 projects owned by the Secretary has more than tri6 pled since 1989, and, by the end of 1993, may ex7 ceed 75,000 units;

8 (3) the cost to the Federal Government of own9 ing and maintaining multifamily housing projects es10 calated to approximately $250 million in fiscal year

11 1992;

12 (4) the inventory of multifamily housing

13 projects subject to mortgages held by the Secretary

14 has increased dramatically, to more than 2,400

15 mortgages, and approximately half of these mort16 gages, secured by projects with over 230,000 units,

17 are delinquent;

18 (5) the inventory of insured and formerly in19 sured multifamily housing projects is rapidly deterio20 rating, endangering tenants and neighborhoods;

21 (6) over 5 million very low-income families

22 today have a critical need for housing that is afford23 able and habitable; and

24 (7) the current statutory framework governing

25 the disposition of multifamily housing projects effec-
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1 tively impedes the Government’s ability to dispose of

2 properties, protect tenants, and ensure that projects

3 are maintained over time.

4 (b) MANAGEMENT AND DISPOSITION OF MULTIFAM5 ILY HOUSING PROJECTS.—Section 203 of the Housing

6 and Community Development Amendments of 1978 (12

7 U.S.C. 1701z–11) is amended to read as follows:

8 ‘‘SEC. 203. MANAGEMENT AND DISPOSITION OF MULTIFAM9 ILY HOUSING PROJECTS.

10 ‘‘(a) GOALS.—The Secretary of Housing and Urban

11 Development (hereafter in this section referred to as the

12 ‘Secretary’) shall manage or dispose of multifamily hous13 ing projects that are owned by the Secretary or that are

14 subject to a mortgage held by the Secretary in a manner

15 that—

16 ‘‘(1) is consistent with the National Housing

17 Act and this section;

18 ‘‘(2) will protect the financial interests of the

19 Federal Government; and

20 ‘‘(3) will, in the least costly fashion among rea21 sonable available alternatives, further the goals of—

22 ‘‘(A) preserving housing so that it can re23 main available to and affordable by low-income

24 persons;
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1 ‘‘(B) preserving and revitalizing residential

2 neighborhoods;

3 ‘‘(C) maintaining existing housing stock in

4 a decent, safe, and sanitary condition;

5 ‘‘(D) minimizing the involuntary displace6 ment of tenants;

7 ‘‘(E) maintaining housing for the purpose

8 of providing rental housing, cooperative hous9 ing, and homeownership opportunities for low10 income persons; and

11 ‘‘(F) minimizing the need to demolish mul12 tifamily housing projects.

13 The Secretary, in determining the manner in which a

14 project is to be managed or disposed of, shall balance com15 peting goals relating to individual projects in a manner

16 that will further the purposes of this section.

17 ‘‘(b) DEFINITIONS.—For purposes of this section, the

18 following definitions shall apply:

19 ‘‘(1) MULTIFAMILY HOUSING PROJECT.—The

20 term ‘multifamily housing project’ means any multi21 family rental housing project that is, or prior to ac22 quisition by the Secretary was, assisted or insured

23 under the National Housing Act, or was subject to

24 a loan under section 202 of the Housing Act of

25 1959.
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1 ‘‘(2) SUBSIDIZED PROJECT.—The term ‘sub2 sidized project’ means a multifamily housing project

3 receiving any of the following types of assistance im4 mediately prior to the assignment of the mortgage

5 on such project to, or the acquisition of such mort6 gage by, the Secretary:

7 ‘‘(A) Below market interest rate mortgage

8 insurance under the proviso of section

9 221(d)(5) of the National Housing Act.

10 ‘‘(B) Interest reduction payments made in

11 connection with mortgages insured under sec12 tion 236 of the National Housing Act.

13 ‘‘(C) Direct loans made under section 202

14 of the Housing Act of 1959.

15 ‘‘(D) Assistance in the form of—

16 ‘‘(i) rent supplement payments under

17 section 101 of the Housing and Urban De18 velopment Act of 1965;

19 ‘‘(ii) additional assistance payments

20 under section 236(f)(2) of the National

21 Housing Act;

22 ‘‘(iii) housing assistance payments

23 made under section 23 of the United

24 States Housing Act of 1937 (as in effect

25 before January 1, 1975); or
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1 ‘‘(iv) housing assistance payments

2 made under section 8 of the United States

3 Housing Act of 1937 (excluding payments

4 made for tenant-based assistance under

5 section 8);

6 if (except for purposes of section 183(c) of the

7 Housing and Community Development Act of

8 1987) such assistance payments are made to

9 more than 50 percent of the units in the

10 project.

11 ‘‘(3) FORMERLY SUBSIDIZED PROJECT.—The

12 term ‘formerly subsidized project’ means a multi13 family housing project owned by the Secretary that

14 was a subsidized project immediately prior to its ac15 quisition by the Secretary.

16 ‘‘(4) UNSUBSIDIZED PROJECT.—The term

17 ‘unsubsidized project’ means a multifamily housing

18 project owned by the Secretary that is not a sub19 sidized project or a formerly subsidized project.

20 ‘‘(c) MANAGEMENT OR DISPOSITION OF PROP21 ERTY.—

22 ‘‘(1) DISPOSITION TO PURCHASERS.—The Sec23 retary is authorized, in carrying out this section, to

24 dispose of a multifamily housing project owned by

25 the Secretary on a negotiated, competitive bid, or
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1 other basis, on such terms as the Secretary deems

2 appropriate considering the low-income character of

3 the project and the requirements of subsection (a),

4 to a purchaser determined by the Secretary to be ca5 pable of—

6 ‘‘(A) satisfying the conditions of the dis7 position plan;

8 ‘‘(B) implementing a sound financial and

9 physical management program that is designed

10 to enable the project to meet anticipated oper11 ating and repair expenses to ensure that the

12 project will remain in decent, safe, and sanitary

13 condition;

14 ‘‘(C) responding to the needs of the ten15 ants and working cooperatively with tenant or16 ganizations;

17 ‘‘(D) providing adequate organizational,

18 staff, and financial resources to the project; and

19 ‘‘(E) meeting such other requirements as

20 the Secretary may determine.

21 ‘‘(2) CONTRACTING FOR MANAGEMENT SERV22 ICES.—The Secretary is authorized, in carrying out

23 this section—

24 ‘‘(A) to contract for management services

25 for a multifamily housing project that is owned
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1 by the Secretary (or for which the Secretary is

2 mortgagee in possession), on a negotiated, com3 petitive bid, or other basis at a price deter4 mined by the Secretary to be reasonable, with

5 a manager the Secretary has determined is ca6 pable of—

7 ‘‘(i) implementing a sound financial

8 and physical management program that is

9 designed to enable the project to meet an10 ticipated operating and maintenance ex11 penses to ensure that the project will re12 main in decent, safe, and sanitary condi13 tion;

14 ‘‘(ii) responding to the needs of the

15 tenants and working cooperatively with

16 tenant organizations;

17 ‘‘(iii) providing adequate organiza18 tional, staff, and other resources to imple19 ment a management program; and

20 ‘‘(iv) meeting such other requirements

21 as the Secretary may determine; and

22 ‘‘(B) to require the owner of a multifamily

23 housing project that is subject to a mortgage

24 held by the Secretary to contract for manage-
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1 ment services for the project in the manner de2 scribed in subparagraph (A).

3 ‘‘(3) FORECLOSURE SALE.—In carrying out this

4 section, the Secretary shall—

5 ‘‘(A) prior to foreclosing on any multifam6 ily housing project held by the Secretary, notify

7 both the unit of general local government in

8 which the property is located and the tenants of

9 the property of the proposed foreclosure sale;

10 and

11 ‘‘(B) upon disposition of a multifamily

12 housing project through a foreclosure sale, de13 termine that the purchaser is capable of imple14 menting a sound financial and physical manage15 ment program that is designed to enable the

16 project to meet anticipated operating and repair

17 expenses to ensure that the project will remain

18 in decent, safe, and sanitary condition.

19 ‘‘(d) MAINTENANCE OF HOUSING PROJECTS.—

20 ‘‘(1) HOUSING PROJECTS OWNED BY THE SEC21 RETARY.—In the case of multifamily housing

22 projects that are owned by the Secretary (or for

23 which the Secretary is mortgagee in possession), the

24 Secretary shall—
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1 ‘‘(A) to the greatest extent possible, main2 tain all such occupied projects in a decent, safe,

3 and sanitary condition;

4 ‘‘(B) to the greatest extent possible, main5 tain full occupancy in all such projects; and

6 ‘‘(C) maintain all such projects for pur7 poses of providing rental or cooperative hous8 ing.

9 ‘‘(2) HOUSING PROJECTS SUBJECT TO A MORT10 GAGE HELD BY THE SECRETARY.—In the case of

11 any multifamily housing project that is subject to a

12 mortgage held by the Secretary, the Secretary shall

13 require the owner of the project to carry out the re14 quirements of paragraph (1).

15 ‘‘(e) REQUIRED ASSISTANCE.—In carrying out the

16 goals specified in subsection (a), the Secretary shall take

17 not less than one of the following actions:

18 ‘‘(1) CONTRACT WITH OWNER.—Enter into con19 tracts under section 8 of the United States Housing

20 Act of 1937, to the extent budget authority is avail21 able, with owners of multifamily housing projects

22 that are acquired by a purchaser other than the Sec23 retary at foreclosure or after sale by the Secretary.

24 ‘‘(A) SUBSIDIZED OR FORMERLY SUB25 SIDIZED PROJECTS RECEIVING CERTAIN ASSIST-
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1 ANCE.—In the case of a subsidized project re2 ferred to in subparagraph (A), (B), or (C) of

3 subsection (b)(2) or a formerly subsidized

4 project that was subsidized as described in any

5 such subparagraph—

6 ‘‘(i) the contract shall be sufficient to

7 assist at least all units covered by an as8 sistance contract under any of the authori9 ties referred to in subsection (b)(2)(D) be10 fore acquisition, unless the Secretary acts

11 pursuant to the provisions of subparagraph

12 (C) of this paragraph;

13 ‘‘(ii) in the case of units requiring

14 project-based rental assistance pursuant to

15 clause (i) that are occupied by families who

16 are not eligible for assistance under section

17 8, a contract under this subparagraph

18 shall also provide that when a vacancy oc19 curs, the owner shall lease the available

20 unit to a family eligible for assistance

21 under section 8; and

22 ‘‘(iii) the Secretary shall take actions

23 to ensure the availability and affordability,

24 as defined in paragraph (3)(B), for the re25 maining useful life of the project, as de-
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1 fined by the Secretary, of any unit located

2 in any project referred to in subparagraph

3 (A), (B), or (C) of subsection (b)(2) that

4 does not otherwise receive project-based

5 rental assistance under this subparagraph.

6 To carry out this clause, the Secretary

7 may require purchasers to establish use or

8 rent restrictions on these units.

9 ‘‘(B) SUBSIDIZED OR FORMERLY SUB10 SIDIZED PROJECTS RECEIVING OTHER ASSIST11 ANCE.—In the case of a subsidized project re12 ferred to in subsection (b)(2)(D) or a formerly

13 subsidized project that was subsidized as de14 scribed in subsection (b)(2)(D)—

15 ‘‘(i) the contract shall be sufficient to

16 assist at least all units in the project that

17 are covered, or that were covered imme18 diately before foreclosure on or acquisition

19 of the project by the Secretary, by an as20 sistance contract under any of the authori21 ties referred to in such subsection, unless

22 the Secretary acts pursuant to provisions

23 of subparagraph (C); and

24 ‘‘(ii) in the case of units requiring

25 project-based rental assistance pursuant to
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1 clause (i) that are occupied by families who

2 are not eligible for assistance under section

3 8, a contract under this paragraph shall

4 also provide that when a vacancy occurs,

5 the owner shall lease the available unit to

6 a family eligible for assistance under sec7 tion 8.

8 ‘‘(C) EXCEPTIONS TO SUBPARAGRAPHS (A)

9 AND (B).—In lieu of providing project-based

10 rental assistance under subparagraph (A) or

11 (B), the Secretary may require certain units in

12 unsubsidized projects to contain use restrictions

13 providing that such units will be available to

14 and affordable by very low-income families for

15 the remaining useful life of the project, as de16 fined by the Secretary, if—

17 ‘‘(i) the Secretary matches any reduc18 tion in the number of units otherwise re19 quired to be assisted with project-based

20 rental assistance under subparagraph (A)

21 or (B) with at least an equivalent increase

22 in the number of units made affordable, as

23 such term is defined in paragraph (3)(B),

24 to very low-income persons within

25 unsubsidized projects;
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1 ‘‘(ii) the Secretary makes tenant2 based assistance under section 8 available

3 to low-income tenants residing in units

4 otherwise requiring project-based rental as5 sistance under subparagraph (A) or (B)

6 upon disposition; and

7 ‘‘(iii) the units described in clause (i)

8 are located within the same market area.

9 ‘‘(D) CONTRACT REQUIREMENTS FOR

10 UNSUBSIDIZED PROJECTS.—Notwithstanding

11 actions that are taken pursuant to subpara12 graph (C), in any unsubsidized project—

13 ‘‘(i) the contract shall be at least suf14 ficient to provide project-based rental as15 sistance for all units that are covered or

16 were covered immediately before fore17 closure or acquisition by an assistance con18 tract under—

19 ‘‘(I) section 8(b)(2) of the United

20 States Housing Act of 1937, as such

21 section existed before October 1, 1983

22 (new construction and substantial re23 habilitation); section 8(b) of such Act

24 (property disposition); section 8(d)(2)

25 of such Act (project-based certifi-
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1 cates); section 8(e)(2) of such Act

2 (moderate rehabilitation); section 23

3 of such Act (as in effect before Janu4 ary 1, 1975); or section 101 of the

5 Housing and Urban Development Act

6 of 1965 (rent supplements); or

7 ‘‘(II) section 8 of the United

8 States Housing Act of 1937, following

9 conversion from section 101 of the

10 Housing and Urban Development Act

11 of 1965; and

12 ‘‘(ii) the Secretary shall make avail13 able tenant-based assistance under section

14 8 of the United States Housing Act of

15 1937 to tenants currently residing in units

16 that were covered by an assistance contract

17 under the Loan Management Set-Aside

18 program under section 8(b) of the United

19 States Housing Act of 1937 immediately

20 before foreclosure or acquisition of the

21 project by the Secretary.

22 ‘‘(2) ANNUAL CONTRIBUTION CONTRACTS.—In

23 the case of multifamily housing projects that are ac24 quired by a purchaser other than the Secretary at

25 foreclosure or after sale by the Secretary, enter into
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1 annual contribution contracts with public housing

2 agencies to provide tenant-based assistance under

3 section 8 of the United States Housing Act of 1937

4 to all low-income families who are otherwise eligible

5 for assistance, in accordance with the requirements

6 of subparagraph (A), (B), or (D) of paragraph (1),

7 on the date that the project is acquired by the pur8 chaser. The Secretary shall take action under this

9 paragraph only after making a determination that

10 there is an adequate supply of habitable housing in

11 the area that is available to and affordable by low12 income families using such assistance. With respect

13 to subsidized or formerly subsidized projects, actions

14 may be taken pursuant to this paragraph in connec15 tion with not more than 10 percent of the aggregate

16 number of units in subsidized or formerly subsidized

17 projects disposed of by the Secretary in each fiscal

18 year.

19 ‘‘(3) OTHER ASSISTANCE.—

20 ‘‘(A) IN GENERAL.—In accordance with

21 the authority provided under the National

22 Housing Act, reduce the selling price, apply use

23 or rent restrictions on certain units, or provide

24 other financial assistance to the owners of mul25 tifamily housing projects that are acquired by a
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1 purchaser other than the Secretary at fore2 closure, or after sale by the Secretary, on terms

3 that will ensure that at least those units other4 wise required to receive project-based section 8

5 assistance pursuant to subparagraph (A), (B),

6 or (D) of paragraph (1) are available to and af7 fordable by low-income persons for the remain8 ing useful life of the project, as defined by the

9 Secretary.

10 ‘‘(B) DEFINITION.—A unit shall be consid11 ered affordable under this paragraph if—

12 ‘‘(i) for very low-income tenants, the

13 rent for such unit does not exceed 30 per14 cent of 50 percent of the area median in15 come, as determined by the Secretary, with

16 adjustments for family size; and

17 ‘‘(ii) for low-income tenants other

18 than very low-income tenants, the rent for

19 such unit does not exceed 30 percent of 80

20 percent of the area median income, as de21 termined by the Secretary, with adjust22 ments for family size.

23 ‘‘(C) VERY LOW-INCOME TENANTS.—The

24 Secretary shall provide assistance under section

25 8 of the United States Housing Act of 1937 to
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1 any very low-income tenant currently residing

2 in a unit otherwise required to receive project3 based rental assistance under section 8, pursu4 ant to subparagraph (A), (B), or (D) of para5 graph (1), if the rents charged such tenants as

6 a result of actions taken pursuant to this para7 graph exceed the amount payable as rent under

8 section 3(a) of the United States Housing Act

9 of 1937.

10 ‘‘(4) TRANSFER FOR USE UNDER OTHER PRO11 GRAMS OF THE SECRETARY.—

12 ‘‘(A) IN GENERAL.—Enter into an agree13 ment providing for the transfer of a multifamily

14 housing project—

15 ‘‘(i) to a public housing agency for use

16 of the project as public housing; or

17 ‘‘(ii) to an owner or another appro18 priate entity for use of the project under

19 section 202 of the Housing Act of 1959 or

20 under section 811 of the Cranston-Gon21 zalez National Affordable Housing Act.

22 ‘‘(B) REQUIREMENTS FOR AGREEMENT.—

23 The agreement described in subparagraph (A)

24 shall—
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1 ‘‘(i) contain such terms, conditions,

2 and limitations as the Secretary deter3 mines appropriate, including requirements

4 to assure use of the project under the pub5 lic housing, section 202, and section 811

6 programs; and

7 ‘‘(ii) ensure that no current tenant

8 will be displaced as a result of actions

9 taken under this paragraph.

10 ‘‘(f) OTHER ASSISTANCE.—In addition to the actions

11 required by subsection (e), the Secretary may take any

12 of the following actions:

13 ‘‘(1) SHORT-TERM LOANS.—Provide short-term

14 loans to facilitate the sale of multifamily housing

15 projects to nonprofit organizations or to public agen16 cies if—

17 ‘‘(A) authority for such loans is provided

18 in advance in an appropriations Act;

19 ‘‘(B) such loans are for a term of not more

20 than 5 years;

21 ‘‘(C) the Secretary is presented with satis22 factory documentation, evidencing a commit23 ment of permanent financing to replace such

24 short-term loan, from a lender who meets

25 standards set forth by the Secretary; and
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1 ‘‘(D) the terms of such loans are consist2 ent with prevailing practices in the marketplace

3 or the provision of such loans results in no cost

4 to the Government, as defined in section 502 of

5 the Congressional Budget Act.

6 ‘‘(2) TENANT-BASED ASSISTANCE.—Make avail7 able tenant-based assistance under section 8 of the

8 United States Housing Act of 1937 to very low-in9 come families that do not otherwise qualify for

10 project-based rental assistance.

11 ‘‘(3) ALTERNATIVE USES.—

12 ‘‘(A) IN GENERAL.—Notwithstanding any

13 other provision of law, and subject to notice to

14 and comment from existing tenants, allow not

15 more than—

16 ‘‘(i) 5 percent of the total number of

17 units in multifamily housing projects that

18 are disposed of by the Secretary during

19 each fiscal year to be made available for

20 uses other than rental or cooperative hous21 ing, including low-income homeownership

22 opportunities, community space, office

23 space for tenant or housing-related service

24 providers or security programs, or small
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1 business uses, if such uses benefit the ten2 ants of the project; and

3 ‘‘(ii) 5 percent of the total number of

4 units in multifamily housing projects that

5 are disposed of by the Secretary during

6 each fiscal year to be used in any manner,

7 if the Secretary and the unit of general

8 local government or area-wide governing

9 body determine that such use will further

10 fair housing, community development, or

11 neighborhood revitalization goals.

12 ‘‘(B) DISPLACEMENT PROTECTION.—The

13 Secretary shall—

14 ‘‘(i) make available tenant-based as15 sistance under section 8 of the United

16 States Housing Act of 1937 to any tenant

17 displaced as a result of actions taken by

18 the Secretary pursuant to subparagraph

19 (A); and

20 ‘‘(ii) take such actions as the Sec21 retary determines necessary to ensure the

22 successful use of any tenant-based assist23 ance provided under this subparagraph.

24 ‘‘(4) AUTHORIZATION OF USE OR RENT RE25 STRICTIONS IN UNSUBSIDIZED PROJECTS.—In carry-
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1 ing out the goals specified in subsection (a), the Sec2 retary may require certain units in unsubsidized

3 projects upon disposition to contain use or rent re4 strictions providing that such units will be available

5 to and affordable by very low-income persons for the

6 remaining useful life of the property, as defined by

7 the Secretary.

8 ‘‘(g) CONTRACT REQUIREMENTS.—

9 ‘‘(1) CONTRACT TERM.—

10 ‘‘(A) IN GENERAL.—Contracts for project11 based rental assistance under section 8 of the

12 United States Housing Act of 1937 provided

13 pursuant to this section shall be for a term of

14 not more than 15 years; and

15 ‘‘(B) CONTRACT TERM OF LESS THAN 15

16 YEARS.—To the extent that units receive

17 project-based rental assistance for a contract

18 term of less than 15 years, the Secretary shall

19 require that rents charged to tenants for such

20 units shall not exceed the amount payable for

21 rent under section 3(a) of the United States

22 Housing Act of 1937 for a period of at least 15

23 years.

24 ‘‘(2) CONTRACT RENT.—
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1 ‘‘(A) IN GENERAL.—The Secretary shall

2 set contract rents for section 8 project-based

3 rental contracts issued under this section at lev4 els that, in conjunction with other resources

5 available to the purchaser, provide for the nec6 essary costs of rehabilitation of such project

7 and do not exceed the percentage of the existing

8 housing fair market rents for the area, as de9 termined by the Secretary under section 8(c) of

10 the United States Housing Act of 1937.

11 ‘‘(B) UP-FRONT GRANTS.—If such an ap12 proach is determined to be more cost-effective,

13 the Secretary may utilize the budget authority

14 provided for project-based section 8 contracts

15 issued under this section to

16 ‘‘(i) provide project-based section 8

17 rental assistance; and

18 ‘‘(ii) provide up-front grants for the

19 necessary costs of rehabilitation.

20 ‘‘(h) DISPOSITION PLAN.—

21 ‘‘(1) IN GENERAL.—Prior to the sale of a mul22 tifamily housing project that is owned by the Sec23 retary, the Secretary shall develop a disposition plan

24 for the project that specifies the minimum terms

25 and conditions of the Secretary for disposition of the
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1 project, the initial sales price that is acceptable to

2 the Secretary, and the assistance that the Secretary

3 plans to make available to a prospective purchaser

4 in accordance with this section. The initial sales

5 price shall reflect the intended use of the property

6 after sale.

7 ‘‘(2) COMMUNITY AND TENANT INPUT INTO

8 DISPOSITION PLANS AND SALES.—

9 ‘‘(A) IN GENERAL.—In carrying out this

10 section, the Secretary shall develop procedures

11 to obtain appropriate and timely input into dis12 position plans from officials of the unit of gen13 eral local government affected, the community

14 in which the project is situated, and the tenants

15 of the project.

16 ‘‘(B) TENANT ORGANIZATIONS.—The Sec17 retary shall develop procedures to facilitate,

18 where feasible and appropriate, the sale of mul19 tifamily housing projects to existing tenant or20 ganizations with demonstrated capacity or to

21 public or nonprofit entities that represent or

22 are affiliated with existing tenant organizations.

23 ‘‘(C) TECHNICAL ASSISTANCE.—

24 ‘‘(i) IN GENERAL.—To carry out the

25 procedures developed under subparagraphs
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1 (A) and (B), the Secretary is authorized to

2 provide technical assistance, directly or in3 directly.

4 ‘‘(ii) TECHNICAL ASSISTANCE PROVID5 ERS.—Recipients of technical assistance

6 funding under the Emergency Low Income

7 Housing Preservation Act of 1987, the

8 Low-Income Housing Preservation and

9 Resident Homeownership Act of 1990,

10 subtitle B of title IV of the Cranston-Gon11 zalez National Affordable Housing Act,

12 shall be permitted to provide technical as13 sistance to the extent of such funding

14 under any of such programs or under this

15 section, notwithstanding the source of

16 funding.

17 ‘‘(iii) AUTHORIZATION OF APPROPRIA18 TIONS.—There are authorized to be appro19 priated $5,000,000 to carry out this sub20 paragraph. In addition, the Secretary is

21 authorized to use amounts appropriated

22 for technical assistance under the Emer23 gency Low Income Housing Preservation

24 Act of 1987, the Low-Income Housing

25 Preservation and Resident Homeownership
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1 Act of 1990, subtitle B of title IV of the

2 Cranston-Gonzalez National Affordable

3 Housing Act, for the provision of technical

4 assistance under this section.

5 ‘‘(i) RIGHT OF FIRST REFUSAL.—

6 ‘‘(1) PROCEDURE.—

7 ‘‘(A) NOTIFICATION BY SECRETARY OF

8 THE ACQUISITION OF TITLE.—Not later than

9 30 days after the Secretary acquires title to a

10 multifamily housing project, the Secretary shall

11 notify the appropriate unit of general local gov12 ernment and State agency or agencies des13 ignated by the Governor of the acquisition of

14 such title.

15 ‘‘(B) EXPRESSION OF INTEREST.—Not

16 later than 45 days after receiving notification

17 from the Secretary under subparagraph (A),

18 the unit of general local government or des19 ignated State agency may submit to the Sec20 retary a preliminary expression of interest in

21 the project. The Secretary may take such ac22 tions as may be necessary to require the unit of

23 general local government or designated State

24 agency to substantiate such interest.
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1 ‘‘(C) TIMELY EXPRESSION OF INTER2 EST.—If the unit of general local government or

3 designated State agency has expressed interest

4 in the project before the expiration of the 45-

5 day period referred to in subparagraph (B) and

6 has substantiated such interest if requested, the

7 Secretary shall notify the unit of general local

8 government or designated State agency, within

9 a reasonable period of time, of the terms and

10 conditions of the disposition plan, in accordance

11 with subsection (h). The Secretary shall then

12 give the unit of general local government or

13 designated State agency not more than 90 days

14 after the date of such notification to make an

15 offer to purchase the project.

16 ‘‘(D) NO TIMELY EXPRESSION OF INTER17 EST.—If the unit of general local government or

18 designated State agency does not express inter19 est before the expiration of the 45-day period

20 referred to in subparagraph (B), or does not

21 substantiate an expressed interest if requested,

22 the Secretary may offer the project for sale to

23 any interested person or entity.

24 ‘‘(2) ACCEPTANCE OF OFFERS.—If the Sec25 retary has given the unit of general local government
30

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1 or designated State agency 90 days to make an offer

2 to purchase the project, the Secretary shall accept

3 an offer that complies with the terms and conditions

4 of the disposition plan. The Secretary may accept an

5 offer that does not comply with the terms and condi6 tions of the disposition plan if the Secretary deter7 mines that the offer will further the goals specified

8 in subsection (a) by actions that include extension of

9 the duration of low-income affordability restrictions

10 or otherwise restructuring the transaction in a man11 ner that enhances the long-term affordability for

12 low-income persons. The Secretary shall, in particu13 lar, have discretion to reduce the initial sales price

14 in exchange for the extension of low-income afford15 ability restrictions beyond the period of assistance

16 contemplated by the attachment of assistance pursu17 ant to subsection (e) or for an increase in the num18 ber of units that are available to and affordable by

19 low-income families. If the Secretary and the unit of

20 general local government or designated State agency

21 cannot reach agreement within 90 days, the Sec22 retary may offer the project for sale to the general

23 public.

24 ‘‘(3) PURCHASE BY UNIT OF GENERAL LOCAL

25 GOVERNMENT OR DESIGNATED STATE AGENCY.—
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•S 1299 ES

1 Notwithstanding any other provision of law, a unit

2 of general local government (including a public hous3 ing agency) or designated State agency may pur4 chase multifamily housing projects in accordance

5 with this subsection.

6 ‘‘(4) APPLICABILITY.—This subsection shall

7 apply to projects that are acquired on or after the

8 effective date of this subsection. With respect to

9 projects acquired before such effective date, the Sec10 retary may apply—

11 ‘‘(A) the requirements of paragraphs (2)

12 and (3) of section 203(e) as such paragraphs

13 existed immediately before the effective date of

14 this subsection; or

15 ‘‘(B) the requirements of paragraphs (1)

16 and (2) of this subsection, if the Secretary gives

17 the unit of general local government or des18 ignated State agency—

19 ‘‘(i) 45 days to express interest in the

20 project; and

21 ‘‘(ii) if the unit of general local gov22 ernment or designated State agency ex23 presses interest in the project before the

24 expiration of the 45-day period, and sub25 stantiates such interest if requested, 90
32

•S 1299 ES

1 days from the date of notification of the

2 terms and conditions of the disposition

3 plan to make an offer to purchase the

4 project.

5 ‘‘(j) DISPLACEMENT OF TENANTS AND RELOCATION

6 ASSISTANCE.—

7 ‘‘(1) IN GENERAL.—Whenever tenants will be

8 displaced as a result of the demolition of, repairs to,

9 or conversion in the use of, a multifamily housing

10 project that is owned by the Secretary (or for which

11 the Secretary is mortgagee in possession), the Sec12 retary shall identify tenants who will be displaced,

13 and shall notify all such tenants of their pending

14 displacement and of any relocation assistance that

15 may be available. In the case of a multifamily hous16 ing project that is subject to a mortgage held by the

17 Secretary, the Secretary shall require the owner of

18 the project to carry out the requirements of this

19 paragraph, if the Secretary has authorized the dem20 olition of, repairs to, or conversion in the use of such

21 multifamily housing project.

22 ‘‘(2) RIGHTS OF DISPLACED TENANTS.—The

23 Secretary shall assure for any such tenant (who con24 tinues to meet applicable qualification standards)

25 the right—
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•S 1299 ES

1 ‘‘(A) to return, whenever possible, to a re2 paired unit;

3 ‘‘(B) to occupy a unit in another multifam4 ily housing project owned by the Secretary;

5 ‘‘(C) to obtain housing assistance under

6 the United States Housing Act of 1937; or

7 ‘‘(D) to receive any other available reloca8 tion assistance as the Secretary determines to

9 be appropriate.

10 ‘‘(k) MORTGAGE AND PROJECT SALES.—

11 ‘‘(1) IN GENERAL.—The Secretary may not ap12 prove the sale of any loan or mortgage held by the

13 Secretary (including any loan or mortgage owned by

14 the Government National Mortgage Association) on

15 any subsidized project or formerly subsidized

16 project, unless such sale is made as part of a trans17 action that will ensure that such project will con18 tinue to operate at least until the maturity date of

19 such loan or mortgage, in a manner that will provide

20 rental housing on terms at least as advantageous to

21 existing and future tenants as the terms required by

22 the program under which the loan or mortgage was

23 made or insured prior to the assignment of the loan

24 or mortgage on such project to the Secretary.
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•S 1299 ES

1 ‘‘(2) SALE OF CERTAIN PROJECTS.—The Sec2 retary may not approve the sale of any subsidized

3 project—

4 ‘‘(A) that is subject to a mortgage held by

5 the Secretary; or

6 ‘‘(B) if the sale transaction involves the

7 provision of any additional subsidy funds by the

8 Secretary or a recasting of the mortgage;

9 unless such sale is made as part of a transaction

10 that will ensure that such project will continue to

11 operate at least until the maturity date of the loan

12 or mortgage, in a manner that will provide rental

13 housing on terms at least as advantageous to exist14 ing and future tenants as the terms required by the

15 program under which the loan or mortgage was

16 made or insured prior to the proposed sale of the

17 project.

18 ‘‘(3) MORTGAGE SALES TO STATE AND LOCAL

19 GOVERNMENTS.—Notwithstanding any provision of

20 law that may require competitive sales or bidding,

21 the Secretary may carry out negotiated sales of

22 mortgages held by the Secretary that are secured by

23 subsidized, unsubsidized, or formerly subsidized mul24 tifamily housing projects, without the competitive se25 lection of purchasers or intermediaries, to units of
35

•S 1299 ES

1 general local government or State agencies, or

2 groups of investors that include at least 1 such unit

3 of general local government or State agency, if the

4 negotiations are conducted with such agencies, ex5 cept that—

6 ‘‘(A) the terms of any such sale shall in7 clude the agreement of the purchasing agency

8 or unit of local government or State agency to

9 act as mortgagee or owner of a beneficial inter10 est in such mortgages, in a manner consistent

11 with maintaining the projects that are subject

12 to such mortgages for occupancy by the general

13 tenant group intended to be served by the appli14 cable mortgage insurance program, including,

15 to the extent the Secretary determines appro16 priate, authorizing such unit of local govern17 ment or State agency to enforce the provisions

18 of any regulatory agreement or other program

19 requirements applicable to the related projects;

20 and

21 ‘‘(B) the sales prices for such mortgages

22 shall be, in the determination of the Secretary,

23 the best prices that may be obtained for such

24 mortgages from a unit of general local govern25 ment or State agency, consistent with the ex-
36

•S 1299 ES

1 pectation and intention that the projects fi2 nanced will be retained for use under the appli3 cable mortgage insurance program for the life

4 of the initial mortgage insurance contract.

5 ‘‘(4) SALE OF MORTGAGES COVERING

6 UNSUBSIDIZED PROJECTS.—Notwithstanding any

7 other provision of law, the Secretary may sell mort8 gages held on unsubsidized projects on such terms

9 and conditions as the Secretary may prescribe.

10 ‘‘(l) PROJECT-BASED RENTAL ASSISTANCE FOR

11 TERM OF LESS THAN 15 YEARS.—Notwithstanding sub12 section (g), project-based rental assistance in connection

13 with the disposition of a multifamily housing project may

14 be provided for a contract term of less than 15 years if

15 such assistance is provided—

16 ‘‘(1) under a contract authorized under section

17 6 of the HUD Demonstration Act of 1993; and

18 ‘‘(2) pursuant to a disposition plan under this

19 section for a project that is determined by the Sec20 retary to be otherwise in compliance with this sec21 tion.

22 ‘‘(m) REPORT TO CONGRESS.—Not later than June

23 1 of each year, the Secretary shall submit to the Commit24 tee on Banking, Housing, and Urban Affairs of the Senate

25 and the Committee on Banking, Finance and Urban Af-
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•S 1299 ES

1 fairs of the House of Representatives, a report describing

2 the status of multifamily housing projects owned by or

3 subject to mortgages held by the Secretary, on an aggre4 gate basis, which highlights the differences, if any, be5 tween the subsidized and the unsubsidized inventory. The

6 report shall include—

7 ‘‘(1) the average and median size of the

8 projects;

9 ‘‘(2) the geographic locations of the projects, by

10 State and region;

11 ‘‘(3) the years during which projects were as12 signed to the Department, and the average and me13 dian length of time that projects remain in the

14 HUD-held inventory;

15 ‘‘(4) the status of HUD-held mortgages;

16 ‘‘(5) the physical condition of the HUD-held

17 and HUD-owned inventory;

18 ‘‘(6) the occupancy profile of the projects, in19 cluding the income, family size, race, and ethnic ori20 gin of current tenants, and the rents paid by such

21 tenants;

22 ‘‘(7) the proportion of units that are vacant;

23 ‘‘(8) the number of projects for which the Sec24 retary is mortgagee in possession;
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•S 1299 ES

1 ‘‘(9) the number of projects sold in foreclosure

2 sales;

3 ‘‘(10) the number of HUD-owned projects sold;

4 ‘‘(11) a description of actions undertaken pur5 suant to this section, including—

6 ‘‘(A) a comparison of results between ac7 tions taken after the date of enactment of the

8 Housing and Community Development Act of

9 1993 and actions taken in the years preceding

10 such date of enactment;

11 ‘‘(B) a description of any impediments to

12 the disposition or management of multifamily

13 housing projects, together with a recommenda14 tion of proposed legislative or regulatory

15 changes designed to ameliorate such impedi16 ments;

17 ‘‘(C) a description of actions taken to re18 structure or commence foreclosure on delin19 quent multifamily mortgages held by the De20 partment; and

21 ‘‘(D) a description of actions taken to

22 monitor and prevent the default of multifamily

23 housing mortgages held by the Federal Housing

24 Administration;
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•S 1299 ES

1 ‘‘(12) a description of any of the functions per2 formed in connection with this section that are con3 tracted out to public or private entities or to States,

4 including—

5 ‘‘(A) the costs associated with such delega6 tion;

7 ‘‘(B) the implications of contracting out or

8 delegating such functions for current Depart9 ment field or regional personnel, including an10 ticipated personnel or work load reductions;

11 ‘‘(C) necessary oversight required by De12 partment personnel, including anticipated per13 sonnel hours devoted to such oversight;

14 ‘‘(D) a description of any authority grant15 ed to such public or private entities or States

16 in conjunction with the functions that have

17 been delegated or contracted out or that are not

18 otherwise available for use by Department per19 sonnel; and

20 ‘‘(E) the extent to which such public or

21 private entities or States include tenants of

22 multifamily housing projects in the disposition

23 planning for such projects; and

24 ‘‘(13) a description of the activities carried out

25 under subsection (i) during the preceding year.’’.
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1 (c) EFFECTIVE DATE.—The Secretary shall, by no2 tice published in the Federal Register, which shall take

3 effect upon publication, establish such requirements as

4 may be necessary to implement the amendments made by

5 this section. The notice shall invite public comments and,

6 not later than 12 months after the date on which the no7 tice is published, the Secretary shall issue final regulations

8 based on the initial notice, taking into account any public

9 comments received.

10 SEC. 102. REPEAL OF STATE AGENCY MULTIFAMILY PROP11 ERTY DISPOSITION DEMONSTRATION.

12 Section 184 of the Housing and Community Develop13 ment Act of 1987 (12 U.S.C. 1701z–11 note) is hereby

14 repealed.

15 SEC. 103. RTC MARKETING AND DISPOSITION OF MULTI16 FAMILY PROJECTS OWNED BY HUD.

17 (a) AUTHORIZATION.—The Secretary may carry out

18 a demonstration with not more than 50 unsubsidized mul19 tifamily housing projects owned by the Secretary, using

20 the RTC for the marketing and disposition of the projects.

21 Any such demonstration shall be carried out pursuant to

22 an agreement between the RTC and the Secretary on such

23 terms and conditions as are acceptable to the RTC and

24 the Secretary. The RTC shall establish policies and proce-
41

•S 1299 ES

1 dures for marketing and disposition, subject to review and

2 approval by the Secretary.

3 (b) RULES GOVERNING THE DEMONSTRATION.—

4 (1) IN GENERAL.—Except as provided in para5 graph (2), in carrying out the provisions of this sec6 tion, the RTC shall dispose of unsubsidized multi7 family housing projects pursuant to the provisions of

8 section 21A(c) of the Federal Home Loan Bank Act.

9 (2) EXCEPTION.—Notwithstanding paragraph

10 (1), a very low-income tenant currently residing in

11 a unit otherwise required under subsection (e)(1)(D)

12 of section 203 of the Housing and Community De13 velopment Amendments of 1978 to receive project14 based rental assistance under section 8, shall upon

15 disposition pay not more than the amount payable

16 as rent under section 3(a) of the United States

17 Housing Act of 1937.

18 (c) DETERMINATION OF PROJECTS INCLUDED.—In

19 determining which projects to include in the demonstra20 tion, the Secretary and the RTC shall take into consider21 ation—

22 (1) the prior experience of the RTC in dispos23 ing of other multifamily housing projects in the ju24 risdictions in which such projects are located; and
42

•S 1299 ES

1 (2) such other factors as the Secretary and the

2 RTC determine to be appropriate.

3 (d) REIMBURSEMENT.—The agreement entered into

4 pursuant to subsection (a) shall provide that the Secretary

5 shall reimburse the RTC for the direct costs associated

6 with the demonstration, including the costs of administra7 tion and marketing, property management, and any repair

8 and rehabilitation. The Secretary may use proceeds from

9 the sale of the projects to reimburse the RTC for its costs.

10 (e) REPORTS.—

11 (1) ANNUAL REPORTS.—The Secretary and the

12 RTC shall jointly submit an annual report to the

13 Committee on Banking, Housing, and Urban Affairs

14 of the Senate and the Committee on Banking, Fi15 nance and Urban Affairs of the House of Represent16 atives detailing the progress of the demonstration.

17 (2) FINAL REPORT.—Not later than 3 months

18 after the completion of the demonstration, the Sec19 retary shall submit to the Committee on Banking,

20 Housing, and Urban Affairs of the Senate and the

21 Committee on Banking, Finance and Urban Affairs

22 of the House of Representatives a report describing

23 the results of the demonstration and any rec24 ommendations for legislative action.
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1 (f) TERMINATION.—The demonstration under this

2 section shall not extend beyond the termination date of

3 the RTC.

4 SEC. 104. CIVIL MONEY PENALTIES AGAINST GENERAL

5 PARTNERS AND CERTAIN MANAGING AGENTS

6 OF MULTIFAMILY HOUSING PROJECTS.

7 (a) CIVIL MONEY PENALTIES AGAINST MULTIFAM8 ILY MORTGAGORS.—Section 537 of the National Housing

9 Act (12 U.S.C. 1735f–15) is amended—

10 (1) in subsection (b)(1), by inserting after

11 ‘‘mortgagor’’ the second place it appears the follow12 ing: ‘‘or general partner of a partnership mortga13 gor’’;

14 (2) in subsection (c)—

15 (A) by striking the heading and inserting

16 the following:

17 ‘‘(c) OTHER VIOLATIONS.—’’; and

18 (B) in paragraph (1)—

19 (i) by striking ‘‘The Secretary may’’

20 and all that follows through the colon and

21 inserting the following:

22 ‘‘(A) LIABLE PARTIES.—The Secretary

23 may also impose a civil money penalty under

24 this section on—
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•S 1299 ES

1 ‘‘(i) any mortgagor of a property that

2 includes 5 or more living units and that

3 has a mortgage insured, coinsured, or held

4 pursuant to this Act;

5 ‘‘(ii) the general partner of a partner6 ship mortgagor of such property; or

7 ‘‘(iii) any agent employed to manage

8 the property that has an identity of inter9 est with the mortgagor or the general part10 ner of a partnership mortgagor of such

11 property.

12 ‘‘(B) VIOLATIONS.—A penalty may be im13 posed under this paragraph for knowingly and

14 materially taking any of the following actions:’’;

15 (ii) in subparagraph (B), as redesig16 nated, by redesignating subparagraphs (A)

17 through (L) as clauses (i) through (xii), re18 spectively; and

19 (iii) by adding after clause (xii), as re20 designated, the following new clauses:

21 ‘‘(xiii) Failure to maintain the prem22 ises, accommodations, and the grounds and

23 equipment appurtenant thereto in good re24 pair and condition in accordance with reg25 ulations and requirements of the Secretary,
45

•S 1299 ES

1 except that nothing in this clause shall

2 have the effect of altering the provisions of

3 an existing regulatory agreement or feder4 ally insured mortgage on the property.

5 ‘‘(xiv) Failure, by a mortgagor or gen6 eral partner of a partnership mortgagor, to

7 provide management for the project that is

8 acceptable to the Secretary pursuant to

9 regulations and requirements of the Sec10 retary.’’; and

11 (iv) in the last sentence, by deleting

12 ‘‘of such agreement’’ and inserting ‘‘of this

13 subsection’’;

14 (3) in subsection (d)(1)(B), by inserting after

15 ‘‘mortgagor’’ the following: ‘‘, general partner of a

16 partnership mortgagor, or identity of interest agent

17 employed to manage the property,’’;

18 (4) in subsection (d), by adding at the end the

19 following new paragraph:

20 ‘‘(5) PAYMENT OF PENALTY.—No payment of a

21 civil money penalty levied under this section shall be

22 payable out of project income.’’;

23 (5) in subsection (e)(1), by deleting ‘‘a mortga24 gor’’ and inserting ‘‘an entity or person’’;
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•S 1299 ES

1 (6) in subsection (f), by inserting after ‘‘mort2 gagor’’ each place such term appears the following:

3 ‘‘, general partner of a partnership mortgagor, or

4 identity of interest agent employed to manage the

5 property,’’;

6 (7) by striking the heading of subsection (f)

7 and inserting the following: ‘‘CIVIL MONEY PEN8 ALTIES AGAINST MULTIFAMILY MORTGAGORS, GEN9 ERAL PARTNERS OF PARTNERSHIP MORTGAGORS,

10 AND CERTAIN MANAGING AGENTS’’;

11 (8) in subsection (j), by striking ‘‘all civil

12 money’’ and all that follows through the period at

13 the end and inserting the following: ‘‘the Secretary

14 shall apply all civil money penalties collected under

15 this section, or any portion of such penalties, to the

16 fund established under section 201(j) of the Housing

17 and Community Development Amendments of

18 1978.’’; and

19 (9) by adding at the end the following new sub20 section:

21 ‘‘(k) IDENTITY OF INTEREST MANAGING AGENT.—

22 For purposes of this section, the term ‘identity of interest

23 managing agent’ means an ownership entity, or its general

24 partner or partners, which has an ownership interest in
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•S 1299 ES

1 and which exerts effective control over the property’s own2 ership.’’.

3 (b) IMPLEMENTATION.—The Secretary shall imple4 ment the amendments made by this section by regulation

5 issued after notice and opportunity for public comment.

6 A proposed rule shall be published not later than March

7 1, 1994. The notice shall seek comments primarily as to

8 the definition of the terms ‘ownership interest in’ and ‘ef9 fective control’, as such terms are used in the definition

10 of identity of interest managing agent.

11 (c) APPLICABILITY OF AMENDMENTS.—The amend12 ments made by subsection (a) shall apply only with respect

13 to—

14 (1) violations that occur on or after the effec15 tive date of the final regulations implementing the

16 amendments made by this section; and

17 (2) in the case of a continuing violation (as de18 termined by the Secretary), any portion of a viola19 tion that occurs on or after such date.

20 SEC. 105. MODELS FOR PROPERTY DISPOSITION.

21 The Federal Housing Commissioner shall develop

22 models which shall be designed to assist States and units

23 of general local government in using other Federal pro24 grams for the purpose of acquiring, rehabilitating, or oth25 erwise participating in—
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1 (1) the disposition, pursuant to section 203 of

2 the Housing and Community Development Amend3 ments of 1978, of multifamily housing projects

4 owned by the Secretary; or

5 (2) the sale, pursuant to section 203 of the

6 Housing and Community Development Amendments

7 of 1978, of multifamily housing projects subject to

8 mortgages held by the Secretary.

9 SEC. 106. PREVENTING MORTGAGE DEFAULTS.

10 (a) MULTIFAMILY HOUSING PLANNING AND INVEST11 MENT STRATEGIES.—

12 (1) PREPARATION OF ASSESSMENTS FOR INDE13 PENDENT ENTITIES.—Section 402(a) of the Housing

14 and Community Development Act of 1992 (12

15 U.S.C. 1715–1a note) is amended by adding at the

16 end the following: ‘‘The assessment shall be pre17 pared by an entity that does not have an identity of

18 interest with the owner.’’.

19 (2) TIMING OF SUBMISSION OF NEEDS ASSESS20 MENTS.—Section 402(b) of the Housing and Com21 munity Development Act of 1992 (12 U.S.C. 17152–

22 1a note) is amended to read as follows:

23 ‘‘(b) TIMING.—To ensure that assessments for all

24 covered multifamily housing properties will be submitted

25 on or before the conclusion of fiscal year 1997, the Sec-
49

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1 retary shall require the owners of such properties, includ2 ing covered multifamily housing properties for the elderly,

3 to submit the assessments for the properties in accordance

4 with the following schedule:

5 ‘‘(1) For fiscal year 1994, 10 percent of the ag6 gregate number of such properties.

7 ‘‘(2) For each of fiscal years 1995, 1996, and

8 1997, an additional 30 percent of the aggregate

9 number of such properties.’’.

10 (3) REVIEW OF COMPREHENSIVE NEEDS AS11 SESSMENTS.—Section 404(d) of the Housing and

12 Community Development Act of 1992 (12 U.S.C.

13 1715–1a note) is amended to read as follows:

14 ‘‘(d) REVIEW.—

15 ‘‘(1) IN GENERAL.—The Secretary shall review

16 each comprehensive needs assessment for complete17 ness and adequacy before the expiration of the 90-

18 day period beginning on the receipt of the assess19 ment.

20 ‘‘(2) INCOMPLETE OR INADEQUATE ASSESS21 MENTS.—If the Secretary determines that the as22 sessment is substantially incomplete or inadequate,

23 the Secretary shall—
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•S 1299 ES

1 ‘‘(A) provide the owner with a reasonable

2 amount of time to resubmit an amended assess3 ment; and

4 ‘‘(B) indicate to the owner the portion of

5 the original assessment requiring completion or

6 other revision.’’.

7 (4) REPEAL OF NOTICE PROVISION.—Section

8 404(f) of the Housing and Community Development

9 Act of 1992 (12 U.S.C. 1715–1a note) is hereby re10 pealed.

11 (5) FUNDING.—Title IV of the Housing and

12 Community Development Act of 1992 (12 U.S.C.

13 1715z–1a note) is amended by adding at the end the

14 following new section:

15 ‘‘SEC. 409. FUNDING.

16 ‘‘(a) ALLOCATION OF ASSISTANCE.—Based upon

17 needs identified in comprehensive needs assessments, and

18 subject to otherwise applicable program requirements, in19 cluding selection criteria, the Secretary may allocate the

20 following assistance to owners of covered multifamily

21 housing projects and may provide such assistance on a

22 noncompetitive basis:

23 ‘‘(1) Operating assistance and capital improve24 ment assistance for troubled multifamily housing

25 projects pursuant to section 201 of the Housing and
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1 Community Development Amendments of 1978, ex2 cept for assistance set aside under section 201(n)(1).

3 ‘‘(2) Loan management assistance available

4 pursuant to section 8 of the United States Housing

5 Act of 1937.

6 ‘‘(b) OPERATING ASSISTANCE AND CAPITAL IM7 PROVEMENT ASSISTANCE.—In providing assistance under

8 subsection (a) the Secretary shall use the selection criteria

9 set forth in section 201(n) of the Housing and Community

10 Development Amendments.

11 ‘‘(c) AMOUNT OF ASSISTANCE.—The Secretary may

12 fund all or only a portion of the needs identified in the

13 capital needs assessment of an owner selected to receive

14 assistance under this section.’’.

15 (b) FLEXIBLE SUBSIDY PROGRAM.—

16 (1) DELETION OF UTILITY COST REQUIRE17 MENTS.—Section 201(i) of the Housing and Com18 munity Development Amendments of 1978 (12

19 U.S.C. 1715z–1a(i)) is hereby repealed.

20 (2) REPEAL OF MANDATORY CONTRIBUTION

21 FROM OWNER.—Section 201(k)(2) of the Housing

22 and Community Development Amendments of 1978

23 (12 U.S.C. 1715z–1a(k)(2)) is amended by striking

24 ‘‘, except that’’ and all that follows through ‘‘such

25 loan’’.
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1 (3) FUNDING.—Section 201(n) of the Housing

2 and Community Development Amendments of 1978

3 (42 U.S.C. 1715z–1a(n)) is amended to read as fol4 lows:

5 ‘‘(n)(1) For fiscal year 1994 only, in providing, and

6 contracting to provide, assistance for capital improve7 ments under this section, the Secretary shall set aside an

8 amount, as determined by the Secretary, for projects that

9 are eligible for incentives under section 224(b) of the

10 Emergency Low Income Housing Preservation Act of

11 1987, as such section existed before the date of enactment

12 of the Cranston-Gonzalez National Affordable Housing

13 Act. The Secretary may make such assistance available

14 on a noncompetitive basis.

15 ‘‘(2) Except as provided in paragraph (3), with re16 spect to assistance under this section not set aside for

17 projects under paragraph (1), the Secretary—

18 ‘‘(A) may award assistance on a noncompetitive

19 basis; and

20 ‘‘(B) shall award assistance to eligible projects

21 on the basis of—

22 ‘‘(i) the extent to which the project is

23 physically or financially troubled, as evidenced

24 by the comprehensive needs assessment submit-
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1 ted in accordance with title IV of the Housing

2 and Community Development Act of 1992; and

3 ‘‘(ii) the extent to which such assistance is

4 necessary and reasonable to prevent the default

5 of federally insured mortgages.

6 ‘‘(3) The Secretary may make exceptions to selection

7 criteria set forth in paragraph (2) to permit the provision

8 of assistance to eligible projects based upon—

9 ‘‘(A) the extent to which such assistance is nec10 essary to prevent the imminent foreclosure or de11 fault of a project whose owner has not submitted a

12 comprehensive needs assessment pursuant to title IV

13 of the Housing and Community Development Act of

14 1992;

15 ‘‘(B) the extent to which the project presents

16 an imminent threat to the life, health, and safety of

17 project residents; or

18 ‘‘(C) such other criteria as the Secretary may

19 specify by regulation or by notice printed in the Fed20 eral Register.

21 ‘‘(4) In providing assistance under this section, the

22 Secretary shall take into consideration—

23 ‘‘(A) the extent to which there is evidence that

24 there will be significant opportunities for residents

25 (including a resident council or resident manage-
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1 ment corporation, as appropriate) to be involved in

2 the management of the project (except that this

3 paragraph shall have no application to projects that

4 are owned as cooperatives); and

5 ‘‘(B) the extent to which there is evidence that

6 the project owner has provided competent manage7 ment and complied with all regulatory and adminis8 trative instructions (including such instructions with

9 respect to the comprehensive servicing of multifamily

10 projects as the Secretary may issue).’’.

11 (c) IMPLEMENTATION AND EFFECTIVE DATE FOR

12 SUBSECTIONS (a) AND (b).—

13 (1) IN GENERAL.—The Secretary shall, by no14 tice published in the Federal Register, which shall

15 take effect upon publication, establish such require16 ments as may be necessary to implement the amend17 ments made by subsections (a) and (b). The notice

18 shall invite public comments and, not later than 12

19 months after the date on which the notice is pub20 lished, the Secretary shall issue final regulations

21 based on the initial notice, taking into account any

22 public comments received.

23 (2) CONTENTS.—The notice and the regulations

24 shall describe the method by which the Secretary al25 locates assistance in accordance with section 409 of
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1 the Housing and Community Development Act of

2 1992 (as added by section 106(a) of this Act) and

3 paragraphs (2) and (3) of section 201(n) of the

4 Housing and Community Development Amendments

5 of 1978.

6 (3) ANNUAL PUBLICATIONS.—The Secretary

7 shall publish annually in the Federal Register—

8 (A) the method by which the Secretary de9 termines which capital needs assessments will

10 be received each year, in accordance with sec11 tions 402(b) and 404(d) of the Housing and

12 Community Development Act of 1992; and

13 (B) a list of all owners of covered multi14 family housing projects, by project, that have

15 received funding under—

16 (i) section 409 of the Housing and

17 Community Development Act of 1992 (as

18 added by section 106(a) of this Act); or

19 (ii) paragraphs (2) and (3) of section

20 201(n) of the Housing and Community

21 Development Amendments of 1978.

22 (4) EFFECTIVE DATE.—

23 (A) IN GENERAL.—Except as provided in

24 subparagraph (B), the amendments made by
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1 subsections (a) and (b) shall take effect for

2 amounts made available for fiscal year 1995.

3 (B) EXCEPTION.—Notwithstanding sub4 paragraph (A), section 201(n)(1) of the Hous5 ing and Community Development Amendments

6 of 1978 (as added by subsection (b)(3)) shall

7 take effect on the date of enactment of this Act.

8 (d) STREAMLINED REFINANCING.—As soon as prac9 ticable, the Secretary shall implement a streamlined refi10 nancing program under the authority provided in section

11 223 of the National Housing Act to prevent the default

12 of mortgages insured by the FHA which cover multifamily

13 housing projects, as defined in section 203(b) of the Hous14 ing and Community Development Amendments of 1978.

15 (e) PARTIAL PAYMENTS OF CLAIM.—

16 (1) IN GENERAL.—Notwithstanding any other

17 provision of law, if the Secretary is requested to ac18 cept assignment of a mortgage insured by the Sec19 retary that covers a multifamily housing project, as

20 such term is defined in section 203(b) of the Hous21 ing and Community Development Amendments of

22 1978, and the Secretary determines that partial pay23 ment would be less costly to the Federal Government

24 than other reasonable alternatives for maintaining

25 the low-income character of the project, the Sec-
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1 retary may request the mortgagee, in lieu of assign2 ment, to—

3 (A) accept partial payment of the claim

4 under the mortgage insurance contract; and

5 (B) recast the mortgage, under such terms

6 and conditions as the Secretary may determine.

7 (2) CONDITION.—As a condition to a partial

8 claim payment under this section, the mortgagor

9 shall agree to repay to the Secretary the amount of

10 such payment and such obligation shall be secured

11 by a second mortgage on the property on such terms

12 and conditions as the Secretary may determine.

13 (f) GAO STUDY ON PREVENTION OF DEFAULT.—

14 (1) IN GENERAL.—Not later than June 1,

15 1994, the Comptroller General of the United States

16 shall submit to the Committee on Banking, Housing,

17 and Urban Affairs of the Senate and the Committee

18 on Banking, Finance and Urban Affairs of the

19 House of Representatives a report that evaluates the

20 adequacy of loan loss reserves in the General Insur21 ance and Special Risk Insurance Funds and pre22 sents recommendations for the Secretary to prevent

23 losses from occurring.

24 (2) CONTENTS.—The report submitted under

25 paragraph (1) shall—
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1 (A) evaluate the factors considered in ar2 riving at loss estimates and determine whether

3 other factors should be considered;

4 (B) determine the relative benefit of creat5 ing a new, actuarially sound insurance fund for

6 all new multifamily housing insurance commit7 ments; and

8 (C) recommend alternatives to the Sec9 retary’s current procedures for preventing the

10 future default of multifamily housing project

11 mortgages insured under title II of the National

12 Housing Act.

13 (g) GAO STUDY ON ACTUARIAL SOUNDNESS OF

14 CERTAIN INSURANCE PROGRAMS.—

15 (1) IN GENERAL.—Not later than June 1,

16 1994, the Comptroller General of the United States

17 shall submit to the Committee on Banking, Housing,

18 and Urban Affairs of the Senate and the Committee

19 on Banking, Finance and Urban Affairs of the

20 House of Representatives a report that evaluates, in

21 connection with the General Insurance Fund, the

22 role and performance of the nursing home, hospital,

23 and retirement service center insurance programs.

24 (2) CONTENTS.—The reports submitted under

25 paragraph (1) shall—
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1 (A) evaluate the strategic importance of

2 these insurance programs to the mission of the

3 FHA;

4 (B) evaluate the impact of these insurance

5 programs upon the financial performance of the

6 General Insurance Fund;

7 (C) assess the potential losses expected

8 under these programs through fiscal year 1999;

9 (D) evaluate the risk of these programs to

10 the General Insurance Fund in connection with

11 changes in national health care policy;

12 (E) assess the ability of the FHA to man13 age these programs; and

14 (F) make recommendations for any nec15 essary changes.

16 (h) ANNUAL ACTUARIAL REVIEW.—

17 (1) SPECIAL RISK INSURANCE FUND.—Section

18 238(c) of the National Housing Act (12 U.S.C.

19 1715z–3(c)) is amended by adding at the end the

20 following new paragraph:

21 ‘‘(3) The Secretary shall undertake an annual

22 review of the actuarial soundness of each of the in23 surance programs comprising the Special Risk In24 surance Fund, and shall present findings from such
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1 review to the Congress in the FHA Annual Manage2 ment Report.’’.

3 (2) GENERAL INSURANCE FUND.—Section 519

4 of the National Housing Act (12 U.S.C. 1735c) is

5 amended by adding at the end the following new

6 subsection:

7 ‘‘(g) ANNUAL ACTUARIAL REVIEW.—The Secretary

8 shall undertake an annual review of the actuarial sound9 ness of each of the insurance programs comprising the

10 General Insurance Fund, and shall present findings from

11 such review to the Congress in the FHA Annual Manage12 ment Report.’’.

13 (i) ALTERNATIVE USES FOR PREVENTION OF DE14 FAULT.—

15 (1) IN GENERAL.—Subject to notice and com16 ment from existing tenants, to prevent the imminent

17 default of a multifamily housing project subject to a

18 mortgage insured under title II of the National

19 Housing Act, the Secretary may authorize the mort20 gagor to use the project for purposes not con21 templated by or permitted under the regulatory

22 agreement, if—

23 (A) such other uses are acceptable to the

24 Secretary;
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1 (B) such other uses would be otherwise in2 surable under title II of the National Housing

3 Act;

4 (C) the outstanding principal balance on

5 the mortgage covering such project is not in6 creased;

7 (D) any financial benefit accruing to the

8 mortgagor shall, subject to the discretion of the

9 Secretary, be applied to project reserves or

10 project rehabilitation; and

11 (E) such other use serves a public purpose.

12 (2) DISPLACEMENT PROTECTION.—The Sec13 retary shall—

14 (A) make available tenant-based assistance

15 under section 8 of the United States Housing

16 Act of 1937 to any tenant displaced as a result

17 of actions taken by the Secretary pursuant to

18 paragraph (1); and

19 (B) take such actions as the Secretary de20 termines necessary to ensure the successful use

21 of any tenant-based assistance provided under

22 this paragraph.

23 (3) IMPLEMENTATION.—The Secretary shall, by

24 notice published in the Federal Register, which shall

25 take effect upon publication, establish such require-
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1 ments as may be necessary to implement the amend2 ments made by this subsection. The notice shall in3 vite public comments and, not later than 12 months

4 after the date on which the notice is published, the

5 Secretary shall issue final regulations based on the

6 initial notice, taking into account any public com7 ments received.

8 (j) MORTGAGE SALE DEMONSTRATION.—The Sec9 retary may carry out a demonstration to test the feasibil10 ity of restructuring and disposing of troubled multifamily

11 mortgages held by the Secretary through the establish12 ment of partnerships between public, private, and non13 profit entities.

14 (k) NATIONAL INTERAGENCY TASK FORCE ON MUL15 TIFAMILY HOUSING.—

16 (1) FUNCTIONS.—Section 543(e)(1) of the

17 Housing and Community Development Act of 1992

18 (12 U.S.C. 1707 note) is amended—

19 (A) in subparagraph (D), by striking

20 ‘‘and’’ at the end;

21 (B) in subparagraph (E), by striking the

22 period at the end and inserting ‘‘; and’’; and

23 (C) by adding at the end the following new

24 subparagraph:
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1 ‘‘(F) make available appropriate informa2 tion to the Department of Housing and Urban

3 Development that will assist in preventing the

4 future default of multifamily housing project

5 mortgages insured under title II of the National

6 Housing Act.’’.

7 (2) USE OF APPROPRIATIONS AUTHORITY.—

8 Section 543(h) of the Housing and Community De9 velopment Act of 1992 is amended by inserting after

10 the first sentence the following: ‘‘The Secretary may

11 use any non-Federal or private funding or may use

12 the authority provided for salaries and expenses in

13 appropriations Acts for activities carried out under

14 this section.

15 SEC. 107. INTEREST RATES ON ASSIGNED MORTGAGES.

16 Section 7(i)(5) of the Department of Housing and

17 Urban Development Act (42 U.S.C. 3535(i)(5)) is amend18 ed by striking the first semicolon, and all that follows

19 through ‘‘as determined by the Secretary’’.

20 SEC. 108. AUTHORIZATION OF APPROPRIATIONS.

21 (a) SPECIAL RISK INSURANCE FUND.—Section

22 238(b) of the National Housing Act (12 U.S.C. 1715z–

23 3(b)) is amended by striking the fifth sentence.

24 (b) GENERAL INSURANCE FUND.—Section 519 of the

25 National Housing Act (12 U.S.C. 1735c) is amended—
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1 (1) by striking subsection (f); and

2 (2) by redesignating subsection (g) (as added

3 by section 106(h)(2) of this Act) as subsection (f).

4 (c) MULTIFAMILY INSURANCE FUND APPROPRIA5 TIONS.—Title V of the National Housing Act (12 U.S.C.

6 1731a et seq.) is amended by adding at the end the follow7 ing new section:

8 ‘‘SEC. 541. AUTHORIZATION OF APPROPRIATIONS FOR GEN9 ERAL AND SPECIAL RISK INSURANCE FUNDS.

10 ‘‘There are authorized to be appropriated

11 $350,000,000 for fiscal year 1994 and $360,500,000 for

12 fiscal year 1995, to be allocated in any manner that the

13 Secretary determines appropriate, for the following costs

14 incurred in conjunction with programs authorized under

15 the General Insurance Fund, as provided by section 519,

16 and the Special Risk Insurance Fund, as provided by sec17 tion 238:

18 ‘‘(1) The cost to the Government, as defined in

19 section 502 of the Congressional Budget Act, of new

20 insurance commitments.

21 ‘‘(2) The cost to the Government, as defined in

22 section 502 of the Congressional Budget Act, of

23 modifications to existing loans, loan guarantees, or

24 insurance commitments.
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1 ‘‘(3) The cost to the Government, as defined in

2 section 502 of the Congressional Budget Act, of

3 loans provided under section 203(f) of the Housing

4 and Community Development Amendments of 1978.

5 ‘‘(4) The costs of the rehabilitation of multi6 family housing projects (as defined in section 203(b)

7 of the Housing and Community Development

8 Amendments of 1978) upon disposition by the Sec9 retary.’’.

10 TITLE II—ENHANCED PROGRAM

11 FLEXIBILITY

12 Subtitle A—Office of Public and

13 Indian Housing

14 SEC. 201. REVITALIZATION OF SEVERELY DISTRESSED PUB15 LIC HOUSING.

16 (a) IN GENERAL.—Section 24 of the United States

17 Housing Act of 1937 (42 U.S.C. 1437v) is amended—

18 (1) by amending subsection (b) to read as fol19 lows:

20 ‘‘(b) [RESERVED].’’;

21 (2) in subsection (c)(2), by striking ‘‘$200,000’’

22 and inserting ‘‘$500,000’’;

23 (3) in subsection (c)(3)—
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1 (A) by redesignating subparagraphs (E)

2 through (I) as subparagraphs (F) through (J),

3 respectively;

4 (B) by inserting after subparagraph (D)

5 the following new subparagraph:

6 ‘‘(E) planning for community service and

7 support service activities to be carried out by

8 the public housing agency, residents, members

9 of the community, and other persons and orga10 nizations willing to contribute to the social, eco11 nomic, or physical improvement of the commu12 nity (community service is a required element of

13 the revitalization program);’’; and

14 (C) in subparagraph (H), as redesignated,

15 by striking ‘‘designing a suitable replacement

16 housing plan,’’ and inserting ‘‘designing suit17 able relocation and replacement housing

18 plans,’’;

19 (4) in subsection (c)(4)—

20 (A) by redesignating subparagraphs (D)

21 and (E) as subparagraphs (E) and (F), respec22 tively; and

23 (B) by inserting after subparagraph (C)

24 the following new subparagraph:
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1 ‘‘(D) a description of the community serv2 ice and support service planning activities to be

3 carried out by the public housing agency, resi4 dents, members of the community, and other

5 persons and organizations willing to contribute

6 to the social, economic, or physical improvement

7 of the community;’’;

8 (5) in subsection (c)(5)—

9 (A) by striking subparagraph (E) and re10 designating subparagraphs (F) and (G) as sub11 paragraphs (E) and (F), accordingly;

12 (B) in subparagraph (E), as redesignated,

13 by inserting before the semicolon ‘‘, taking into

14 account the condition of the stock of the public

15 housing agency as a whole’’; and

16 (C) by adding at the end the following:

17 ‘‘In making grants under this subsection, the Sec18 retary may select a lower-rated, approvable applica19 tion over a higher-rated application to increase the

20 national geographic diversity among applications ap21 proved under this section.’’;

22 (6) in subsection (d)(2)—

23 (A) by redesignating subparagraphs (E)

24 through (I) as subparagraphs (G) through (K),

25 respectively;
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1 (B) by inserting after subparagraph (D)

2 the following new subparagraphs:

3 ‘‘(E) community service activities to be

4 carried out by residents, members of the com5 munity, and other persons willing to contribute

6 to the social, economic, or physical improvement

7 of the community (community service is a re8 quired element of the revitalization program);

9 ‘‘(F) replacement of public housing units;’’;

10 and

11 (C) in subparagraph (K), as redesig12 nated—

13 (i) by striking ‘‘15 percent’’ and in14 serting ‘‘20 percent’’; and

15 (ii) by inserting before the period at

16 the end the following: ‘‘, except that an

17 amount equal to 15 percent of the amount

18 of any grant under this subsection used for

19 support services shall be contributed from

20 non-Federal sources (which contribution

21 shall be in the form of cash, administrative

22 costs, and the reasonable value of in-kind

23 contributions and may include funding

24 under title I of the Housing and Commu25 nity Development Act of 1974)’’;
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1 (7) in subsection (d)(3)—

2 (A) by redesignating subparagraphs (D)

3 and (E) as subparagraphs (E) and (F), respec4 tively; and

5 (B) by inserting after subparagraph (C)

6 the following new subparagraph:

7 ‘‘(D) a description of the community serv8 ice and support service activities to be carried

9 out by the public housing agency, residents,

10 members of the community, and other persons

11 and organizations willing to contribute to the

12 social, economic, or physical improvement of the

13 community;’’;

14 (8) in subsection (d)(4)—

15 (A) in subparagraph (D), by inserting

16 ‘‘(with assistance from the Department of

17 Housing and Urban Development if necessary)’’

18 after ‘‘applicant’’;

19 (B) by striking subparagraph (E) and re20 designating subparagraphs (F) and (G) as sub21 paragraphs (E) and (F), respectively;

22 (C) in subparagraph (E), as redesignated,

23 by inserting before the semicolon ‘‘, taking into

24 account the condition of the applicant’s stock as

25 a whole’’; and
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1 (D) by adding at the end the following:

2 ‘‘In making grants under this subsection, the Sec3 retary may select a lower-rated, approvable applica4 tion over a higher-rated application to increase the

5 national geographic diversity among applications ap6 proved under this section.’’;

7 (9) in subsection (e), by adding at the end the

8 following new paragraph:

9 ‘‘(3) DEMOLITION AND REPLACEMENT.—

10 ‘‘(A) IN GENERAL.—Notwithstanding any

11 other applicable law or regulation, a revitaliza12 tion plan under this section may include demoli13 tion and replacement on site or in the same

14 neighborhood if the number of replacement

15 units provided in the same neighborhood is

16 fewer than the number of units demolished as

17 a result of the revitalization effort.

18 ‘‘(B) TENANT-BASED ASSISTANCE.—Not19 withstanding the limitations contained in sub20 paragraph (A)(v) or (C) of section 18(b)(3), a

21 public housing agency may replace not more

22 than one-third of the units demolished or dis23 posed of through a revitalization project under

24 this section with tenant-based assistance under

25 section 8.’’;
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1 (10) in subsection (h)—

2 (A) by amending paragraph (5) to read as

3 follows:

4 ‘‘(5) SEVERELY DISTRESSED PUBLIC HOUS5 ING.—The term ‘severely distressed public housing’

6 means a public housing project or a building in a

7 project—

8 ‘‘(A) that requires major redesign, recon9 struction, redevelopment, or partial or total

10 demolition to correct serious deficiencies in the

11 original design (including inappropriately high

12 population density), deferred maintenance,

13 physical deterioration or obsolescence of major

14 systems, and other deficiencies in the physical

15 plant of the project; and

16 ‘‘(B) that either—

17 ‘‘(i)(I) is occupied predominantly by

18 families with children that have extremely

19 low incomes, high rates of unemployment,

20 and extensive dependency on various forms

21 of public assistance; and

22 ‘‘(II) has high rates of vandalism and

23 criminal activity (including drug-related

24 criminal activity); or
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1 ‘‘(ii) that has a vacancy rate, as deter2 mined by the Secretary, of 50 percent or

3 more;

4 ‘‘(C) that cannot be revitalized through as5 sistance under other programs, such as the pro6 grams under sections 9 and 14, or through

7 other administrative means because of the inad8 equacy of available funds; and

9 ‘‘(D) that, in the case of individual build10 ings, the building is, in the Secretary’s deter11 mination, sufficiently separable from the re12 mainder of the project to make use of the build13 ing feasible for purposes of this section.’’; and

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

15 paragraphs:

16 ‘‘(6) COMMUNITY SERVICE.—The term ‘commu17 nity service’ means services provided on a volunteer

18 or limited stipend basis for the social, economic, or

19 physical improvement of the community to be

20 served.

21 ‘‘(7) SUPPORT SERVICES.—The term ‘support

22 services’ includes all activities designed to lead to23 ward upward mobility, self-sufficiency, and improved

24 quality of life for the residents of the project, such

25 as literacy training, job training, day care, and eco-
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1 nomic development. Such activities may allow for the

2 participation of residents of the neighborhood.’’; and

3 (11) in subsection (i)—

4 (A) by striking paragraph (2); and

5 (B) by redesignating paragraphs (3) and

6 (4) as paragraphs (2) and (3), respectively.

7 (b) CONFORMING AMENDMENT.—The first sentence

8 of section 25(m)(1) of the United States Housing Act of

9 1937 (42 U.S.C. 1437w(m)(1)) is amended to read as fol10 lows:

11 ‘‘(1) The term ‘eligible housing’ means a public

12 housing project, or one or more buildings within a

13 project, that is owned or operated by a public hous14 ing agency that has been troubled for not less than

15 3 years and that, as determined by the Secretary,

16 has failed to make substantial progress toward effec17 tive management.’’.

18 (c) USE OF TENANT-BASED ASSISTANCE FOR RE19 PLACEMENT HOUSING.—Section 18(b)(3)(C)(i) of the

20 United States Housing Act of 1937 (42 U.S.C.

21 1437p(b)(3)(C)(i)) is amended by striking ‘‘15-year’’.

22 (d) REPLACEMENT HOUSING OUTSIDE THE JURIS23 DICTION OF THE PHA.—Section 18(b)(3) of the United

24 States Housing Act of 1937 (42 U.S.C. 1437p(b)(3)), as

25 amended by subsection (c), is amended—
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1 (1) by redesignating subparagraphs (D)

2 through (H) as subparagraphs (E) through (I), re3 spectively; and

4 (2) by inserting after subparagraph (C) the fol5 lowing new subparagraph:

6 ‘‘(D) may provide that all or part of such addi7 tional dwelling units may be located outside of the

8 jurisdiction of the public housing agency (the ‘origi9 nal agency’) if—

10 ‘‘(i) the location is in the same housing

11 market area as the original agency, as deter12 mined by the Secretary;

13 ‘‘(ii) the plan contains an agreement be14 tween the original agency and the public hous15 ing agency in the alternate location or other

16 public or private entity that will be responsible

17 for providing the additional units in the alter18 nate location (‘alternate agency or entity’) that

19 the alternate agency or entity will, with respect

20 to the dwelling units involved—

21 ‘‘(I) provide the dwelling units in ac22 cordance with subparagraph (A);

23 ‘‘(II) complete the plan on schedule in

24 accordance with subparagraph (F);
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1 ‘‘(III) meet the requirements of sub2 paragraph (G) and the maximum rent pro3 visions of subparagraph (H); and

4 ‘‘(IV) not impose a local residency

5 preference on any resident of the jurisdic6 tion of the original agency for purposes of

7 admission to any such units; and

8 ‘‘(iii) the arrangement is approved by the

9 unit of general local government for the juris10 diction in which the additional units will be lo11 cated;’’.

12 SEC. 202. DISALLOWANCE OF EARNED INCOME FOR RESI13 DENTS WHO OBTAIN EMPLOYMENT.

14 (a) IN GENERAL.—Section 3 of the United States

15 Housing Act of 1937 (42 U.S.C. 1437a) is amended—

16 (1) by striking the undesignated paragraph at

17 the end of subsection (c)(3) (as added by section

18 515(b) of the Cranston-Gonzalez National Afford19 able Housing Act); and

20 (2) by adding at the end the following new sub21 section:

22 ‘‘(d) DISALLOWANCE OF EARNED INCOME FROM

23 PUBLIC HOUSING RENT DETERMINATIONS.—Notwith24 standing any other provision of law, the rent payable

25 under subsection (a) for any public housing unit by a fam-
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1 ily whose income increases as a result of employment of

2 a member of the family who was previously unemployed

3 for one or more years (including a family whose income

4 increases as a result of the participation of a family mem5 ber in the Family Self-Sufficiency program or other job

6 training program) shall not be increased for a period of

7 18 months, beginning with the commencement of employ8 ment as a result of the increased income due to such em9 ployment. After the expiration of the 18-month period,

10 rent increases due to the continued employment of such

11 family member shall be limited to 10 percent per year.

12 In no case shall rent exceed the amount determined under

13 subsection (a).’’.

14 (b) APPLICABILITY OF AMENDMENT.—Notwithstand15 ing the amendment made by subsection (a), any resident

16 of public housing participating in the program under the

17 authority contained in the undesignated paragraph at the

18 end of section 3(c)(3) of the United States Housing Act

19 of 1937 as such paragraph existed before the date of en20 actment of this subsection shall continue to be governed

21 by such authority.
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1 SEC. 203. CEILING RENTS BASED ON REASONABLE RENTAL

2 VALUE.

3 (a) AMENDMENT.—Section 3(a)(2)(A)(iii) of the

4 United States Housing Act of 1937 (42 U.S.C.

5 1437a(a)(2)(A)(iii)) is amended to read as follows:

6 ‘‘(iii) is not less than the reasonable rental

7 value of the unit, as determined by the Secretary.’’.

8 (b) REGULATIONS.—

9 (1) IN GENERAL.—The Secretary shall, by reg10 ulation, after notice and an opportunity for public

11 comment, establish such requirements as may be

12 necessary to carry out the provisions of section

13 3(a)(2)(A) of the United States Housing Act of

14 1937, as amended by subsection (a).

15 (2) APPLICABILITY.—Except in the case of an

16 Indian housing authority, the regulations issued pur17 suant to paragraph (1) shall not apply to scattered

18 site public housing units.

19 (3) TRANSITION RULE.—Prior to the issuance

20 of final regulations under paragraph (1), a public

21 housing agency may implement ceiling rents which

22 shall be—

23 (A) determined in accordance with section

24 3(a)(2)(A) of the United States Housing Act of

25 1937, as such section existed before the date of

26 enactment of this Act; or
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1 (B) equal to the 95th percentile of the rent

2 paid for a unit of comparable size by tenants in

3 the same project or a group of comparable

4 projects totaling 50 units or more.

5 SEC. 204. RESIDENT MANAGEMENT PROGRAM.

6 Section 20(f) of the United States Housing Act of

7 1937 (42 U.S.C. 1437r(f)) is amended—

8 (1) in paragraph (2), by striking ‘‘$100,000’’

9 and inserting ‘‘$250,000’’; and

10 (2) in paragraph (3), by adding at the end the

11 following: ‘‘The Secretary may use not more than 10

12 percent of the amounts made available under this

13 subsection for program monitoring and evaluation,

14 technical assistance, and information dissemina15 tion.’’.

16 Subtitle B—Office of Community

17 Planning and Development

18 SEC. 211. ECONOMIC DEVELOPMENT INITIATIVE.

19 (a) SECTION 108 ELIGIBLE ACTIVITIES.—

20 (1) IN GENERAL.—Section 108(a) of the Hous21 ing and Community Development Act of 1974 (42

22 U.S.C. 5308(a)) is amended—

23 (A) in the first sentence—

24 (i) by striking ‘‘or’’ after ‘‘section

25 105(a);’’; and
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1 (ii) by inserting before the period the

2 following: ‘‘; (5) the acquisition, construc3 tion, reconstruction, or installation of pub4 lic facilities (except for buildings for the

5 general conduct of government); or (6) in

6 the case of colonias, public works and site

7 or other improvements’’; and

8 (B) by striking the second sentence and in9 serting the following: ‘‘A guarantee under this

10 section (including a guarantee combined with a

11 grant under subsection (q)) may be used to as12 sist a grantee in obtaining financing only if the

13 grantee has made efforts to obtain the financ14 ing without the use of the guarantee (and, if

15 applicable, the grant) and cannot complete the

16 financing consistent with the timely execution

17 of the proposed activities and projects without

18 the guarantee (or, if applicable, the grant).’’.

19 (2) DEFINITION.—Section 102(a) of the Hous20 ing and Community Development Act of 1974 (42

21 U.S.C. 5302(a)) is amended by adding at the end

22 the following new paragraph:

23 ‘‘(24) The term ‘colonia’ means any identifiable

24 community that—
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1 ‘‘(A) is in the State of Arizona, California,

2 New Mexico, or Texas;

3 ‘‘(B) is in the United States-Mexico border

4 region;

5 ‘‘(C) is determined to be a colonia on the

6 basis of objective criteria, including lack of po7 table water supply, lack of adequate sewage sys8 tems, and lack of decent, safe, and sanitary

9 housing; and

10 ‘‘(D) was in existence as a colonia before

11 the date of the enactment of the Cranston-Gon12 zalez National Affordable Housing Act.’’.

13 (b) ECONOMIC DEVELOPMENT GRANTS.—

14 (1) IN GENERAL.—Section 108 of the Housing

15 and Community Development Act of 1974 (42

16 U.S.C. 5308) is amended by adding at the end the

17 following new subsection:

18 ‘‘(q) ECONOMIC DEVELOPMENT GRANTS.—

19 ‘‘(1) AUTHORIZATION.—The Secretary may

20 make grants in connection with notes or other obli21 gations guaranteed under this section to eligible

22 public entities for the purpose of enhancing the secu23 rity of loans guaranteed under this section or im24 proving the viability of projects financed with loans

25 guaranteed under this section.
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1 ‘‘(2) ELIGIBLE ACTIVITIES.—Assistance under

2 this subsection may be used for the purposes of and

3 in conjunction with projects and activities assisted

4 under subsection (a).

5 ‘‘(3) APPLICATIONS.—Applications for assist6 ance under this subsection shall be submitted by eli7 gible public entities in the form and in accordance

8 with the procedures established by the Secretary. El9 igible public entities may apply for grants only in

10 conjunction with a request for guarantee under sub11 section (a).

12 ‘‘(4) SELECTION CRITERIA.—The Secretary

13 shall establish criteria for awarding assistance under

14 this subsection. Such criteria shall include—

15 ‘‘(A) the extent of need for such assist16 ance;

17 ‘‘(B) the level of distress in the community

18 to be served and in the jurisdiction applying for

19 assistance;

20 ‘‘(C) the quality of the plan proposed and

21 the capacity or potential capacity of the appli22 cant to successfully carry out the plan; and

23 ‘‘(D) such other factors as the Secretary

24 determines to be appropriate.’’.
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1 (2) CONFORMING AMENDMENT.—Title I of the

2 Housing and Community Development Act of 1974

3 (42 U.S.C. 5301 et seq.) is amended—

4 (A) in section 101(c) in the second sen5 tence, by inserting ‘‘or a grant’’ after ‘‘guaran6 tee’’; and

7 (B) in section 104(b)(3), by inserting ‘‘or

8 a grant’’ after ‘‘guarantee’’.

9 (c) USE OF UDAG RECAPTURES.—Section 119(o) of

10 the Housing and Community Development Act of 1974

11 (42 U.S.C. 5318(o)) is amended by inserting before the

12 period the following: ‘‘, except that amounts available to

13 the Secretary for use under this subsection as of October

14 1, 1993, and amounts released to the Secretary pursuant

15 to subsection (t) may be used to provide grants under sec16 tion 108(q).’’.

17 (d) UDAG AMNESTY PROGRAM.—

18 (1) AMENDMENT.—Section 119 of the Housing

19 and Community Development Act of 1974 (42

20 U.S.C. 5318) is amended by adding at the end the

21 following new subsection:

22 ‘‘(t) UDAG AMNESTY PROGRAM.—If a grant or a

23 portion of a grant under this section remains unexpended

24 as of the issuance of a notice implementing this sub25 section, the grantee may enter into an agreement, as pro-
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1 vided under this subsection, with the Secretary to receive

2 a percentage of the grant amount and relinquish all claims

3 to the balance of the grant within 90 days of the issuance

4 of notice implementing this subsection (or such later date

5 as the Secretary may approve). The Secretary shall not

6 recapture any funds obligated pursuant to this section

7 during a period beginning on the date of enactment of the

8 Housing and Community Development Act of 1993 until

9 90 days after the issuance of a notice implementing this

10 subsection. A grantee may receive as a grant under this

11 subsection—

12 ‘‘(1) 33 percent of such unexpended amounts

13 if—

14 ‘‘(A) the grantee agrees to expend not less

15 than one-half of the amount received for activi16 ties authorized pursuant to section 108(q) and

17 to expend such funds in conjunction with a loan

18 guarantee made under section 108 at least

19 equal to twice the amount of the funds received;

20 and

21 ‘‘(B)(i) the remainder of the amount re22 ceived is used for economic development activi23 ties eligible under title I of this Act; and

24 ‘‘(ii) except when waived by the Secretary

25 in the case of a severely distressed jurisdiction,
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1 not more than one-half of the costs of activities

2 under subparagraph (B) are derived from such

3 unexpended amounts; or

4 ‘‘(2) 25 percent of such unexpended amounts

5 if—

6 ‘‘(A) the grantee agrees to expend such

7 funds for economic development activities eligi8 ble under title I of this Act; and

9 ‘‘(B) except when waived by the Secretary

10 in the case of a severely distressed jurisdiction,

11 not more than one-half of the costs of such ac12 tivities are derived from such unexpended

13 amount.’’.

14 (2) IMPLEMENTATION.—Notwithstanding sub15 section (f), not later than 10 days after the date of

16 enactment of this Act, the Secretary shall, by notice

17 published in the Federal Register, which shall take

18 effect upon publication, establish such requirements

19 as may be necessary to implement the amendments

20 made by this subsection.

21 (e) GUARANTEE OF OBLIGATIONS BACKED BY SEC22 TION 108 LOANS.—Section 108 of the Housing and Com23 munity Development Act of 1974 (42 U.S.C. 5308), as

24 amended by subsection (b), is amended by adding at the

25 end the following new subsection:
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1 ‘‘(r) GUARANTEE OF OBLIGATIONS BACKED BY SEC2 TION 108 LOANS.—

3 ‘‘(1) AUTHORIZATION.—The Secretary may,

4 upon such terms and conditions as the Secretary

5 deems appropriate, guarantee the timely payment of

6 the principal of and interest on trust certificates or

7 other obligations that—

8 ‘‘(A) are offered by the Secretary, or by

9 any other offeror approved for purposes of this

10 subsection by the Secretary; and

11 ‘‘(B) are based on and backed by a trust

12 or pool composed of notes or other obligations

13 guaranteed by the Secretary under this section.

14 ‘‘(2) FULL FAITH AND CREDIT OF THE UNITED

15 STATES.—Subsection (f) shall apply to any guaran16 tee under this subsection.

17 ‘‘(3) SUBROGATION.—If the Secretary pays a

18 claim under a guarantee issued under this section,

19 the Secretary shall be subrogated fully to the rights

20 satisfied by such payment.

21 ‘‘(4) POWERS OF THE SECRETARY.—No Fed22 eral, State, or local law shall preclude or limit the

23 exercise by the Secretary of—

24 ‘‘(A) the power to contract with respect to

25 public offerings and other sales of notes, trust
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1 certificates, and other obligations guaranteed

2 under this section upon such terms and condi3 tions as the Secretary deems appropriate;

4 ‘‘(B) the right to enforce by any means

5 deemed appropriate by the Secretary any such

6 contract; and

7 ‘‘(C) the Secretary’s ownership rights, as

8 applicable, in notes, certificates, or other obliga9 tions guaranteed under this section, or con10 stituting the trust or pool against which trust

11 certificates or other obligations guaranteed

12 under this section are offered.’’.

13 (f) EFFECTIVE DATE.—The Secretary shall, by no14 tice published in the Federal Register, which shall take

15 effect upon publication, establish such requirements as

16 may be necessary to implement the amendments made by

17 this section. The notice shall invite public comments and,

18 not later than 12 months after the date on which the no19 tice is published, the Secretary shall issue final regulations

20 based on the initial notice, taking into account any public

21 comments received.

22 SEC. 212. HOME INVESTMENT PARTNERSHIPS.

23 (a) PARTICIPATION BY STATE AGENCIES OR INSTRU24 MENTALITIES.—Section 104(2) of the Cranston-Gonzalez

25 National Affordable Housing Act (42 U.S.C. 12704(2)) is
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1 amended by inserting before the period at the end the fol2 lowing: ‘‘, or any agency or instrumentality thereof that

3 is established pursuant to legislation and designated by

4 the chief executive to act on behalf of the State with re5 gard to the provisions of this Act’’.

6 (b) SIMPLIFY PROGRAM-WIDE INCOME TARGETING

7 FOR HOME RENTAL HOUSING.—Section 214(1) of the

8 Cranston-Gonzalez National Affordable Housing Act (42

9 U.S.C. 12744(1)) is amended by striking ‘‘such funds are

10 invested with respect to dwelling units that are occupied

11 by’’ each place such term appears and inserting ‘‘(i) the

12 families receiving such rental assistance are, or (ii) the

13 dwelling units assisted with such funds are occupied by’’

14 in each such place.

15 (c) REMOVE FIRST-TIME HOMEBUYER LIMITATION

16 FOR HOME UNITS.—Section 215(b) of the Cranston-Gon17 zalez National Affordable Housing Act (42 U.S.C.

18 12745(b)) is amended by striking paragraph (3) and re19 designating paragraphs (4) and (5) as paragraphs (3) and

20 (4), respectively.

21 (d) SIMPLIFY RESALE PROVISIONS.—Section

22 215(b)(3)(B) of the Cranston-Gonzalez National Afford23 able Housing Act (42 U.S.C. 12745(b)(4)(B)), as redesig24 nated by subsection (c), is amended by striking ‘‘sub25 section’’ and inserting ‘‘title’’.
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1 (e) STABILIZATION OF HOME FUNDING THRESH2 OLDS.—The Cranston-Gonzalez National Affordable

3 Housing Act (42 U.S.C. 12701 et seq.) is amended—

4 (1) in section 216, by striking paragraph (10);

5 (2) in section 217(b), by striking paragraph

6 (4);

7 (3) in section 217(b)(3)—

8 (A) in the first sentence, by striking ‘‘only

9 those jurisdictions’’ and all that follows through

10 ‘‘allocation’’ and inserting ‘‘jurisdictions that

11 are not participating jurisdictions that are allo12 cated an amount of $500,000 or more and ju13 risdictions that are participating jurisdictions

14 shall receive an allocation’’; and

15 (B) in the last sentence, by striking ‘‘, ex16 cept as provided in paragraph (4)’’; and

17 (4) in section 216—

18 (A) in paragraph (3)(A), by striking ‘‘Ex19 cept as provided in paragraph (10), a jurisdic20 tion’’ and inserting ‘‘A jurisdiction’’; and

21 (B) in paragraph (9)(B), by striking ‘‘, ex22 cept as provided in paragraph (10)’’.

23 (f) COMPREHENSIVE AFFORDABLE HOUSING STRAT24 EGY.—
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1 (1) HOME PROGRAM.—Section 218(d) of the

2 Cranston-Gonzalez National Affordable Housing Act

3 (42 U.S.C. 12748(d)) is amended in the first sen4 tence, by inserting ‘‘that it is following a current

5 housing affordability strategy that has been ap6 proved by the Secretary in accordance with section

7 105, and’’ after ‘‘certification’’.

8 (2) HOMELESS ASSISTANCE PROGRAMS.—Sec9 tion 401 of the Stewart B. McKinney Homeless As10 sistance Act (42 U.S.C. 11361) is amended to read

11 as follows:

12 ‘‘SEC. 401. HOUSING AFFORDABILITY STRATEGY.

13 ‘‘(a) REQUIREMENT TO FOLLOW A CHAS.—Assist14 ance may be made available under subtitle B to metropoli15 tan cities, urban counties, and States receiving a formula

16 amount under section 413, only if the jurisdiction certifies

17 that it is following a current housing affordability strategy

18 that has been approved by the Secretary in accordance

19 with section 105 of the Cranston-Gonzalez National Af20 fordable Housing Act.

21 ‘‘(b) REQUIREMENT FOR CONSISTENCY WITH

22 CHAS.—Assistance may be made available under this title

23 only if the application contains a certification that the pro24 posed project or activities are consistent with the housing

25 affordability strategy of the State or unit of general local
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1 government in which the project is located. The certifi2 cation shall be from the public official responsible for sub3 mitting the strategy for the jurisdiction.’’.

4 (3) CONFORMING CHANGES.—Title IV of the

5 Stewart B. McKinney Homeless Assistance Act (42

6 U.S.C. 11361 et seq.) is amended by striking sec7 tions 426(a)(2)(F), 434(a)(10), and 454(b)(9).

8 (g) HOME MATCHING REQUIREMENTS.—Section

9 220(a) of the Cranston-Gonzalez National Affordable

10 Housing Act (42 U.S.C. 12750(a)) is amended to read as

11 follows:

12 ‘‘(a) CONTRIBUTION.—Each participating jurisdic13 tion shall make contributions to housing that qualifies as

14 affordable housing under this title that total, throughout

15 a fiscal year, not less than 25 percent of the funds drawn

16 from the jurisdiction’s HOME Investment Trust Fund in

17 that fiscal year. Such contribution shall be in addition to

18 any amounts made available under section 216(3)(A)(ii).’’.

19 (h) SEPARATE AUDIT REQUIREMENT FOR THE

20 HOME PROGRAM.—Section 283 of the Cranston-Gon21 zalez National Affordable Housing Act (42 U.S.C. 12833)

22 is amended—

23 (1) by striking the section heading and insert24 ing the following:
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1 ‘‘SEC. 283. AUDITS BY THE COMPTROLLER GENERAL.’’;

2 (2) by striking subsection (a);

3 (3) in subsection (b)—

4 (A) by striking ‘‘(b) AUDITS BY THE

5 COMPTROLLER GENERAL.—’’; and

6 (B) by redesignating paragraphs (1) and

7 (2) as subsections (a) and (b), respectively; and

8 (4) in subsection (a), as redesignated by para9 graph (3), by striking the second sentence.

10 (i) HOME ENVIRONMENTAL REVIEW AMEND11 MENTS.—Section 288 of the Cranston-Gonzalez National

12 Affordable Housing Act (42 U.S.C. 12838) is amended—

13 (1) in subsection (a)—

14 (A) in the first sentence, by striking ‘‘par15 ticipating jurisdictions’’ and inserting ‘‘jurisdic16 tions, Indian tribes, or insular areas’’; and

17 (B) by adding at the end the following:

18 ‘‘The regulations shall—

19 ‘‘(1) provide for the monitoring of environ20 mental reviews performed under this section;

21 ‘‘(2) at the discretion of the Secretary, facilitate

22 training for the performance of such reviews; and

23 ‘‘(3) establish criteria for the suspension or ter24 mination of the assumption under this section.

25 The Secretary’s duty under this subsection shall not be

26 construed to limit any responsibility assumed by a State
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1 or unit of general local government with respect to any

2 particular release of funds.’’;

3 (2) in subsection (b) in the first sentence, by

4 striking ‘‘participating jurisdiction’’ and inserting

5 ‘‘jurisdiction, Indian tribe, or insular area’’;

6 (3) in subsection (c)(4), by striking ‘‘participat7 ing jurisdiction’’ and inserting ‘‘jurisdiction, Indian

8 tribe, or insular area’’; and

9 (4) in subsection (d), by striking ‘‘ASSISTANCE

10 TO A STATE.—In the case of assistance to States’’

11 and inserting the following: ‘‘ASSISTANCE TO UNITS

12 OF GENERAL LOCAL GOVERNMENT FROM A

13 STATE.—In the case of assistance to units of gen14 eral local government from a State’’.

15 (j) USE OF CDBG FUNDS FOR HOME ADMINISTRA16 TIVE EXPENSES.—Section 105(a)(13) of the Housing and

17 Community Development Act of 1974 (42 U.S.C.

18 5305(a)(13)) is amended by inserting after ‘‘charges relat19 ed to’’ the following: ‘‘(A) administering the HOME pro20 gram under title II of the Cranston-Gonzalez National Af21 fordable Housing Act; and (B)’’.

22 (k) PROJECT DELIVERY COSTS.—Section 105(a)(21)

23 of the Housing and Community Development Act of 1974

24 (42 U.S.C. 5305(a)(21)) is amended—
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1 (1) by inserting ‘‘in connection with tenant2 based assistance and affordable housing projects as3 sisted under title II of the Cranston-Gonzalez Na4 tional Affordable Housing Act’’ after ‘‘housing coun5 seling’’; and

6 (2) by striking ‘‘authorized’’ and all that follows

7 through ‘‘any law’’ and inserting ‘‘assisted under

8 title II of the Cranston-Gonzalez National Afford9 able Housing Act’’.

10 SEC. 213. HOPE MATCH REQUIREMENT.

11 Section 443(c)(1) of the Cranston-Gonzalez National

12 Affordable Housing Act (42 U.S.C. 12893(c)(1)) is

13 amended by striking ‘‘33’’ and inserting ‘‘25’’.

14 SEC. 214. FLEXIBILITY OF CDBG PROGRAM FOR DISASTER

15 AREAS.

16 Title I of the Housing and Community Development

17 Act of 1974 (42 U.S.C. 5301 et seq.) is amended by add18 ing at the end the following new section:

19 ‘‘SEC. 122. SUSPENSION OF REQUIREMENTS FOR DISASTER

20 AREAS.

21 ‘‘For the duration of time during which an area has

22 been declared a disaster area by the President under title

23 IV of the Robert T. Stafford Disaster Relief and Emer24 gency Assistance Act, the Secretary may suspend all re25 quirements for purposes of assistance under section 106
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1 for that area, except for those related to public notice of

2 funding availability, nondiscrimination, fair housing, labor

3 standards, environmental standards, and requirements

4 that activities benefit persons of low- and moderate-in5 come.’’.

6 SEC. 215. FLEXIBILITY OF HOME PROGRAM FOR DISASTER

7 AREAS.

8 Title II of the Cranston-Gonzalez National Affordable

9 Housing Act (42 U.S.C. 12721 et seq.) is amended by

10 adding at the end the following new section:

11 ‘‘SEC. 290. SUSPENSION OF REQUIREMENTS FOR DISASTER

12 AREAS.

13 ‘‘For the duration of time during which an area has

14 been declared a disaster area by the President under title

15 IV of the Robert T. Stafford Disaster Relief and Emer16 gency Assistance Act, the Secretary may suspend all re17 quirements for purposes of assistance under this title for

18 that area, except for those related to public notice of fund19 ing availability, nondiscrimination, fair housing, labor

20 standards, environmental standards, and low-income hous21 ing affordability.’’.
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1 Subtitle C—Community

2 Partnerships Against Crime

3 SEC. 221. COMPAC PROGRAM.

4 (a) CONFORMING PROVISIONS.—Section 5001 of the

5 Anti-Drug Abuse Act of 1988 (42 U.S.C. 11901) is

6 amended in the table of contents—

7 (1) by striking the item relating to the heading

8 for chapter 2 and inserting the following:

‘‘CHAPTER 2—COMMUNITY PARTNERSHIPS AGAINST CRIME’’;

9 (2) by striking the item relating to section 5122

10 and inserting the following:

‘‘Sec. 5122. Purposes.’’;

11 and

12 (3) by adding the following after the item relat13 ing to section 5130:

‘‘Sec. 5131. Technical assistance.’’.

14 (b) SHORT TITLE, PURPOSES, AND AUTHORITY TO

15 MAKE GRANTS.—The Public and Assisted Housing Drug

16 Elimination Act of 1990 (42 U.S.C. 11901 et seq.) is

17 amended by striking the chapter heading for chapter 2,

18 and by striking sections 5121, 5122, and 5123 and insert19 ing the following:
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1 ‘‘CHAPTER 2—COMMUNITY

2 PARTNERSHIPS AGAINST CRIME

3 ‘‘SEC. 5121. SHORT TITLE.

4 ‘‘This chapter may be cited as the ‘Community Part5 nerships Against Crime Act of 1993’.

6 ‘‘SEC. 5122. PURPOSES.

7 ‘‘The purposes of this chapter are to—

8 ‘‘(1) improve the quality of life for law-abiding

9 public housing residents by reducing the levels of

10 fear, violence, and crime in their communities;

11 ‘‘(2) expand and enhance the Federal Govern12 ment’s commitment to eliminating crime in public

13 housing;

14 ‘‘(3) broaden the scope of the Public and As15 sisted Housing Drug Elimination Act of 1990 to

16 apply to all types of crime, and not simply crime

17 that is drug-related;

18 ‘‘(4) target opportunities for long-term commit19 ments of funding primarily to public housing agen20 cies with serious crime problems;

21 ‘‘(5) encourage the involvement of a broad

22 range of community-based groups, and residents of

23 neighboring housing that is owned or assisted by the

24 Secretary, in the development and implementation of

25 anti-crime plans;
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1 ‘‘(6) reduce crime and disorder in and around

2 public housing through the expansion of community3 oriented policing activities and problem solving;

4 ‘‘(7) provide training, information services, and

5 other technical assistance to program participants;

6 and

7 ‘‘(8) establish a standardized assessment sys8 tem to evaluate need among public housing agencies,

9 and to measure progress in reaching crime reduction

10 goals.

11 ‘‘SEC. 5123. AUTHORITY TO MAKE GRANTS.

12 ‘‘The Secretary of Housing and Urban Development,

13 in accordance with the provisions of this chapter, may

14 make grants, for use in eliminating crime in and around

15 public and other federally assisted low-income housing

16 projects (1) to public housing agencies (including Indian

17 housing authorities), and (2) to private, for profit, and

18 nonprofit owners of federally assisted low-income housing.

19 In designing the program, the Secretary shall consult with

20 the Attorney General.’’.

21 (c) ELIGIBLE ACTIVITIES.—Section 5124(a) of the

22 Public and Assisted Housing Drug Elimination Act of

23 1990 (42 U.S.C. 11903(a)) is amended—
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1 (1) in the introductory material preceding para2 graph (1), by inserting ‘‘and around’’ after ‘‘used

3 in’’;

4 (2) in paragraph (3), by inserting ‘‘, such as

5 fencing, lighting, locking, and surveillance systems’’

6 before the semicolon;

7 (3) in paragraph (4), by striking subparagraph

8 (A) and inserting the following new subparagraph:

9 ‘‘(A) to investigate crime; and’’;

10 (4) in paragraph (6)—

11 (A) by striking ‘‘in and around public or

12 other federally assisted low-income housing

13 projects’’; and

14 (B) by striking ‘‘and’’ after the semicolon;

15 (5) in paragraph (7)—

16 (A) by striking ‘‘where a public housing

17 agency receives a grant,’’;

18 (B) by striking ‘‘drug abuse’’ and inserting

19 ‘‘crime’’; and

20 (C) by striking the period at the end and

21 inserting a semicolon; and

22 (6) by adding at the end the following new

23 paragraphs:

24 ‘‘(8) the employment or utilization of one or

25 more individuals, including law enforcement officers,
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1 made available by contract or other cooperative ar2 rangement with State or local law enforcement agen3 cies, to engage in community policing involving

4 interaction with members of the community on

5 proactive crime control and prevention;

6 ‘‘(9) youth initiatives, such as activities involv7 ing training, education, after school programs, cul8 tural programs, recreation and sports, career plan9 ning, and entrepreneurship and employment; and

10 ‘‘(10) resident service programs, such as job

11 training, education programs, drug and alcohol

12 treatment, and other appropriate social services that

13 address the contributing factors of crime.’’.

14 (d) APPLICATIONS.—Section 5125 of the Public and

15 Assisted Housing Drug Elimination Act of 1990 (42

16 U.S.C. 11904) is amended—

17 (1) in subsection (a)—

18 (A) by striking ‘‘To receive a grant’’ and

19 inserting the following:

20 ‘‘(1) APPLICATIONS.—To receive a grant’’;

21 (B) in the second sentence, by striking

22 ‘‘drug-related crime on the premises of’’ and in23 serting the following: ‘‘crime in and around’’;

24 and
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1 (C) by adding at the end the following new

2 paragraphs:

3 ‘‘(2) ONE-YEAR RENEWABLE GRANTS.—

4 ‘‘(A) IN GENERAL.—Eligible applicants

5 may submit an application for a 1-year grant

6 under this chapter that, subject to the availabil7 ity of appropriated amounts, shall be renewed

8 annually for a period of not more than 4 years,

9 if the Secretary finds, after an annual or more

10 frequent performance review, that the public

11 housing agency is performing under the terms

12 of the grant and applicable laws in a satisfac13 tory manner and meets such other requirements

14 as the Secretary may prescribe.

15 ‘‘(B) PREFERENCE.—The Secretary shall

16 accord a preference to applicants for grants

17 under this paragraph if the grant is to be used

18 to continue or expand activities eligible for as19 sistance under this chapter that have received

20 previous assistance either under this chapter, as

21 it existed prior to the enactment of the Housing

22 and Community Development Act of 1993, or

23 under section 14 of the United States Housing

24 Act of 1937. Such preference shall not preclude

25 the selection by the Secretary of other meritori-
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1 ous applications, particularly applications which

2 address urgent or severe crime problems or

3 which demonstrate especially promising ap4 proaches to reducing crime. Such preference

5 shall not be construed to require continuation

6 of activities determined by the Secretary to be

7 unworthy of continuation.

8 ‘‘(3) PUBLIC HOUSING AGENCIES THAT HAVE

9 ESPECIALLY SEVERE CRIME PROBLEMS.—The Sec10 retary shall, by regulation issued after notice and

11 opportunity for public comment, set forth criteria for

12 establishing a class of public housing agencies that

13 have especially severe crime problems. The Secretary

14 may allocate a portion of the annual appropriation

15 for this program for public housing agencies in this

16 class.’’.

17 (2) in subsection (b)—

18 (A) by striking the introductory material

19 preceding paragraph (1) and inserting the fol20 lowing: ‘‘The Secretary shall approve applica21 tions under subsection (a)(2) that are not sub22 ject to a preference under subsection (a)(2)(B)

23 on the basis of—’’;
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1 (B) in paragraph (1), by striking ‘‘drug-re2 lated crime problem in’’ and inserting the fol3 lowing: ‘‘crime problem in and around’’;

4 (C) in paragraph (2), by inserting imme5 diately after ‘‘crime problem in’’ the following:

6 ‘‘and around’’; and

7 (D) in paragraph (4), by inserting after

8 ‘‘local government’’ the following: ‘‘, local com9 munity-based nonprofit organizations, local resi10 dent organizations that represent the residents

11 of neighboring projects that are owned or as12 sisted by the Secretary,’’;

13 (3) in subsection (c)(2), by striking ‘‘drug-relat14 ed’’ each place it appears; and

15 (4) by striking subsection (d).

16 (e) DEFINITIONS.—Section 5126 of the Public and

17 Assisted Housing Drug Elimination Act of 1990 (42

18 U.S.C. 11905) is amended by striking paragraphs (1) and

19 (2), and redesignating paragraphs (3) and (4) as para20 graphs (1) and (2), respectively.

21 (f) IMPLEMENTATION.—Section 5127 of the Public

22 and Assisted Housing Drug Elimination Act of 1990 (42

23 U.S.C. 11906) is amended by striking ‘‘Cranston-Gonzalez

24 National Affordable Housing Act’’ and inserting ‘‘Housing

25 and Community Development Act of 1993’’.
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1 (g) REPORTS.—Section 5128 of the Public and As2 sisted Housing Drug Elimination Act of 1990 (42 U.S.C.

3 11907) is amended—

4 (1) by striking ‘‘The Secretary’’ and inserting

5 the following:

6 ‘‘(a) GRANTEE REPORTS.—The Secretary’’;

7 (2) by striking ‘‘drug-related crime in’’ and in8 serting ‘‘crime in and around’’; and

9 (3) by adding at the end the following new sub10 section:

11 ‘‘(b) HUD REPORTS.—The Secretary shall submit a

12 report to the Congress describing the system used to dis13 tribute funds to grantees under this section. Such report

14 shall include, at a minimum—

15 ‘‘(1) a description of the criteria used to estab16 lish the class of public housing agencies with espe17 cially severe crime problems and a list of such agen18 cies;

19 ‘‘(2) the methodology used to distribute funds

20 among the public housing agencies on the list cre21 ated under paragraph (1); and

22 ‘‘(3) the Secretary’s recommendations for any

23 change to the method of distribution of funds.’’.
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1 (h) AUTHORIZATION OF APPROPRIATIONS.—Section

2 5130 of the Public and Assisted Housing Drug Elimi3 nation Act of 1990 (42 U.S.C. 11909) is amended—

4 (1) in the first sentence of subsection (a), by

5 striking ‘‘$175,000,000 for fiscal year 1993’’ and all

6 that follows through the end of the sentence and in7 serting ‘‘$265,000,000 for fiscal year 1994 and

8 $325,000,000 for fiscal year 1995.’’; and

9 (2) in subsection (b)—

10 (A) in the heading, by striking ‘‘SET11 ASIDES’’ and inserting ‘‘SET-ASIDE’’; and

12 (B) by striking the second sentence.

13 (i) REPEAL.—Section 520(k) of the Cranston-Gon14 zalez National Affordable Housing Act (42 U.S.C. 11908)

15 is hereby repealed.

16 (j) TECHNICAL ASSISTANCE.—The Public and As17 sisted Housing Drug Elimination Act of 1990 (42 U.S.C.

18 11901 et seq.) is further amended by adding at the end

19 the following new section:

20 ‘‘SEC. 5131. TECHNICAL ASSISTANCE.

21 ‘‘Of the amounts appropriated annually for each of

22 fiscal years 1994 and 1995 to carry out this chapter, the

23 Secretary shall use not more than $10,000,000, directly

24 or indirectly, under grants, contracts, or cooperative

25 agreements, to provide training, information services, and
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1 other technical assistance to public housing agencies and

2 other entities with respect to their participation in the pro3 gram authorized by this chapter. Such technical assistance

4 may include the establishment and operation of the clear5 inghouse on drug abuse in public housing and the regional

6 training program on drug abuse in public housing under

7 sections 5143 and 5144 of this Act. The Secretary is also

8 authorized to use the foregoing amounts for obtaining as9 sistance in establishing and managing assessment and

10 evaluation criteria and specifications, and obtaining the

11 opinions of experts in relevant fields.’’.

12 TITLE III—TECHNICAL AND

13 OTHER AMENDMENTS

14 Subtitle A—Public and Assisted

15 Housing

16 SEC. 301. CORRECTION TO DEFINITION OF FAMILY.

17 The first sentence of section 3(b)(3)(B) of the United

18 States Housing Act of 1937 (42 U.S.C. 1437a(b)(3)(B))

19 is amended—

20 (1) by striking ‘‘means’’ and inserting ‘‘in21 cludes’’; and

22 (2) by inserting ‘‘and’’ immediately after ‘‘chil23 dren,’’.
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1 SEC. 302. IDENTIFICATION OF CIAP REPLACEMENT NEEDS.

2 Section 14 of the United States Housing Act of 1937

3 (42 U.S.C. 1437l) is amended—

4 (1) in subsection (d)—

5 (A) by striking paragraph (2); and

6 (B) in paragraph (4)—

7 (i) by striking ‘‘and replacements,’’;

8 and

9 (ii) by striking ‘‘(1), (2), and (3)’’ and

10 inserting ‘‘(1) and (3)’’; and

11 (2) in subsection (f)(1)—

12 (A) by striking subparagraph (B); and

13 (B) in subparagraph (D), by striking ‘‘(1),

14 (2), and (3)’’ and inserting ‘‘(1) and (3)’’.

15 SEC. 303. APPLICABILITY OF PUBLIC HOUSING AMEND16 MENTS TO INDIAN HOUSING.

17 (a) AMENDMENT.—Section 201(b) of the United

18 States Housing Act of 1937 (42 U.S.C. 1437aa(b)) is

19 amended to read as follows:

20 ‘‘(b) APPLICABILITY OF TITLE I.—Except as other21 wise provided by law, the provisions of title I shall apply

22 to low-income housing developed or operated pursuant to

23 a contract between the Secretary and an Indian housing

24 authority.’’.

25 (b) APPLICABILITY OF AMENDMENT.—The amend26 ment made by subsection (a) shall not affect provisions
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1 of the United States Housing Act of 1937 that were made

2 applicable to public housing developed or operated pursu3 ant to a contract between the Secretary and an Indian

4 housing authority in accordance with section 201(b)(2) of

5 such Act, as such section existed before the effective date

6 of this section.

7 (c) APPLICABILITY OF HOUSING AND COMMUNITY

8 DEVELOPMENT ACT OF 1992.—Sections 103(a)(1), 112,

9 114, 116, 118, 903, and 927 of the Housing and Commu10 nity Development Act of 1992 shall apply to public hous11 ing developed or operated pursuant to a contract between

12 the Secretary and an Indian housing authority.

13 SEC. 304. PROJECT-BASED ACCOUNTING.

14 Section 6(c)(4)(E) of the United States Housing Act

15 of 1937 (42 U.S.C. 1437d(c)(4)(E)) is amended by strik16 ing ‘‘250’’ and inserting ‘‘500’’.

17 SEC. 305. OPERATING SUBSIDY ADJUSTMENTS FOR ANTICI18 PATED FRAUD RECOVERIES.

19 Section 9(a) of the United States Housing Act of

20 1937 (42 U.S.C. 1437g(a)) is amended by adding at the

21 end the following new paragraph:

22 ‘‘(4) Adjustments to a public housing agency’s oper23 ating subsidy made by the Secretary under this section

24 shall reflect actual changes in rental income collections re25 sulting from the application of section 904 of the Stewart
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1 B. McKinney Homeless Assistance Amendments Act of

2 1988.’’.

3 SEC. 306. TECHNICAL ASSISTANCE FOR LEAD HAZARD RE4 DUCTION GRANTEES.

5 Section 1011(g) of the Housing and Community De6 velopment Act of 1992 (42 U.S.C. 5318 note) is hereby

7 repealed.

8 SEC. 307. ENVIRONMENTAL REVIEW IN CONNECTION WITH

9 GRANTS FOR LEAD-BASED PAINT HAZARD RE10 DUCTION.

11 Section 1011 of the Housing and Community Devel12 opment Act of 1992 (42 U.S.C. 5318 note) is amended—

13 (1) by redesignating subsection (o) as sub14 section (p); and

15 (2) by adding after subsection (n) the following

16 new subsection:

17 ‘‘(o) ENVIRONMENTAL REVIEW.—

18 ‘‘(1) IN GENERAL.—For purposes of environ19 mental review, decisionmaking, and action pursuant

20 to the National Environmental Policy Act of 1960

21 and other provisions of law that further the purposes

22 of such Act, a grant under this section shall be

23 treated as assistance under the HOME Investment

24 Partnership Act, established under title II of the

25 Cranston-Gonzalez National Affordable Housing
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1 Act, and shall be subject to the regulations promul2 gated by the Secretary to implement section 288 of

3 such Act.

4 ‘‘(2) APPLICABILITY.—This subsection shall

5 apply to—

6 ‘‘(A) grants awarded under this section;

7 and

8 ‘‘(B) grants awarded to States and units

9 of general local government for the abatement

10 of significant lead-based paint and lead dust

11 hazards in low- and moderate-income owner-oc12 cupied units and low-income privately owned

13 rental units pursuant to title II of the Depart14 ments of Veterans Affairs and Housing and

15 Urban Development, and Independent Agencies

16 Appropriations Act, 1992 (Public Law 102–

17 139, 105 Stat. 736).’’.

18 SEC. 308. FIRE SAFETY IN FEDERALLY ASSISTED HOUSING.

19 Section 31(c)(2)(A)(i) of the Federal Fire Prevention

20 and Control Act of 1974 (15 U.S.C. 2227(c)(2)(A)(i)) is

21 amended by adding ‘‘(or equivalent level of safety)’’ after

22 ‘‘system’’.

23 SEC. 309. SECTION 23 CONVERSION PROJECTS.

24 (a) SECTION 23 CONVERSION.—
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1 (1) AUTHORIZATION.—Notwithstanding con2 tracts entered into pursuant to section 14(b)(2) of

3 the United States Housing Act of 1937, the Sec4 retary is authorized to enter into obligations for con5 version of Leonard Terrace Apartments in Grand

6 Rapids, Michigan, from a leased housing contract

7 under section 23 of such Act to a project-based rent8 al assistance contract under section 8 of such Act.

9 (2) REPAYMENT REQUIRED.—The authorization

10 made in paragraph (1) is conditioned on the repay11 ment to the Secretary of all amounts received by the

12 public housing agency under the comprehensive im13 provement assistance program under section 14 of

14 the United States Housing Act of 1937 for the

15 Leonard Terrace Apartment project and the

16 amounts, as determined by the Secretary, received

17 by the public housing agency under the formula in

18 section 14(k) of such Act by reason of the project.

19 (b) CONTRACT RENEWAL.—

20 (1) IN GENERAL.—Leased housing contracts

21 under section 23 of the United States Housing Act

22 of 1937, as such section existed before the date of

23 enactment of the Housing and Community Develop24 ment Act of 1974, that—
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1 (A) were converted to section 8 contracts

2 on terms similar to or the same as the terms

3 of the section 8 new construction program; and

4 (B) expire during fiscal year 1994 or

5 1995;

6 shall be extended for a period not to exceed 5 years

7 as if the rents on such projects were established

8 under the section 8 new construction program, ex9 cept that section 8(c)(2)(C) of the United States

10 Housing Act of 1937 shall not apply to such con11 tracts.

12 (2) BUDGET COMPLIANCE.—To the extent that

13 paragraph (1) results in additional costs under this

14 section, such paragraph shall be effective only to the

15 extent that amounts to cover such additional costs

16 are provided in advance in appropriation Acts.

17 SEC. 310. INDEMNIFICATION OF CONTRACTORS FOR INTEL18 LECTUAL PROPERTY RIGHTS DISPUTES.

19 A recipient of Federal housing assistance may not use

20 such funds to indemnify contractors or subcontractors

21 against costs associated with litigating or settling disputes

22 concerning the infringement of intellectual property rights.
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1 SEC. 311. ASSUMPTION OF ENVIRONMENTAL REVIEW RE2 SPONSIBILITIES UNDER UNITED STATES

3 HOUSING ACT OF 1937 PROGRAMS.

4 Title I of the United States Housing Act of 1937 (42

5 U.S.C. 1437 et seq.) is amended by adding at the end

6 the following new section:

7 ‘‘SEC. 26. ENVIRONMENTAL REVIEWS.

8 ‘‘(a) IN GENERAL.—

9 ‘‘(1) RELEASE OF FUNDS.—In order to assure

10 that the policies of the National Environmental Pol11 icy Act of 1969 and other provisions of law which

12 further the purposes of such Act (as specified in reg13 ulations issued by the Secretary) are most effectively

14 implemented in connection with the expenditure of

15 funds under this title, and to assure to the public

16 undiminished protection of the environment, the Sec17 retary may, under such regulations, in lieu of the en18 vironmental protection procedures otherwise applica19 ble, provide for the release of funds for projects or

20 activities under this title, as specified by the Sec21 retary upon the request of a public housing agency

22 under this section, if the State or unit of general

23 local government, as designated by the Secretary in

24 accordance with regulations, assumes all of the re25 sponsibilities for environmental review, decisionmak26 ing, and action pursuant to such Act, and such other
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1 provisions of law as the regulations of the Secretary

2 may specify, which would otherwise apply to the Sec3 retary with respect to the release of funds.

4 ‘‘(2) IMPLEMENTATION.—The Secretary, after

5 consultation with the Council on Environmental

6 Quality, shall issue such regulations as may be nec7 essary to carry out this section. Such regulations

8 shall specify the programs to be covered.

9 ‘‘(b) PROCEDURE.—The Secretary shall approve the

10 release of funds subject to the procedures authorized by

11 this section only if, not less than 15 days prior to such

12 approval and prior to any commitment of funds to such

13 projects or activities, the public housing agency has sub14 mitted to the Secretary a request for such release accom15 panied by a certification of the State or unit of general

16 local government which meets the requirements of sub17 section (c). The Secretary’s approval of any such certifi18 cation shall be deemed to satisfy the Secretary’s respon19 sibilities under the National Environmental Policy Act of

20 1969 and such other provisions of law as the regulations

21 of the Secretary specify insofar as those responsibilities

22 relate to the release of funds which are covered by such

23 certification.

24 ‘‘(c) CERTIFICATION.—A certification under the pro25 cedures authorized by this section shall—
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1 ‘‘(1) be in a form acceptable to the Secretary;

2 ‘‘(2) be executed by the chief executive officer

3 or other officer of the State or unit of general local

4 government who qualifies under regulations of the

5 Secretary;

6 ‘‘(3) specify that the State or unit of general

7 local government under this section has fully carried

8 out its responsibilities as described under subsection

9 (a); and

10 ‘‘(4) specify that the certifying officer—

11 ‘‘(A) consents to assume the status of a re12 sponsible Federal official under the National

13 Environmental Policy Act of 1969 and agrees

14 to comply with each provision of law specified

15 in regulations issued by the Secretary insofar as

16 the provisions of such Act or other such provi17 sion of law apply pursuant to subsection (a);

18 and

19 ‘‘(B) is authorized and consents on behalf

20 of the State or unit of general local government

21 and himself or herself to accept the jurisdiction

22 of the Federal courts for the purpose of en23 forcement of his or her responsibilities as such

24 an official.
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1 ‘‘(d) APPROVAL BY STATES.—In cases in which a

2 unit of general local government carries out the respon3 sibilities described in subsection (c), the Secretary may

4 permit the State to perform those actions of the Secretary

5 described in subsection (b) and the performance of such

6 actions by the State, where permitted by the Secretary,

7 shall be deemed to satisfy the Secretary’s responsibilities

8 referred to in the second sentence of subsection (b).’’.

9 SEC. 312. INCREASED STATE FLEXIBILITY IN THE LOW-IN10 COME HOME ENERGY ASSISTANCE PROGRAM.

11 Section 927 of the Housing and Community Develop12 ment Act of 1992 (42 U.S.C. 8624) is amended—

13 (1) in subsection (a)—

14 (A) in the heading, by striking ‘‘(a) ELIGI15 BILITY.—’’ and inserting the following:

16 ‘‘(a) IN GENERAL.—’’;

17 (B) by striking ‘‘(including but not limited

18 to the Low-Income Home Energy Assistance

19 Program)’’; and

20 (C) by inserting ‘‘, except as provided in

21 subsection (d)’’ before the period at the end;

22 (2) in subsection (b)—

23 (A) by striking ‘‘such’’ and inserting ‘‘or

24 receiving energy’’; and
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1 (B) by inserting before the period at the

2 end ‘‘for any program in which eligibility or

3 benefits are based on need, except as provided

4 in subsection (d)’’; and

5 (3) by adding at the end the following new sub6 section:

7 ‘‘(d) SPECIAL RULE FOR LOW-INCOME HOME EN8 ERGY ASSISTANCE PROGRAM.—For purposes of the Low9 Income Home Energy Assistance Program, tenants de10 scribed in subsection (a)(2) shall not have their eligibility

11 automatically denied. States may consider the amount of

12 the heating or cooling component of utility allowances re13 ceived by such tenants when setting benefit levels under

14 the Low-Income Home Energy Assistance Program. Any

15 reduction in fuel assistance benefits must be reasonably

16 related to the amount of the heating or cooling component

17 of the utility allowance received. States shall ensure that

18 the highest level of assistance will be provided to those

19 households with the highest energy burdens, in accordance

20 with section 2605(b)(5) of the Low-Income Home Energy

21 Assistance Act of 1981.’’.
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1 Subtitle B—Multifamily Housing

2 SEC. 321. CORRECTION OF MULTIFAMILY MORTGAGE LIM3 ITS.

4 The National Housing Act (12 U.S.C. 1701 et seq.)

5 is amended in sections 207(c)(3), 213(b)(2),

6 220(d)(3)(B)(iii), and 234(e)(3) by striking ‘‘$59,160’’

7 each place it appears and inserting ‘‘$56,160’’.

8 SEC. 322. FHA MULTIFAMILY RISK-SHARING; HFA PILOT

9 PROGRAM AMENDMENTS.

10 (a) IN GENERAL.—Section 542(c) of the Housing

11 and Community Development Act of 1992 (12 U.S.C.

12 1707 note) is amended—

13 (1) in paragraph (1), by inserting after ‘‘quali14 fied housing finance agencies’’ the following: ‘‘(in15 cluding entities established by States that provide

16 mortgage insurance)’’;

17 (2) in paragraph (2)—

18 (A) in subparagraph (C), by striking the

19 last sentence and inserting the following: ‘‘Such

20 agreements shall specify that the qualified

21 housing finance agency and the Secretary shall

22 share any loss in accordance with the risk-shar23 ing agreement.’’; and

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

25 subparagraph:
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1 ‘‘(F) DISCLOSURE OF RECORDS.—Quali2 fied housing finance agencies shall make avail3 able to the Secretary such financial and other

4 records as the Secretary deems necessary for

5 program review and monitoring purposes.’’;

6 (3) in paragraph (7)—

7 (A) by striking ‘‘very low-income’’; and

8 (B) by striking ‘‘(2)’’; and

9 (4) by adding at the end the following new

10 paragraphs:

11 ‘‘(9) ENVIRONMENTAL AND OTHER REVIEWS.—

12 ‘‘(A) ENVIRONMENTAL REVIEWS.—

13 ‘‘(i) IN GENERAL.—(I) In order to as14 sure that the policies of the National Envi15 ronmental Policy Act of 1969 and other

16 provisions of law which further the pur17 poses of such Act (as specified in regula18 tions issued by the Secretary) are most ef19 fectively implemented in connection with

20 the insurance of mortgages under sub21 section (c)(2), and to assure to the public

22 undiminished protection of the environ23 ment, the Secretary may, under such regu24 lations, in lieu of the environmental protec25 tion procedures otherwise applicable, pro-
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1 vide for agreements to endorse for insur2 ance mortgages under subsection (c)(2)

3 upon the request of qualified housing fi4 nance agencies under this subsection, if the

5 State or unit of general local government,

6 as designated by the Secretary in accord7 ance with regulations, assumes all of the

8 responsibilities for environmental review,

9 decisionmaking, and action pursuant to

10 such Act, and such other provisions of law

11 as the regulations of the Secretary may

12 specify, that would otherwise apply to the

13 Secretary with respect to the insurance of

14 mortgages on particular properties.

15 ‘‘(II) The Secretary shall issue regula16 tions to carry out this subparagraph only

17 after consultation with the Council on En18 vironmental Quality. Such regulations

19 shall, among other matters, provide—

20 ‘‘(aa) for the monitoring of the

21 performance of environmental reviews

22 under this subparagraph;

23 ‘‘(bb) subject to the discretion of

24 the Secretary, for the provision or fa-
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1 cilitation of training for such perform2 ance; and

3 ‘‘(cc) subject to the discretion of

4 the Secretary, for the suspension or

5 termination by the Secretary of the

6 qualified housing finance agency’s re7 sponsibilities under subclause (I).

8 ‘‘(III) The Secretary’s duty under

9 subclause (II) shall not be construed to

10 limit any responsibility assumed by a State

11 or unit of general local government with

12 respect to any particular property under

13 subclause (I).

14 ‘‘(ii) PROCEDURE.—The Secretary

15 shall approve a mortgage for the provision

16 of mortgage insurance subject to the proce17 dures authorized by this paragraph only if,

18 not less than 15 days prior to such ap19 proval, prior to any approval, commitment,

20 or endorsement of mortgage insurance on

21 the property on behalf of the Secretary,

22 and prior to any commitment by the quali23 fied housing finance agency to provide fi24 nancing under the risk-sharing agreement

25 with respect to the property, the qualified
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1 housing finance agency submits to the Sec2 retary a request for such approval, accom3 panied by a certification of the State or

4 unit of general local government that

5 meets the requirements of clause (iii). The

6 Secretary’s approval of any such certifi7 cation shall be deemed to satisfy the Sec8 retary’s responsibilities under the National

9 Environmental Policy Act of 1969 and

10 such other provisions of law as the regula11 tions of the Secretary specify insofar as

12 those responsibilities relate to the provision

13 of mortgage insurance on the property that

14 is covered by such certification.

15 ‘‘(iii) CERTIFICATION.—A certification

16 under the procedures authorized by this

17 paragraph shall—

18 ‘‘(I) be in a form acceptable to

19 the Secretary;

20 ‘‘(II) be executed by the chief ex21 ecutive officer or other officer of the

22 State or unit of general local govern23 ment who qualifies under regulations

24 of the Secretary;
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1 ‘‘(III) specify that the State or

2 unit of general local government

3 under this section has fully carried

4 out its responsibilities as described

5 under clause (i); and

6 ‘‘(IV) specify that the certifying

7 officer consents to assume the status

8 of a responsible Federal official under

9 the National Environmental Policy

10 Act of 1969 and under each provision

11 of law specified in regulations issued

12 by the Secretary insofar as the provi13 sions of such Act or such other provi14 sions of law apply pursuant to clause

15 (i), and is authorized and consents on

16 behalf of the State or unit of general

17 local government and himself or her18 self to accept the jurisdiction of the

19 Federal courts for the purpose of en20 forcement of the responsibilities as

21 such an official.

22 ‘‘(iv) APPROVAL BY STATES.—In

23 cases in which a unit of general local gov24 ernment carries out the responsibilities de25 scribed in clause (i), the Secretary may
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1 permit the State to perform those actions

2 of the Secretary described in clause (ii)

3 and the performance of such actions by the

4 State, where permitted by the Secretary,

5 shall be deemed to satisfy the Secretary’s

6 responsibilities referred to in the second

7 sentence of clause (ii).

8 ‘‘(B) LEAD-BASED PAINT POISONING PRE9 VENTION.—In carrying out the requirements of

10 section 302 of the Lead-Based Paint Poisoning

11 Prevention Act, the Secretary may provide by

12 regulation for the assumption of all or part of

13 the Secretary’s duties under such Act by quali14 fied housing finance agencies, for purposes of

15 this section.

16 ‘‘(C) CERTIFICATION OF SUBSIDY

17 LAYERING COMPLIANCE.—The requirements of

18 section 102(d) of the Department of Housing

19 and Urban Development Reform Act of 1989

20 may be satisfied in connection with a commit21 ment to insure a mortgage under this sub22 section by a certification by a housing credit

23 agency (including an entity established by a

24 State that provides mortgage insurance) to the

25 Secretary that the combination of assistance
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1 within the jurisdiction of the Secretary and

2 other government assistance provided in connec3 tion with a property for which a mortgage is to

4 be insured shall not be any greater than is nec5 essary to provide affordable housing.

6 ‘‘(10) DEFINITIONS.—For purposes of this sub7 section, the following definitions shall apply:

8 ‘‘(A) MORTGAGE.—The term ‘mortgage’

9 means a first mortgage on real estate that is—

10 ‘‘(i) owned in fee simple; or

11 ‘‘(ii) subject to a leasehold interest

12 that—

13 ‘‘(I) has a term of not less than

14 99 years and is renewable; or

15 ‘‘(II) has a remaining term that

16 extends beyond the maturity of the

17 mortgage for a period of not less than

18 10 years.

19 ‘‘(B) FIRST MORTGAGE.—The term ‘first

20 mortgage’ means a single first lien given to se21 cure advances on, or the unpaid purchase price

22 of, real estate, under the laws of the State in

23 which the real estate is located, together with

24 the credit instrument, if any, secured thereby.

25 Any other financing permitted on property in-
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1 sured under this section must be expressly sub2 ordinate to the insured mortgage.

3 ‘‘(C) UNIT OF GENERAL LOCAL GOVERN4 MENT; STATE.—The terms ‘unit of general local

5 government’ and ‘State’ have the same mean6 ings as in section 102(a) of the Housing and

7 Community Development Act of 1974.’’.

8 (b) DEFINITION OF MULTIFAMILY HOUSING.—Sec9 tion 544(1) of the Housing and Community Development

10 Act of 1992 (12 U.S.C. 1707 note) is amended to read

11 as follows:

12 ‘‘(1) The term ‘multifamily housing’ means

13 housing accommodations on the mortgaged property

14 that are designed principally for residential use, con15 form to standards satisfactory to the Secretary, and

16 consist of not less than 5 rental units on 1 site.

17 These units may be detached, semidetached, row

18 house, or multifamily structures.’’.

19 SEC. 323. SUBSIDY LAYERING REVIEW.

20 Section 911 of the Housing and Community Develop21 ment Act of 1992 (42 U.S.C. 3545 note) is amended—

22 (1) by striking subsection (a) and inserting the

23 following:

24 ‘‘(a) CERTIFICATION OF SUBSIDY LAYERING COM25 PLIANCE.—The requirements of section 102(d) of the De-
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1 partment of Housing and Urban Development Reform Act

2 of 1989 may be satisfied in connection with a project re3 ceiving assistance under a program that is within the ju4 risdiction of the Department of Housing and Urban Devel5 opment and under section 42 of the Internal Revenue

6 Code of 1986 by a certification by a housing credit agency

7 to the Secretary, submitted in accordance with guidelines

8 established by the Secretary, that the combination of as9 sistance within the jurisdiction of the Secretary and other

10 government assistance provided in connection with a prop11 erty for which assistance is to be provided within the juris12 diction of the Department of Housing and Urban Develop13 ment and under section 42 of the Internal Revenue Code

14 of 1986 shall not be any greater than is necessary to pro15 vide affordable housing.’’; and

16 (2) by striking subsection (c) and inserting the

17 following:

18 ‘‘(c) REVOCATION BY SECRETARY.—If the Secretary

19 determines that a housing credit agency has failed to com20 ply with the guidelines established under subsection (a),

21 the Secretary—

22 ‘‘(1) may inform the housing credit agency that

23 the agency may no longer submit certification of

24 subsidy layering compliance under this section; and
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1 ‘‘(2) shall carry out section 102(d) of the Hous2 ing and Urban Development Reform Act relating to

3 affected projects allocated a low-income housing tax

4 credit pursuant to section 42 of the Internal Reve5 nue Code of 1986.’’.

6 Subtitle C—Miscellaneous and

7 Technical Amendments

8 SEC. 331. TECHNICAL CORRECTION TO RURAL HOUSING

9 PRESERVATION PROGRAM.

10 Section 515(c)(1) of the Housing Act of 1949 (42

11 U.S.C. 1485(c)(1)) is amended by striking ‘‘December 21,

12 1979’’ and inserting ‘‘December 15, 1989’’.

13 SEC. 332. CDBG TECHNICAL AMENDMENT.

14 Notwithstanding any other provision of law, the city

15 of Slidell, Louisiana may submit, not later than 10 days

16 following the enactment of this Act, and the Secretary of

17 Housing and Urban Development shall consider and ac18 cept, the final statement of community development objec19 tives and projected use of funds required by section

20 104(a)(1) of the Housing and Community Development

21 Act of 1974 in connection with a grant to the city of Sli22 dell under title 1 of such Act for fiscal year 1994.

23 SEC. 333. ENVIRONMENTAL REVIEW IN CONNECTION WITH

24 SPECIAL PROJECTS.

25 (a) IN GENERAL.—
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1 (1) RELEASE OF FUNDS.—In order to assure

2 that the policies of the National Environmental Pol3 icy Act of 1969 and other provisions of law which

4 further the purposes of such Act (as specified in reg5 ulations issued by the Secretary) are most effectively

6 implemented in connection with the expenditure of

7 funds for special projects appropriated under an ap8 propriations Act for the Department of Housing and

9 Urban Development, such as special projects under

10 the head ‘‘Annual Contributions for Assisted Hous11 ing’’ in title II of the Departments of Veterans Af12 fairs and Housing and Urban Development, and

13 Independent Agencies Appropriations Act, 1993, and

14 to assure to the public undiminished protection of

15 the environment, the Secretary of Housing and

16 Urban Development may, under such regulations, in

17 lieu of the environmental protection procedures oth18 erwise applicable, provide for the release of funds for

19 particular special projects upon the request of recipi20 ents of special projects assistance, if the State or

21 unit of general local government, as designated by

22 the Secretary in accordance with regulations, as23 sumes all of the responsibilities for environmental

24 review, decisionmaking, and action pursuant to such

25 Act, and such other provisions of law as the regula-
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1 tions of the Secretary specify, that would otherwise

2 apply to the Secretary were the Secretary to under3 take such special projects as Federal projects.

4 (2) IMPLEMENTATION.—The Secretary shall

5 issue regulations to carry out this section only after

6 consultation with the Council on Environmental

7 Quality. Such regulations shall—

8 (A) provide for monitoring of the perform9 ance of environmental reviews under this sec10 tion;

11 (B) in the discretion of the Secretary, pro12 vide for the provision or facilitation of training

13 for such performance; and

14 (C) subject to the discretion of the Sec15 retary, provide for suspension or termination by

16 the Secretary of the assumption under para17 graph (1).

18 (3) RESPONSIBILITIES OF STATE OR UNIT OF

19 GENERAL LOCAL GOVERNMENT.—The Secretary’s

20 duty under paragraph (2) shall not be construed to

21 limit any responsibility assumed by a State or unit

22 of general local government with respect to any par23 ticular release of funds under paragraph (1).

24 (b) PROCEDURE.—The Secretary shall approve the

25 release of funds for projects subject to the procedures au-
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1 thorized by this section only if, not less than 15 days prior

2 to such approval and prior to any commitment of funds

3 to such projects, the recipient submits to the Secretary

4 a request for such release, accompanied by a certification

5 of the State or unit of general local government which

6 meets the requirements of subsection (c). The Secretary’s

7 approval of any such certification shall be deemed to sat8 isfy the Secretary’s responsibilities under the National En9 vironmental Policy Act of 1969 and such other provisions

10 of law as the regulations of the Secretary specify insofar

11 as those responsibilities relate to the releases of funds for

12 special projects to be carried out pursuant thereto which

13 are covered by such certification.

14 (c) CERTIFICATION.—A certification under the proce15 dures authorized by this section shall—

16 (1) be in a form acceptable to the Secretary;

17 (2) be executed by the chief executive officer or

18 other officer of the State or unit of general local

19 government who qualifies under regulations of the

20 Secretary;

21 (3) specify that the State or unit of general

22 local government under this section has fully carried

23 out its responsibilities as described under subsection

24 (a); and

25 (4) specify that the certifying officer—
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1 (A) consents to assume the status of a re2 sponsible Federal official under the National

3 Environmental Policy Act of 1969 and agrees

4 to comply with each provision of law specified

5 in regulations issued by the Secretary insofar as

6 the provisions of such Act or other such provi7 sion of law apply pursuant to subsection (a);

8 and

9 (B) is authorized and consents on behalf of

10 the State or unit of general local government

11 and himself or herself to accept the jurisdiction

12 of the Federal courts for the purpose of en13 forcement of the responsibilities as such an offi14 cial.

15 (d) APPROVAL BY STATES.—In cases in which a unit

16 of general local government carries out the responsibilities

17 described in subsection (a), the Secretary may permit the

18 State to perform those actions of the Secretary described

19 in subsection (b) and the performance of such actions by

20 the State, where permitted by the Secretary, shall be

21 deemed to satisfy the Secretary’s responsibilities referred

22 to in the second sentence of subsection (b).
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1 TITLE IV—GENERAL

2 PROVISIONS

3 SEC. 401. MOUNT RUSHMORE COMMEMORATIVE COIN ACT.

4 (a) DISTRIBUTION OF SURCHARGES.—Section 8 of

5 the Mount Rushmore Commemorative Coin Act (31

6 U.S.C. 5112 note) is amended by striking paragraphs (1)

7 and (2) and inserting the following:

8 ‘‘(1) the first $18,750,000 shall be paid during

9 fiscal year 1994 by the Secretary to the Society to

10 assist the Society’s efforts to improve, enlarge, and

11 renovate the Mount Rushmore National Memorial;

12 and

13 ‘‘(2) the remainder shall be returned to the

14 United States Treasury for purposes of reducing the

15 national debt.’’.

16 (b) RETROACTIVE EFFECT.—If, prior to the date of

17 enactment of this Act, any amount of surcharges have

18 been received by the Secretary of the Treasury and paid

19 into the United States Treasury pursuant to section 8(1)

20 of the Mount Rushmore Commemorative Coin Act, as in

21 effect prior to the date of enactment of this Act, that

22 amount shall be paid out of the Treasury to the extent

23 necessary to comply with section 8(1) of the Mount Rush24 more Commemorative Coin Act, as in effect after the date

25 of enactment of this Act. Amounts paid pursuant to the
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1 preceding sentence shall be out of funds not otherwise ap2 propriated.

3 SEC. 402. MINORITY COMMUNITY DEVELOPMENT GRANTS

4 FOR COMMUNITIES WITH SPECIAL NEEDS.

5 (a) AUTHORIZATION.—There are hereby authorized

6 to be expended from sums appropriated for water infra7 structure financing and other wastewater activities for

8 cities with special needs, not more than $25,000,000, for

9 wastewater treatment projects, including the construction

10 of facilities and related expenses in minority communities

11 with special needs to—

12 (1) improve the housing stock infrastructure in

13 the special needs communities; and

14 (2) abate health hazards caused by groundwater

15 contamination from septage in arid areas with high

16 groundwater levels.

17 (b) TREATMENT PROJECTS.—The wastewater treat18 ment projects authorized under this section shall include

19 innovative technologies such as vacuum systems and con20 structed wetlands.

21 (c) DEFINITIONS.—For purposes of this section—

22 (1) the term ‘‘cities with special needs’’ includes

23 minority communities with special needs;
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1 (2) the term ‘‘minority’’ means an African2 American, a Hispanic-American, an Asian-American,

3 or a Native American; and

4 (3) the term ‘‘minority community with special

5 needs’’ means an unincorporated community—

6 (A) that, based on the latest census data,

7 has a minority population in excess of 50 per8 cent;

9 (B) that has been unable to issue bonds or

10 otherwise finance a wastewater treatment sys11 tem itself because its attempts to change its po12 litical subdivision have been rejected by the

13 State legislature; and

14 (C) for which the State legislature has ap15 propriated funds to help pay for a wastewater

16 treatment project.

Passed the Senate November 19 (legislative day, November 2), 1993.

Attest:

Secretary.
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