Calendar No. 275

103D CONGRESS

1ST SESSION S. 1299

[Report No. 103–174]

A BILL

To reform requirements for the disposition of mulNcrime, and for other purposes. gram flexibility, authorize a program to combat Housing and Urban Development, enhance pro- tifamily property owned by the Secretary of OVEMBER 9 (legislative day, NOVEMBER 2), 1993

Reported with an amendment
II

Calendar No. 275

103D CONGRESS

1ST SESSION S. 1299

[Report No. 103–174]

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.

IN THE SENATE OF THE UNITED STATES

JULY 28 (legislative day, JUNE 30), 1993

Mr. RIEGLE (for himself and Mr. SARBANES) (by request) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs

NOVEMBER 9 (legislative day, NOVEMBER 2), 1993

Reported by Mr. RIEGLE with an amendment

[Strike all after the enacting clause and insert the part printed in italic]

A BILL

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,
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1 SHORT TITLE AND TABLE OF CONTENTS

2 SECTION 1. (a) SHORT TITLE.—This Act may be

3 cited as the ‘‘Housing and Community Development Act

4 of 1993’’.

5 (b) TABLE OF CONTENTS.—

TITLE I—FHA MULTIFAMILY REFORMS

Sec. 101. Multifamily property disposition.

Sec. 102. Amend the requirement for State and local government right of first

refusal.

Sec. 103. Repeal State agency multifamily property disposition demonstration.

Sec. 104. Demonstration: RTC marketing and disposition of multifamily properties owned by HUD.

Sec. 105. Authorize civil money penalties against general partners and certain

managing agents of multifamily projects.

Sec. 106. Extend HUD review period for approval of management improvement

and operating plans.

Sec. 107. Use of flexible subsidy in preservation projects.

Sec. 108. Delete requirement to reduce interest rates to avoid foreclosure on assigned mortgages.

TITLE II—ENHANCE PROGRAM FLEXIBILITY

Subtitle A—Office of Public and Indian Housing

Sec. 201. Freeze fees for administration of the certificate and voucher programs.

Sec. 202. Revitalization of severely distressed public housing.

Sec. 203. Disallowance of earned income for residents who obtain employment.

Sec. 204. Ceiling rents based on reasonable rental value.

Subtitle B—Office of Community Planning and Development

Sec. 210. Economic revitalization initiative.

Sec. 211. HOME investment partnerships.

Sec. 212. Reduce HOPE 3 match requirement to 25 percent.

Subtitle C—Community Partnerships Against Crime

Sec. 220. COMPAC program.

TITLE III—TECHNICAL AND OTHER AMENDMENTS

Subtitle A—Public and Assisted Housing

Sec. 301. Correct the definition of family in the 1937 Act to clarify that families are not required to include children.

Sec. 302. Eliminate requirement for identification of CIAP replacement needs.

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

Sec. 304. Increase the unit threshold above which PHAs are required to adopt

project-based accounting.
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Subtitle B—Multifamily Housing

Sec. 310. Correct errors in multifamily mortgage limits.

Sec. 311. FHA multifamily risk-sharing HFA pilot program amendments.

Sec. 312. Subsidy layering review.

1 TITLE I—FHA MULTIFAMILY REFORMS

2 MULTIFAMILY PROPERTY DISPOSITION

3 SEC. 101. (a) SUBSIDIZED AND UNSUBSIDIZED

4 PROJECTS.—Section 203 of the Housing and Community

5 Development Amendments of 1978 is amended—

6 (1) in subsection (a)—

7 (A) by redesignating paragraphs (2)

8 through (6) as paragraphs (3) through (7), re9 spectively; and

10 (B) by striking paragraph (1) and insert11 ing in lieu thereof the following:

12 ‘‘(1) preserving so that they are available to

13 and affordable by low-income persons—

14 ‘‘(A) in the case of a subsidized or for15 merly subsidized multifamily housing project re16 ferred to in subsections (i)(2) (A) through (C),

17 all units in the project;

18 ‘‘(B) in the case of a subsidized or for19 merly subsidized project referred to in sub20 section (i)(2)(D), all units in the project that

21 are covered, or were covered immediately before

22 foreclosure or acquisition of the project by the
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1 Secretary, by an assistance contract under any

2 of the authorities referred to in such subsection;

3 ‘‘(C) in all other multifamily housing

4 projects, at least the units that are covered, or

5 were covered immediately before foreclosure or

6 acquisition of the project by the Secretary, by

7 a project-based assistance contract under—

8 ‘‘(i) section 8(b)(2) of the United

9 States Housing Act of 1937 (as such sec10 tion existed before October 1, 1983) (new

11 construction and substantial rehabilita12 tion); section 8(b) of such Act (property

13 disposition); section 8(d)(2) of such Act

14 (project-based certificates); section 8(e)(2)

15 of such Act (moderate rehabilitation); sec16 tion 23 of such Act (as in effect before

17 January 1, 1975); or section 101 of the

18 Housing and Urban Development Act of

19 1965 (rent supplements); or

20 ‘‘(ii) section 8 of the United States

21 Housing Act of 1937, following conversion

22 from such section 101;

23 ‘‘(2) in the case of multifamily housing projects

24 other than subsidized projects, providing project25 based rental assistance to units that were covered by
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1 an assistance contract under the Loan Management

2 Set-Aside program under section 8(b) of such Act

3 immediately before foreclosure or acquisition of the

4 project by the Secretary: Provided, That the assist5 ance shall be limited to—

6 ‘‘(A) tenants residing in the units imme7 diately before the foreclosure or acquisition; and

8 ‘‘(B) tenants initially admitted to units

9 under such contract that were vacant at the

10 time of the foreclosure or sale by HUD of the

11 project;

12 and such assistance shall not be provided to subse13 quent tenants;’’;

14 (2) in subsection (b)—

15 (A) in paragraph (1)—

16 (i) by striking ‘‘, including’’ and all

17 that follows through ‘‘persons,’’; and

18 (ii) by inserting ‘‘competent and’’ im19 mediately before ‘‘capable’’;

20 (B) by adding at the end thereof the fol21 lowing new paragraph:

22 ‘‘(3) to develop such procedures as the Sec23 retary determines necessary to obtain appropriate

24 community or resident input into disposition plans;

25 and’’;
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1 (3) by striking paragraph (1) of subsection (d)

2 and the introductory material preceding such para3 graph (1), and inserting in lieu thereof the following:

4 ‘‘In carrying out the goals specified in subsections

5 (a)(1) and (2), the Secretary shall take not less than

6 one of the following actions:

7 ‘‘(1) Enter into contracts under section 8 of the

8 United States Housing Act of 1937, to the extent

9 budget authority is available, with owners of multi10 family housing projects that are acquired by a pur11 chaser other than the Secretary at foreclosure or

12 after sale by the Secretary.

13 ‘‘(A)(i) In the case of a subsidized or for14 merly subsidized project referred to in sub15 sections (i)(2) (A) through (C), the contract

16 shall be for a term of at least 15 years and

17 shall be sufficient to assist at least all units

18 covered by an assistance contract under any of

19 the authorities referred to in subsection

20 (i)(2)(D). In order to make available to families

21 any of such units that are occupied by persons

22 not eligible for assistance under section 8, but

23 that subsequently become vacant, a contract

24 under this clause shall also provide that when

25 any such vacancy occurs, the owner shall lease
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1 the available unit to a family eligible for assist2 ance under section 8. The Secretary shall use

3 the authority contained in paragraph (3) in

4 connection with any unit in such projects that

5 does not receive project-based assistance under

6 this paragraph.

7 ‘‘(ii) In the case of a subsidized or for8 merly subsidized project referred to in sub9 section (i)(2)(D), the contract shall be for a

10 term of at least 15 years and shall be sufficient

11 to assist at least all units in the project that are

12 covered, or were covered immediately before

13 foreclosure or acquisition of the project by the

14 Secretary, by an assistance contract under any

15 of the authorities referred to in such subsection.

16 In order to make available to families any of

17 such units that are occupied by persons not eli18 gible for assistance under section 8, but that

19 subsequently become vacant, a contract under

20 this clause shall also provide that when any

21 such vacancy occurs, the owner shall lease the

22 available unit to a family eligible for assistance

23 under section 8.

24 ‘‘(iii) Contracts under clauses (i) and (ii)

25 shall be at contract rents that, consistent with
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1 subsection (a), provide for the necessary reha2 bilitation of such project and do not exceed

3 such percentage of the existing housing fair

4 market rents for the area (as determined by the

5 Secretary under section 8(c) of the United

6 States Housing Act of 1937) as the Secretary

7 may prescribe.

8 ‘‘(B) In all other multifamily housing

9 projects the contract shall be for an initial term

10 of at least five years and shall at least be suffi11 cient to provide project-based rental assistance

12 for all units—

13 ‘‘(i) that are covered, or were covered

14 immediately before foreclosure or acquisi15 tion of the project by the Secretary, by an

16 assistance contract under—

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

18 States Housing Act of 1937 (as such

19 section existed before October 1,

20 1983) (new construction and substan21 tial rehabilitation); section 8(b) prop22 erty disposition); section 8(d)(2) of

23 such Act (project-based certificates);

24 section 8(e)(2) of such Act (moderate

25 rehabilitation); section 23 of such Act
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1 (as in effect before January 1, 1975);

2 or section 101 of the Housing and

3 Urban Development Act of 1965 (rent

4 supplements); or

5 ‘‘(II) section 8 of the United

6 States Housing Act of 1937, following

7 conversion from such section 101; and

8 ‘‘(ii) that were covered by an assist9 ance contract under the Loan Management

10 Set-Aside program under section 8(b) of

11 such Act immediately before foreclosure or

12 acquisition of the project by the Secretary:

13 Provided, That the assistance shall be lim14 ited to—

15 ‘‘(I) tenants residing in the units

16 immediately before the foreclosure or

17 acquisition; and

18 ‘‘(II) tenants initially admitted to

19 units under such contract that were

20 vacant at the time of the foreclosure

21 or sale by HUD of the project;

22 and such assistance shall not be provided

23 to subsequent tenants.’’;

24 (4) by adding the following new paragraph at

25 the end of subsection (d):
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1 ‘‘(4) In connection with projects referred to in

2 paragraph (1), the Secretary is authorized to make

3 available tenant-based rental assistance under sec4 tion 8 (b) or (o) of such Act to very low-income fam5 ilies (as defined in section 3(b)(2) of the United

6 States Housing Act of 1937) that do not qualify for

7 project-based assistance under such paragraph.’’;

8 and

9 (5) in subsections (e) (3) and (4), by striking

10 ‘‘15-year period’’ and inserting in lieu thereof the

11 following: ‘‘the period of assistance’’.

12 (b) TENANT-BASED ASSISTANCE.—Section

13 203(d)(2) of such Act is amended—

14 (1) in the first sentence, by striking the par15 enthetical; and

16 (2) by adding at the end thereof the following

17 new sentence: ‘‘Actions pursuant to this paragraph

18 may be taken in connection with not more than 10

19 percent of the units in subsidized or formerly sub20 sidized projects owned by the Secretary.’’.

21 (c) ALTERNATE ASSISTANCE.—Section 203(d)(3) of

22 such Act is amended by striking ‘‘will ensure that,’’ and

23 all that follows through the end, and inserting in lieu

24 thereof the following: ‘‘will ensure that—
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1 ‘‘(A) the project is available to, and afford2 able by, low-income persons; and

3 ‘‘(B) for a period of not less than 15 years,

4 there shall be in force such use restrictions and

5 rent regulation as the Secretary may pre6 scribe.’’.

7 (d) NONRENTAL, NONRESIDENTIAL USE.—Section

8 203(d) of such Act, as amended by the previous provisions

9 of this section, is amended—

10 (1) by adding the following new paragraph at

11 the end thereof:

12 ‘‘(5)(A) Notwithstanding any other provision of

13 law, of the total number of units in multifamily

14 housing projects that are owned by the Secretary,

15 the Secretary may make up to—

16 ‘‘(i) 10 percent available for uses, other

17 than rental or cooperative use, such as low-in18 come homeownership opportunities, shelters for

19 the homeless, and office space for resident or

20 housing-related social service providers; and

21 ‘‘(ii) five percent available for any use, if

22 the Secretary, in consultation with the local or

23 areawide governing body, determines that such

24 action will assist efforts to deconcentrate low25 income housing opportunities.
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1 ‘‘(B) In connection with projects referred to in

2 subparagraph (A), the Secretary is authorized to

3 make available tenant-based rental assistance under

4 section 8 (b) or (o) of such Act to very low-income

5 families (as defined in section 3(b)(2) of the United

6 States Housing Act of 1937) to assist them in locat7 ing other decent, safe, and sanitary housing.’’; and

8 (2) in the last sentence of subsection (e)(1), by

9 striking ‘‘value’’ and all that follows through ‘‘(d)’’

10 and inserting in lieu thereof the following: ‘‘intended

11 use of the property after sale’’.

12 (e) DISPLACEMENT.—Sections 203(f)(2) (B) and (C)

13 are each amended by striking ‘‘above-moderate income’’

14 and inserting in lieu thereof ‘‘above low-income’’.

15 (f) SALE OF MORTGAGES ON UNSUBSIDIZED

16 PROJECTS.—Section 203(h) of such Act is amended by

17 adding at the end thereof the following new paragraph:

18 ‘‘(4) Notwithstanding any other provision of

19 law, the Secretary is authorized to sell mortgages

20 held on multifamily housing projects other than sub21 sidized projects on such terms and conditions as the

22 Secretary may prescribe.’’.

23 (g) DEFINITION OF ‘‘SUBSIDIZED PROJECT.’’—Sec24 tion 203(i) of such Act is amended—
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1 (1) in paragraph (1), by striking ‘‘or section

2 312 of the Housing Act of 1964’’;

3 (2) by striking subparagraph (C) of paragraph

4 (2) and renumbering the remaining subparagraphs

5 accordingly;

6 (3) in paragraph (2)(C), as redesignated by

7 paragraph (2) of this subsection, by striking ‘‘or to’’

8 and all that follows through ‘‘1964’’;

9 (4) by striking subparagraph (D) of paragraph

10 (2), as redesignated by paragraph (2) of this sub11 section, and inserting in lieu thereof the following

12 new subparagraph:

13 ‘‘(D)(i) rent supplement payments under

14 section 101 of the Housing and Urban Develop15 ment of 1965; (ii) housing assistance payments

16 made under section 23 of the United States

17 Housing Act of 1937 (as in effect before Janu18 ary 1, 1975); or (iii) housing assistance pay19 ments made under section 8 of the United

20 States Housing Act of 1937 (excluding pay21 ments made for certificates under subsection

22 (b)(1) or vouchers under subsection (o)), if (ex23 cept for purposes of paragraphs (1) and (2) of

24 subsection (h) and section 183(c) of the Hous25 ing and Community Development Act of 1987)
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1 such assistance payments are made to more

2 than 50 percent of the units in the project.’’;

3 and

4 (5) by striking paragraph (i)(4).

5 (h) OTHER PROVISIONS.—Section 203 of such Act is

6 amended by adding at the end thereof the following new

7 subsection:

8 ‘‘(k) In providing tenant-based assistance in connec9 tion with activities pursuant to subsection (d)(4) or

10 (d)(5)(B), the Secretary shall take into consideration the

11 condition of the local market in which the assistance will

12 be used and shall take such steps as the Secretary deems

13 necessary for the successful use of the assistance.’’.

14 (i) USE OF SAVINGS IN MANDATORY EXPENDI15 TURES.—(1) From amounts of savings in mandatory ex16 penditures that result from the amendments made by this

17 section, the Secretary shall—

18 (A) make grants to States and units of general

19 local government in a total amount of $400,000,000

20 for the rehabilitation of multifamily projects for21 merly owned by the Secretary that have been trans22 ferred to such governmental entities;

23 (B) transfer a sufficient number of multifamily

24 housing projects owned by the Secretary to States

25 and units of general local government to assure full
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1 use of the amount required for grants under sub2 paragraph (A); and

3 (C) require that the grantees comply with re4 quirements established by the Secretary governing

5 use of the project and the grant, including require6 ments governing use of the units for rental by low7 income families and affordability of rents, as deter8 mined by the Secretary.

9 The Secretary’s authority to make expenditures for grants

10 under this subparagraph shall terminate on September 30,

11 1994. The Secretary shall, by notice published in the Fed12 eral Register, establish such requirements as may be nec13 essary to carry out the provisions of this subparagraph,

14 including a requirement that States and units of general

15 local government do not earn arbitrage profits from these

16 grants.

17 (2) For purposes of this subsection—

18 (A) the term ‘‘low-income families’’ has the

19 meaning given such term in section 3(b)(2) of the

20 United States Housing Act of 1937;

21 (B) the term ‘‘Secretary’’ means the Secretary

22 of Housing and Urban Development;

23 (C) the term ‘‘State’’ has the meaning given

24 such term in section 104(2) of the Cranston-Gon25 zalez National Affordable Housing Act, including
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1 any agency or instrumentality thereof that is estab2 lished pursuant to legislation and designated by the

3 chief executive to act on behalf of the State with re4 gard to paragraph (1)(A); and

5 (D) the term ‘‘unit of general local govern6 ment’’ has the meaning given such term in section

7 104(1) of the Cranston-Gonzalez National Afford8 able Housing Act, including any agency or instru9 mentality thereof that is established pursuant to leg10 islation and designated by the chief executive to act

11 on behalf of the jurisdiction with regard to para12 graph (1)(A).

13 AMEND THE REQUIREMENT FOR STATE AND LOCAL

14 GOVERNMENT RIGHT OF FIRST REFUSAL

15 SEC. 102. (a) Section 203(e)(2) of the Housing and

16 Community Development Amendments of 1978 is amend17 ed to read as follows:

18 ‘‘(2) The Secretary, within 60 days of acquiring

19 title to a project, shall notify the unit of general

20 local government and the State housing finance

21 agency (or other agency or agencies designated by

22 the Governor) of the acquisition of such title. Within

23 60 days of this notice, the local government or des24 ignated State agency may submit to the Secretary a

25 preliminary expression of interest in the project. The

26 Secretary may take such actions as may be nec-
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1 essary to require the local government or designated

2 State agency to substantiate such interest. If the

3 local government or designated State agency has ex4 pressed interest within the 60-day period, and has

5 substantiated such interest if requested, upon ap6 proval of a disposition plan for a project, the Sec7 retary shall notify the local government and des8 ignated State agency of the terms and conditions of

9 the disposition plan and give the local government or

10 designated State agency 90 days from the date of

11 the notification to make an offer to purchase the

12 project. If the local govenment or designated State

13 agency does not express interest within the 60-day

14 period, or does not substantiate an expressed inter15 est if requested, the Secretary, upon approval of a

16 disposition plan, may offer the project for sale to

17 any interested person or entity.’’.

18 (b) Section 203(e)(3) of such Act is amended by

19 striking ‘‘The’’ in the first sentence and inserting ‘‘Where

20 the Secretary has given the local government or designated

21 State agency 90 days to make an offer to purchase the

22 project, the’’.

23 (c) Section 203(e) of such Act, as amended by sub24 sections (a) and (b), shall apply to projects that are ac25 quired on or after the effective date of this section. With
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1 respect to projects acquired before the effective date of

2 this section, the Secretary may apply—

3 (1) the requirements of sections 203 (e)(2) and

4 (e)(3) of such Act as they existed immediately before

5 the effective date of this section; or

6 (2) the requirements of section 203 (e)(2) and

7 (e)(3) of such Act, as amended by subsections (a)

8 and (b), respectively, if the Secretary gives the local

9 government and designated State agency 60 days to

10 express interest in the project, and for those that ex11 press interest within the 60-day period, and substan12 tiate such interest if requested, 90 days from the

13 date of notification of the terms and conditions of

14 the disposition plan to make an offer to purchase

15 the project.

16 REPEAL STATE AGENCY MULTIFAMILY PROPERTY

17 DISPOSITION DEMONSTRATION

18 SEC. 103. Section 184 of the Housing and Commu19 nity Development Act of 1987 is hereby repealed.

20 DEMONSTRATION: RTC MARKETING AND DISPOSITION OF

21 MULTIFAMILY PROPERTIES OWNED BY HUD

22 SEC. 104. (a) The Secretary of Housing and Urban

23 Development may carry out a demonstration with up to

24 50 multifamily properties owned by the Secretary, using

25 the Resolution Trust Corporation (RTC) for the market26 ing and disposition of the properties. Any such demonstra-
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1 tion shall be carried out by agreement of the RTC and

2 the Secretary on such terms and conditions as are accept3 able to the RTC and the Secretary. The RTC shall estab4 lish policies and procedures for marketing and disposition,

5 subject to review and approval by the Secretary.

6 (b) The Secretary may waive the requirements of sec7 tion 203 of the Housing and Community Development

8 Amendments of 1978 and any related requirements, in9 cluding restrictions on the incomes of families occupying

10 the units and requirements for continued assistance. The

11 Secretary may also waive any other statutory and regu12 latory requirements that apply to the project and that the

13 Secretary determines are not consistent with the purposes

14 of a demonstration, except that the Secretary may not

15 waive any equal opportunity or nondiscrimination statu16 tory or regulatory requirements or procedures.

17 (c) In determining which properties to include in the

18 demonstration, the Secretary shall take into consideration

19 the size of the inventory of properties owned by the Sec20 retary in the locality and such other factors as the Sec21 retary determines are appropriate.

22 (d) The Secretary shall reimburse the RTC for the

23 direct costs associated with the demonstration, including

24 the costs of administration and marketing, property man25 agement, and any repair and rehabilitation. The Secretary
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1 may use proceeds from the sale of the properties to reim2 burse the RTC for its costs.

3 (e) The demonstration under this section shall—

4 (1) be approved personally by the Secretary;

5 (2) taken as a whole over the life of the dem6 onstration, not result in higher costs to the Federal

7 Government;

8 (3) be generally consistent with the overall pur9 poses of the program or programs under which the

10 waiver is granted;

11 (4) be the subject of an evaluation plan for

12 which funding is obligated or set aside at the same

13 time the demonstration is approved and which will

14 be carried out by an independent party; the evalua15 tion shall include an assessment of the impact and

16 effectiveness of (A) any requirements waived pursu17 ant to subsection (b), and (B) any differences be18 tween the property disposition procedures of the

19 RTC and the Secretary; and

20 (5) be consistent with the Fair Housing Act,

21 title VI of the Civil Rights Act of 1964, section 504

22 of the Rehabilitation Act of 1973, and the Age Dis23 crimination Act of 1975.

24 (f) In approving the demonstration under this sec25 tion, the Secretary may impose such requirements as the
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1 Secretary considers to be appropriate to further its pur2 poses.

3 (g) The RTC shall submit an annual progress report

4 to the Secretary. The Secretary shall submit a report to

5 Congress within one year after completion of the dem6 onstration, describing the results of the demonstration and

7 making any recommendations for legislation.

8 (h) The demonstration under this section shall not

9 extend beyond the termination date of the Resolution

10 Trust Corporation.

11 (i) There is authorized to be appropriated $1,000,000

12 for the evaluation of the demonstration under this section.

13 AUTHORIZE CIVIL MONEY PENALTIES AGAINST GENERAL

14 PARTNERS AND CERTAIN MANAGING AGENTS OF

15 MULTIFAMILY PROJECTS

16 SEC. 105. (a) Section 537 of the National Housing

17 Act is amended—

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

19 ‘‘mortgagor’’ the second place it appears the follow20 ing: ‘‘or general partner of a partnership mortga21 gor’’;

22 (2) in the heading to subsection (c), by deleting

23 ‘‘VIOLATIONS OF REGULATORY AGREEMENT’’ and

24 inserting in lieu thereof the following: ‘‘OTHER VIO25 LATIONS’’;

26 (3) in subsection (c)(1)—
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1 (A) by deleting ‘‘any mortgagor of prop2 erty’’ and all that follows through ‘‘as follows:’’

3 and inserting in lieu thereof the following:

4 ‘‘(A) any mortgagor of property that in5 cludes five or more living units and that has a

6 mortgage insured, coinsured, or held pursuant

7 to this Act;

8 ‘‘(B) the general partner of a partnership

9 mortgagor;

10 ‘‘(C) any agent employed to manage the

11 property that has an identity of interest with

12 the general partner; or

13 ‘‘(D) any independent fee management en14 tity, under contract with the mortgagor or gen15 eral partner of a partnership mortgagor, that

16 fails to notify the Secretary, as required by the

17 Secretary, that it has been instructed by the

18 mortgagor or general partner of a partnership

19 mortgagor to engage in activities that are con20 trary to regulations and requirements of the

21 Secretary. A penalty may be imposed under this

22 section for knowingly and materially taking any

23 of the following actions:’’;

24 (B) by adding after subparagraph (L) the

25 following new subparagraphs:
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1 ‘‘(M) Failure, when there is adequate

2 project income available, to maintain the prem3 ises, accommodations, and the grounds and

4 equipment appurtenant thereto in good repair

5 and condition in accordance with regulations

6 and requirements of the Secretary.

7 ‘‘(N) Failure, by a general partner of a

8 partnership mortgagor, to provide management

9 for the project that is acceptable to the Sec10 retary pursuant to regulations and require11 ments of the Secretary.’’;

12 (C) in the last sentence, by deleting ‘‘of

13 such agreement’’ and inserting in lieu thereof

14 the following: ‘‘of this subsection’’; and

15 (D) by redesignating subparagraphs (A)

16 through (N) as clauses (i) through (xiv), respec17 tively;

18 (4) in subsection (d)(1)(B), by inserting after

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

20 partnership mortgagor, or agent employed to man21 age the property or independent fee management en22 tity as described in subsections (c)(1) (C) and (D),

23 respectively,’’;
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1 (5) in subsection (e)(1), by deleting ‘‘a mortga2 gor’’ and inserting in lieu thereof the following: ‘‘an

3 entity or person’’;

4 (6) in subsection (f), by inserting after ‘‘mort5 gagor’’ both times that it appears the following: ‘‘,

6 general partner of a partnership mortgagor, or agent

7 employed to manage the property or independent fee

8 management agent as described in subsections (c)(1)

9 (C) and (D), respectively,’’; and

10 (7) by amending the heading to read as follows:

11 ‘‘CIVIL MONEY PENALTIES AGAINST MULTIFAMILY

12 MORTGAGORS, GENERAL PARTNERS OF PARTNER13 SHIP MORTGAGORS, AND MANAGING AGENTS’’.

14 (b) The amendments made by subsection (a) shall

15 apply only with respect to—

16 (1) violations that occur on or after the effec17 tive date of this section; and

18 (2) in the case of a continuing violation (as de19 termined by the Secretary of Housing and Urban

20 Development), any portion of a violation that occurs

21 on or after such date.

22 EXTEND HUD REVIEW PERIOD FOR APPROVAL OF

23 MANAGEMENT IMPROVEMENT AND OPERATING PLANS

24 SEC. 106. Section 201(d)(6) of the Housing and

25 Community Development Amendments of 1978 is amend26 ed by striking ‘‘30’’ and inserting ‘‘120’’.
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1 USE OF FLEXIBLE SUBSIDY IN PRESERVATION PROJECTS

2 SEC. 107. (a) USE OF ASSISTANCE.—Section 201(k)

3 of the Housing and Community Development Amend4 ments of 1978 is amended by adding at the end thereof

5 the following new paragraph:

6 ‘‘(4) In providing, and contracting to provide,

7 assistance for capital improvements under this sec8 tion, the Secretary shall give priority to projects that

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

10 Emergency Low Income Housing Preservation Act

11 of 1987. The Secretary may make such assistance

12 available on a noncompetitive basis.’’.

13 (b) CERTAIN UNINSURED PROJECTS.—Section

14 201(n)(2) of such Act is amended by inserting a comma

15 immediately after ‘‘insured mortgages in force’’ and the

16 following: ‘‘projects for which the Secretary holds the

17 mortgage, and projects with respect to which the Secretary

18 makes interest reduction payments under section 236(o)

19 of the National Housing Act’’.

20 DELETE REQUIREMENT TO REDUCE INTEREST RATES TO

21 AVOID FORECLOSURE ON ASSIGNED MORTGAGES

22 SEC. 108. Section 7(i)(5) of the Department of Hous23 ing and Urban Development Act is amended by striking

24 out the first semicolon, and all that follows through ‘‘as

25 determined by the Secretary’’.
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1 TITLE II—ENHANCE PROGRAM FLEXIBILITY

2 Subtitle A—Office of Public and Indian Housing Freeze

3 Fees for Administration of the Certificate and

4 Voucher Programs

5 SEC. 201. Notwithstanding the second sentence of

6 section 8(q)(1) of the United States Housing Act of 1937,

7 other applicable law, and any implementing regulations

8 and related requirements, the fee for the ongoing costs

9 of administering the certificate and housing voucher pro10 grams under sections 8(b) and 8(o) of such Act for Fed11 eral fiscal year 1994 shall be based on the fair market

12 rents for Federal fiscal year 1993. However, the Secretary

13 may increase the fee in accordance with the third sentence

14 of section 8(q)(1) and sections 8(q)(2) (ii) and (iii) of such

15 Act.

16 REVITALIZATION OF SEVERELY DISTRESSED PUBLIC

17 HOUSING

18 SEC. 202. (a) SEVERELY DISTRESSED PUBLIC

19 HOUSING.—Section 24 of the United States Housing Act

20 of 1937 is amended as provided by this subsection.

21 (1) DELETE REQUIREMENT FOR DESIGNATION

22 OF ELIGIBLE PROJECTS.—

23 (A) Subsection (b) is hereby repealed.

24 (B) Subsection (i)(2) is hereby repealed

25 and the following paragraphs redesignated ac26 cordingly.
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1 (2) INCREASE PLANNING GRANT DOLLAR

2 CAP.—Subsection (c)(2) is amended by striking

3 ‘‘$200,000’’ and inserting ‘‘$500,000’’.

4 (3) PLANNING GRANT ELIGIBLE ACTIVITIES:

5 COMMUNITY SERVICE.—Subsection (c)(3) is amend6 ed by inserting the following new subparagraph after

7 subparagraph (D) and redesignating the following

8 subparagraphs accordingly:

9 ‘‘(E) planning for community service ac10 tivities to be carried out by residents, other

11 members of the community, and other persons

12 willing to contribute to the social, economic, or

13 physical improvement of the community (com14 munity service is a required element of the revi15 talization program);’’.

16 (4) PLANNING GRANT APPLICATION: COMMU17 NITY SERVICE.—Subsection (c)(4) is amended by in18 serting the following new subparagraph after sub19 paragraph (C) and redesignating the following sub20 paragraphs accordingly:

21 ‘‘(D) a description of the planning activi22 ties for community service to be carried out by

23 residents, other members of the community,

24 and other persons willing to contribute to the
28

•S 1299 RS

1 social, economic, or physical improvement of the

2 community;’’.

3 (5) IMPLEMENTATION GRANT ELIGIBLE ACTIVI4 TIES.—

5 (A) Subsection (d)(2) is amended by in6 serting the following new subparagraphs after

7 subparagraph (D) and redesignating the follow8 ing subparagraphs accordingly:

9 ‘‘(E) community service activities to be

10 carried out by residents, other members of the

11 community, and other persons willing to con12 tribute to the social, economic, or physical im13 provement of the community (community serv14 ice is a required element of the revitalization

15 program); and

16 ‘‘(F) replacement of public housing units,

17 when required under section 18, through the

18 use of implementation grant funds for the de19 velopment of replacement units provided

20 through the methods permitted under section

21 18(b)(3);’’.

22 (B) Subsection (d)(2)(K), as redesignated

23 by subparagraph (A) of this paragraph, is

24 amended by—
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•S 1299 RS

1 (i) striking ‘‘than 15 percent’’ and in2 serting ‘‘than 20 percent’’; and

3 (ii) inserting before the period the fol4 lowing: ‘‘and provided that an amount

5 equal to 15 percent of the amount of any

6 grant under this subsection used for sup7 port services shall be contributed from

8 non-Federal sources (this contribution

9 shall be in the form of cash, administrative

10 costs, and the reasonable value of in-kind

11 contributions and may include funding

12 under title I of the Housing and Commu13 nity Development Act of 1974)’’.

14 (6) IMPLEMENTATION GRANT APPLICATIONS:

15 COMMUNITY SERVICE.—Subsection (d)(3) is amend16 ed by inserting the following new subparagraph after

17 subparagraph (C) and redesignating the following

18 subparagraphs accordingly:

19 ‘‘(D) a description of the community serv20 ice activities to be carried out by residents,

21 other members of the community, and other

22 persons willing to contribute to the social, eco23 nomic, or physical improvement of the commu24 nity;’’.
30

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1 (7) PLANNING GRANT AND IMPLEMENTATION

2 GRANT SELECTION CRITERIA: NATIONAL GEO3 GRAPHIC DIVERSITY.—Subsections (c)(5) and (d)(4)

4 are each amended by—

5 (A) striking subparagraph (E) and redesig6 nating the following subparagraphs accordingly;

7 and

8 (B) inserting at the end the following new

9 flush matter:

10 ‘‘The Secretary may select a lower-rated, approvable

11 application over a higher-rated application to in12 crease the level of national geographic diversity of

13 applications approved under this section.’’.

14 (8) IMPLEMENTATION GRANT SELECTION CRI15 TERIA.—Subsection (d)(4)(D) is amended by strik16 ing ‘‘the potential of the applicant for developing a

17 successful and affordable’’ and inserting ‘‘the quality

18 of the proposed’’.

19 (9) DEFINITIONS.—(A) Subsection (h)(5) is

20 amended to read as follows:

21 ‘‘(5) SEVERELY DISTRESSED PUBLIC HOUS22 ING.—The term ‘severely distressed public housing’

23 means a public housing project or a building in a

24 project that—
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•S 1299 RS

1 ‘‘(A) requires major redesign, reconstruc2 tion, or redevelopment, or partial or total demo3 lition, to correct serious deficiencies in the

4 original design (including inappropriately high

5 population density), deferred maintenance,

6 physical deterioration or obsolescence of major

7 systems, and other deficiencies in the physical

8 plant of the project; and

9 ‘‘(B)(i)(I) is occupied predominantly by

10 families with children which have extremely low

11 incomes, high rates of unemployment, and ex12 tensive dependency on various forms of public

13 assistance; and

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

15 criminal activity (including drug-related crimi16 nal activity); or

17 ‘‘(ii) has a vacancy rate, as determined by

18 the Secretary, of 50 percent or more; and

19 ‘‘(C) cannot be revitalized through assist20 ance under other programs, such as the pro21 grams under sections 9 and 14, or through

22 other administrative means because of the inad23 equacy of available funds; and

24 ‘‘(D) in the case of individual buildings,

25 the building is, in the Secretary’s determina-
32

•S 1299 RS

1 tion, sufficiently separable from the remainder

2 of the project to make use of the building fea3 sible for purposes of this section.’’.

4 (B) Subsection (h) is amended by adding the

5 following new paragraphs at the end thereof:

6 ‘‘(6) COMMUNITY SERVICE.—The term ‘commu7 nity service’ means services provided on a volunteer

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

9 physical improvement of the community to be

10 served, including opportunity for the upward mobil11 ity of participants providing the community service,

12 through completion of education requirements, job

13 training, or alternative methods of developing skills

14 and job readiness.

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

16 services’ includes all activities designed to lead to17 ward upward mobility, self-sufficiency, and improved

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

19 as literacy training, job training, day care, and eco20 nomic development, and may include such activities

21 for residents of the neighborhood.’’.

22 (b) CONFORMING AMENDMENT.—The first sentence

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

24 1937 is amended to read as follows: ‘‘The term ‘eligible

25 housing’ means a public housing project, or one or more
33

•S 1299 RS

1 buildings within a project, that is owned or operated by

2 a troubled public housing agency.’’.

3 (c) COMPREHENSIVE GRANT AND DEVELOPMENT

4 GRANTS FOR REPLACEMENT HOUSING.—(1) Section

5 5(a)(2) of the United States Housing Act of 1937 is

6 amended by adding the following new sentence at the end

7 thereof: ‘‘In providing assistance under this paragraph,

8 the Secretary may give priority to public housing agencies

9 that use comprehensive grants under section 14(k) for re10 placement housing under section 18(b)(3)(A).’’

11 (2) Section 14 of such Act is amended by adding the

12 following new subsection at the end thereof:

13 ‘‘(q) The Secretary may authorize a public housing

14 agency to use assistance allocated to it for use under sub15 section (e) for the development of additional housing

16 under this Act, in accordance with requirements applicable

17 to the development of public housing, to provide replace18 ment housing as required by section 18.’’.

19 (d) USE OF TENANT-BASED ASSISTANCE FOR RE20 PLACEMENT HOUSING.—(1) Section 18(b)(3)(A) of such

21 Act is amended—

22 (A) by striking ‘‘or’’ at the end of clause (v);

23 (B) by redesignating clause (vi) as clause (vii);

24 and
34

•S 1299 RS

1 (C) by inserting the following new clause imme2 diately after clause (v):

3 ‘‘(vi) the use of five-year tenant-based as4 sistance under section 8(b) or (o) if—

5 ‘‘(I) the project has been vacant for a

6 period of at least five years;

7 ‘‘(II) the proposed demolition is nec8 essary for revitalization of the remaining

9 units in the project; or

10 ‘‘(III) demolition of the entire project

11 is proposed and some or all of the units

12 will be replaced on the site; or’’.

13 (2) Section 18(b)(3) of such Act is amended—

14 (A) in subparagraph (A)(v), by striking ‘‘to the

15 extent available’’ and all that follows through ‘‘5

16 years’’; and

17 (B) in subparagraph (C), by adding the follow18 ing new flush matter at the end thereof:

19 ‘‘Provided, That notwithstanding the other provisions of

20 this subparagraph, if the plan involves (I) a demolition

21 described in subparagraph (A)(vi) or (II) the demolition

22 of 200 or more units, tenant-based assistance under sec23 tion 8(b) or (o) may be approved if the public housing

24 agency determines, in accordance with such requirements

25 as the Secretary may prescribe, that such use is feasible
35

•S 1299 RS

1 and appropriate to meeting the low-income housing needs

2 in the community;’’.

3 (3) Section 18(c)(2) of such Act is amended by in4 serting before the period at the end of the first sentence

5 a comma and the following: ‘‘except for amounts to be pro6 vided from the allocation of comprehensive grant assist7 ance to the public housing agency under section 14’’.

8 (e) NEED FOR REPLACEMENT HOUSING.—The flush

9 matter at the end of section 18(b)(3) of such Act is

10 amended—

11 (1) by striking ‘‘except that,’’ and inserting in

12 lieu thereof the following: ‘‘except that (1)’’; and

13 (2) by inserting immediately before the period

14 at the end thereof the following: ‘‘, and (2) a public

15 housing agency may demolish public housing dwell16 ing units without providing an additional unit for

17 each unit to be demolished if there is no need for

18 additional assisted housing in the community, as de19 termined in accordance with criteria determined by

20 the Secretary’’.

21 (f) REPLACEMENT HOUSING OUTSIDE THE JURIS22 DICTION OF THE PHA.—Section 18(b)(3) of such Act is

23 amended by inserting the following new subparagraph

24 after subparagraph (C), and redesignating the following

25 subparagraphs accordingly:
36

•S 1299 RS

1 ‘‘(D) may provide that all or part of such addi2 tional dwelling units may be located outside the ju3 risdiction of the public housing agency (the ‘original

4 agency’) if—

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

6 market area as the original agency, as deter7 mined by the Secretary;

8 ‘‘(ii) the plan contains an agreement be9 tween the original agency and the public hous10 ing agency in the alternate location or other

11 public or private entity that will be responsible

12 for providing the additional units in the alter13 nate location (‘alternate agency or entity’) that

14 the alternate agency or entity will, with respect

15 to the dwelling units involved—

16 ‘‘(I) provide the dwelling units in ac17 cordance with subparagraph (A) of this

18 paragraph;

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

20 accordance with subparagraph (F) of this

21 paragraph;

22 ‘‘(III) meet the requirements of sub23 paragraph (G) of this paragraph and the

24 maximum rent provisions of subparagraph

25 (H) of this paragraph; and
37

•S 1299 RS

1 ‘‘(IV) not impose a local residency

2 preference on any resident of the jurisdic3 tion of the original agency for purposes of

4 admission to any such units; and

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

6 unit of general local government for the juris7 diction in which the additional units will be lo8 cated.’’.

9 DISALLOWANCE OF EARNED INCOME FOR RESIDENTS

10 WHO OBTAIN EMPLOYMENT

11 SEC. 203. (a) DISALLOWANCE OF EARNED INCOME

12 FROM PUBLIC HOUSING RENT DETERMINATIONS.—

13 (1) IN GENERAL.—Section 3 of the United

14 States Housing Act of 1937 is amended by striking

15 the undesignated paragraph at the end thereof and

16 inserting in lieu thereof the following new sub17 section:

18 ‘‘(d) DISALLOWANCE OF EARNED INCOME FROM

19 PUBLIC HOUSING RENT DETERMINATIONS.—Notwith20 standing any other provision of law, the rent payable

21 under subsection (a) for any public housing unit by a fam22 ily whose income increases as a result of employment of

23 a member of the family who was previously unemployed

24 for one or more years not be increased as a result of the

25 increased income due to such employment for a period of
38

•S 1299 RS

1 18 months, beginning with the commencement of employ2 ment.’’.

3 (2) APPLICABILITY OF AMENDMENT.—Notwith4 standing the amendment made by paragraph (1),

5 any resident of public housing participating in the

6 authority contained in such undesignated paragraph

7 immediately before its amendment by this section

8 shall continue to be governed by such authority.

9 (b) REPEALER.—Section 957 of the Cranston-Gon10 zalez National Affordable Housing Act is hereby repealed.

11 CEILING RENTS BASED ON REASONABLE RENTAL VALUE

12 SEC. 204. (a) Section 3(a)(2)(A)(iii) of the United

13 States Housing Act of 1937 is amended to read as follows:

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

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

16 (b) The Secretary shall, by notice published in the

17 Federal Register, establish such requirements as may be

18 necessary to carry out the provisions of section 3(a)(2)(A)

19 of the United States Housing Act of 1937, as amended

20 by subsection (a). The notice shall also invite public com21 ments, and the Secretary shall issue final regulations

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

23 comments received.
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•S 1299 RS

1 Subtitle B—Office of Community Planning and

2 Development Economic Revitalization Initiative

3 SEC. 210. (a) ECONOMIC REVITALIZATION

4 GRANTS.—(1) Section 108(a) of the Housing and Com5 munity Development Act of 1974 is amended by striking

6 the second sentence and inserting in lieu thereof the fol7 lowing: ‘‘A guarantee under this section (including a guar8 antee combined with a grant under subsection (q)) may

9 be used to assist a grantee in obtaining financing, only

10 if the grantee has made efforts to obtain the financing

11 without the use of the guarantee (and, if applicable, the

12 grant) and cannot complete the financing consistent with

13 the timely execution of the proposed activities and projects

14 without the guarantee (or, if applicable, the grant).’’.

15 (2) Section 108 of such Act is further amended by

16 adding at the end thereof the following new subsection:

17 ‘‘(q)(1) The Secretary is authorized to use amounts

18 deobligated under section 119 to provide grants in accord19 ance with this subsection for economic revitalization

20 projects to eligible public entities (units of general local

21 government) in connection with notes or other obligations

22 guaranteed for such entities under this section.

23 ‘‘(2) By regulation, the Secretary shall prescribe the

24 terms and conditions of these grants (in accordance with

25 this title, except as otherwise permitted by this sub-
40

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1 section), including guidelines related to economic revital2 ization projects eligible for grants, the amount of grant

3 funds to be provided for specific economic revitalization

4 projects applied for, and requirements applicable to the

5 use of the grant and the guaranteed loan proceeds by the

6 recipient. The regulations shall at a minimum implement

7 the provisions specified in this subsection.

8 ‘‘(3) The proceeds of the guaranteed loan, and the

9 grant under this subsection, shall be used to finance eco10 nomic development activities and projects eligible under

11 subsection (a) and specified in the approved application.

12 In this subsection, the term ‘‘economic revitalization

13 projects’’ refers to such eligible economic development

14 projects and activities.

15 ‘‘(4) If the eligible public entity proposes a grant

16 under this subsection, it shall submit its request to HUD,

17 in the form prescribed by HUD, with or as part of its

18 application for loan guarantee assistance under this sec19 tion.

20 ‘‘(5) To the extent funds are available, grants under

21 this subsection shall be approved on a first-come, first22 served basis.’’.

23 (3) Section 119(o) of such Act is amended by striking

24 ‘‘shall be’’ and all that follows up to the period and insert25 ing in lieu thereof the following: ‘‘shall, as determined by
41

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1 the Secretary, be added to amounts appropriated under

2 section 103 or be used to provide grants under section

3 108(q)’’.

4 (4) Title I of such Act is amended—

5 (A) in the second sentence of section 101(c), by

6 striking ‘‘and, if applicable, the funds received as a

7 result of a guarantee under section 108,’’ and by in8 serting in lieu therof ‘‘(including any such funds

9 used to make payments on a loan guaranteed by the

10 Secretary under section 108) and, if applicable, any

11 grant received under section 108(q),’’ and

12 (B) in section 104(b)(3), by striking ‘‘and, if

13 applicable, as a result of a guarantee under section

14 108,’’ and by inserting in lieu thereof ‘‘(including

15 any such funds used to make payments on a loan

16 guaranteed by the Secretary under section 108) and,

17 if applicable, any grant received under section

18 108(q),’’.

19 (b) SECTION 108 LOAN GUARANTEES FOR

20 COLONIAS.—The first sentence of section 108(a) of the

21 Housing and Community Development Act of 1974 is

22 amended—

23 (1) by striking ‘‘or’’ immediately after ‘‘section

24 105(a);’’; and
42

•S 1299 RS

1 (2) by inserting immediately before the period

2 at the end thereof the following: ’’; or (5) activities

3 under section 105(a)(2) with respect to colonias

4 under section 916 of the Cranston-Gonzalez Na5 tional Affordable Housing Act’’.

6 (c) GUARANTEE OF OBLIGATIONS BACKED BY SEC7 TION 108 LOANS.—Section 108 of the Housing and Com8 munity Development Act of 1974 is amended by adding

9 at the end thereof the following new subsection:

10 ‘‘(r)(1) The Secretary is authorized, upon such terms

11 and conditions as the Secretary deems appropriate, to

12 guarantee the timely payment of the principal of and in13 terest on such trust certificates or other obligations as

14 shall—

15 ‘‘(A) be offered by the Secretary or by any

16 other offeror approved for purposes of this sub17 section by the Secretary, and

18 ‘‘(B) be based on and backed by a trust or pool

19 composed of notes or other obligations guaranteed or

20 eligible for guarantee by the Secretary under this

21 section.

22 ‘‘(2) To the same extent as provided in subsection

23 (f), the full faith and credit of the United States is pledged

24 to the payment of all amounts which may be required to
43

•S 1299 RS

1 be paid under any guarantee by the Secretary under this

2 subsection.

3 ‘‘(3) In the event the Secretary pays a claim under

4 a guarantee issued under this section, it shall be sub5 rogated fully to the rights satisfied by such payment.

6 ‘‘(4) No State or local law, and no Federal law, shall

7 preclude or limit the exercise by the Secretary of—

8 ‘‘(A) the power to contract with respect to pub9 lic offerings and other sales of notes, trust certifi10 cates, and other obligations guaranteed under this

11 section upon such terms and conditions as the Sec12 retary deems appropriate,

13 ‘‘(B) the right to enforce by any means deemed

14 appropriate by the Secretary any such contract, and

15 ‘‘(C) the Secretary’s ownership rights, as appli16 cable, in notes, certificates, or other obligations

17 guaranteed under this section, or constituting the

18 trust or pool against which trust certificates, or

19 other obligations guaranteed under this section are

20 offered.’’.

21 HOME INVESTMENT PARTNERSHIPS

22 SEC. 211. (a) PARTICIPATION BY STATE AGENCIES

23 OR INSTRUMENTALITIES.—Section 104(2) of the Cran24 ston-Gonzalez National Affordable Housing Act is amend25 ed—

26 (1) by striking ‘‘and’’; and
44

•S 1299 RS

1 (2) by inserting before the period at the end

2 thereof the following: ‘‘, and any agency or instru3 mentality thereof that is established pursuant to leg4 islation and designated by the chief executive to act

5 on behalf of the jurisdiction with regard to provi6 sions of this Act’’.

7 (b) SIMPLIFY PROGRAM-WIDE INCOME TARGETING

8 FOR HOME RENTAL HOUSING.—Sections 214(1) (A) and

9 (B) of such Act are amended by striking ‘‘such funds are

10 invested with respect to dwelling units that are occupied

11 by’’ each place it appears and inserting in lieu thereof the

12 following: ‘‘(i) the families receiving such rental assistance

13 are, or (ii) the dwelling units assisted with such funds are

14 occupied by,’’.

15 (c) REMOVE FIRST-TIME HOMEBUYER LIMITATION

16 FOR HOME UNITS.—Section 215(b) of such Act is amend17 ed by striking paragraph (3) and redesignating para18 graphs (4) and (5) as paragraphs (3) and (4), respectively.

19 (d) SIMPLIFY RESALE PROVISIONS.—Section

20 215(b)(4)(B) of such Act is amended by striking ‘‘sub21 section’’ and inserting in lieu thereof ‘‘title’’.

22 (e) STABILIZATION OF HOME FUNDING THRESH23 OLDS.—

24 (1) Sections 216(10) and 217(b)(4) of such Act

25 are hereby repealed.
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1 (2) Section 217(b)(3) of such Act is amended—

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

3 those jurisdictions’’ and all that follows up to

4 the period and inserting in lieu thereof the fol5 lowing: ‘‘jurisdictions that are not participating

6 jurisdictions that are allocated an amount of

7 $500,000 or greater and jurisdictions that are

8 participating jurisdictions shall receive an allo9 cation’’; and

10 (B) in the last sentence, by striking ‘‘, ex11 cept as provided in paragraph (4)’’.

12 (3) Section 216 of such Act is amended—

13 (A) in paragraph (3), by striking ‘‘Except

14 as provided in paragraph (10), a jurisdiction’’

15 in the first sentence and inserting in lieu there16 of ‘‘A jurisdiction’’; and

17 (B) in paragraph (9)(B), by striking ‘‘, ex18 cept as provided in paragraph (10)’’.

19 (f) COMPREHENSIVE AFFORDABLE HOUSING STRAT20 EGY.—

21 (1) HOME PROGRAM.—The first sentence of

22 section 218(d) of such Act is amended by inserting

23 immediately after ‘‘providing certification’’ the fol24 lowing: ‘‘that it is following a current housing af-
46

•S 1299 RS

1 fordability strategy which has been approved by the

2 Secretary in accordance with section 105, and’’.

3 (2) HOMELESS ASSISTANCE PROGRAMS.—

4 (A) IN GENERAL.—Section 401 of the

5 Stewart B. McKinney Homeless Assistance Act

6 is amended to read as follows:

7 HOUSING AFFORDABILITY STRATEGY.

8 ‘‘SEC. 401. (a) REQUIREMENT TO FOLLOW A

9 CHAS.—Assistance may be made available Under subtitle

10 B to metropolitan cities, urban counties, and States receiv11 ing a formula amount under section 413, only if the juris12 diction certifies that it is following a current housing af13 fordability strategy which has been approved by the Sec14 retary in accordance with section 105 of the Cranston15 Gonzalez National Affordable Housing Act.

16 ‘‘(b) REQUIREMENT FOR CONSISTENCY WITH

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

18 only if the application contains a certification that the pro19 posed project or activities are consistent with the housing

20 strategy of the State or unit of general local government

21 in which the project is located. The certification shall be

22 from the public official responsible for submitting the

23 strategy for the jurisdiction.’’.

24 (B) CONFORMING CHANGES.—Title IV of

25 such Act is amended by striking sections

26 426(a)(2)(F), 434(a)(10), and 454(b)(9).
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1 (g) SIMPLIFY HOME MATCHING REQUIREMENTS.—

2 Section 220 of the Cranston-Gonzalez National Affordable

3 Housing Act is amended to read as follows:

4 ‘‘(a) CONTRIBUTION.—Each participating jurisdic5 tion shall make contributions to housing that qualifies as

6 affordable housing under this title that total, throughout

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

8 from the jurisdictions’s HOME Investment Trust Fund

9 in that fiscal year. This contribution shall be in addition

10 to any amounts made available under section

11 216(3)(A)(ii).’’.

12 (h) DELETE SEPARATE AUDIT REQUIREMENT FOR

13 THE HOME PROGRAM.—Section 283 of such Act is

14 amended—

15 (1) by striking the section heading and insert16 ing in lieu thereof the following: ‘‘AUDITS BY THE

17 COMPTROLLER GENERAL.’’;

18 (2) by striking subsection (a);

19 (3) by striking ‘‘(b) AUDITS BY THE COMP20 TROLLER GENERAL.—’’ and redesignating para21 graphs (1) and (2) as subsections (a) and (b), re22 spectively; and

23 (4) in subsection (a), as redesignated by para24 graph (3), by striking the second sentence.
48

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1 (i) HOME ENVIRONMENTAL REVIEW AMEND2 MENTS.—Section 288 of such Act is amended—

3 (1)(A) in the first sentence of subsection (a), by

4 striking out ‘‘participating jurisdictions’’ and insert5 ing in lieu thereof the following: ‘‘jurisdictions, In6 dian tribes, or insular areas’’; and

7 (B) in the first sentence of subsection (b) and

8 in subsection (c)(4), by striking ‘‘participating juris9 diction’’ each place it appears and inserting in lieu

10 thereof the following: ‘‘jurisdiction, Indian tribe, or

11 insular area’’; and

12 (2) by inserting at the end of subsection (a) the

13 following new sentences: ‘‘The regulations shall,

14 among other matters, provide for the monitoring of

15 the performance of environmental reviews under this

16 section and, in the discretion of the Secretary, for

17 the provision of facilitation of training for such per18 formance and suspension or termination of the as19 sumption under this section. The Secretary’s duty

20 under the foregoing sentence shall not be construed

21 as being in derogation of any responsibility assumed

22 by a State or unit of general local government with

23 respect to any particular release of funds.’’;

24 (3) in subsection (d), by striking out ‘‘ASSIST25 ANCE TO A STATE.—In the case of assistance to
49

•S 1299 RS

1 States’’ and inserting in lieu thereof the following:

2 ‘‘ASSISTANCE TO UNITS OF GENERAL LOCAL GOV3 ERNMENT FROM A STATE.—In the case of assist4 ance to units of general local government from a

5 State’’.

6 (j) USE OF CDBG FUNDS FOR HOME ADMINISTRA7 TIVE EXPENSES.—Section 105(a)(13) of the Housing and

8 Community Development Act of 1974 is amended by in9 serting immediately after ‘‘charges related to’’ the follow10 ing:

11 ‘‘(A) administering the HOME program under

12 title II of the Cranston-Gonzalez National Afford13 able Housing Act and (B)’’.

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

15 of such Act is amended by—

16 (1) inserting immediately after ‘‘housing coun17 seling’’ the following: ‘‘in connection with tenant18 based rental assistance and affordable housing

19 projects assisted under title II of the Cranston-Gon20 zalez National Affordable Housing Act’’; and

21 (2) striking ‘‘authorized’’ and all that follows

22 through ‘‘law’’ and inserting in lieu thereof the fol23 lowing: ‘‘assisted under title II of the Cranston-Gon24 zalez National Affordable Housing Act’’.
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1 REDUCE HOPE 3 MATCH REQUIREMENT TO 25 PERCENT

2 SEC. 212. Section 443(c)(1) of the Cranston-Gon3 zalez National Affordable Housing Act is amended by

4 striking ‘‘33’’ and inserting ‘‘25’’.

5 Subtitle C—Community Partnerships Against Crime

6 Compac Program

7 SEC. 220. (a) CONFORMING PROVISIONS.—(1) Sec8 tion 5001 of the Anti-Drug Abuse Act of 1988 is amend9 ed—

10 (A) by striking

‘‘CHAPTER 2—PUBLIC AND ASSISTED HOUSING DRUG ELIMINATION’’

11 and inserting in lieu thereof the following:

‘‘CHAPTER 2—COMMUNITY PARTNERSHIPS AGAINST CRIME’’;

12 (B) by striking ‘‘Congressional findings.’’ and

13 inserting in lieu thereof the following: ‘‘Purposes.’’;

14 and

15 (C) by adding after

‘‘Sec. 5130. Authorization of appropriations.’’

16 the following:

‘‘Sec. 5131. Technical assistance.’’.

17 (2) The heading for chapter 2 of subtitle C of

18 title V of the Anti-Drug Abuse Act of 1988 is

19 amended to read as follows:
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1 ‘‘CHAPTER 2—COMMUNITY PARTNERSHIPS

2 AGAINST CRIME’’.

3 (b) SHORT TITLE, PURPOSES, AND AUTHORITY TO

4 MAKE GRANTS.—Sections 5121, 5122, and 5123 of the

5 Public and Assisted Housing Drug Elimination Act of

6 1990 are amended to read as follows:

7 ‘‘SEC. 5121. SHORT TITLE.

8 ‘‘This chapter may be cited as the ‘Community Part9 nerships Against Crime Act of 1993’.

10 ‘‘SEC. 5122. PURPOSES.

11 ‘‘The purposes of this chapter are to—

12 ‘‘(1) substantially expand and enhance the Fed13 eral Government’s commitment to eliminating crime

14 in public housing;

15 ‘‘(2) broaden the scope of the Public and As16 sisted Housing Drug Elimination Act of 1990 to

17 apply to all types of crime, and not simply crime

18 that is drug-related;

19 ‘‘(3) target opportunities for long-term commit20 ments of funding primarily to public housing agen21 cies with serious crime problems;

22 ‘‘(4) encourage the involvement of a broad

23 range of community-based groups, and residents of

24 neighboring housing that is owned or assisted by the

25 Secretary, in the development and implementation of

26 anti-crime plans;
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1 ‘‘(5) reduce crime and disorder in and around

2 public housing through the expansion of community3 oriented policing activities and problem solving;

4 ‘‘(6) provide training, information services, and

5 other technical assistance to program participants;

6 and

7 ‘‘(7) 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) using amounts appropriated

18 for fiscal year 1994 only, to private, for-profit and non19 profit owners of federally assisted low-income housing. In

20 designing the program, the Secretary shall consult with

21 the Attorney General.’’.

22 (c) ELIGIBLE ACTIVITIES.—Section 5124 of such Act

23 is amended—

24 (1) by striking ‘‘(a) PUBLIC AND ASSISTED

25 HOUSING.—’’;
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1 (2) by inserting in the introductory material,

2 immediately after ‘‘used in’’, the following: ‘‘and

3 around’’;

4 (3) in paragraph (3), by inserting immediately

5 before the semicolon the following: ‘‘, such as fenc6 ing, lighting, locking, and surveillance systems’’;

7 (4) by striking paragraph (4)(A) and inserting

8 in lieu thereof the following new subparagraph:

9 ‘‘(A) to investigate crime; and’’;

10 (5) 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 (6) 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 in lieu thereof ‘‘crime’’; and

20 (C) by striking the period at the end and

21 inserting in lieu thereof a colon;

22 (7) by adding the following new paragraphs

23 after paragraph (7):

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- and problem-oriented

4 policing involving interaction with members of the

5 community on proactive crime control and preven6 tion;’’

7 ‘‘(9) youth initiatives, such as activities involv8 ing training, education, after school programs, cul9 tural programs, recreation and sports, career plan10 ning, and entrepreneurship and employment; and

11 ‘‘(10) resident service programs, such as job

12 training, education programs, and other appropriate

13 social services which address the contributing factors

14 of crime.’’; and

15 (8) by striking subsection (b).

16 (d) APPLICATIONS.—Section 5125 of such Act is

17 amended—

18 (1) in subsection (a)—

19 (A) by adding the paragraph designation

20 ‘‘(1)’’ immediately after ‘‘IN GENERAL.—’’;

21 (B) in the first sentence, by striking ‘‘, a

22 public housing resident management corpora23 tion,’’;

24 (C) in the second sentence, by striking

25 ‘‘drug-related crime on the premises of’’ and in-
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1 serting in lieu thereof the following: ‘‘crime in

2 and around’’; and

3 (D) by adding the following new para4 graphs at the end:

5 ‘‘(2) The Secretary shall, by regulation issued

6 after notice and opportunity for public comment, set

7 forth criteria for establishing a class of public hous8 ing agencies that have especially severe crime prob9 lems. Any public housing agency within this class

10 may submit an application for a one-year grant

11 under this chapter that, subject to the availability of

12 appropriated amounts, shall be renewed for a period

13 not exceeding the four subsequent years: Provided,

14 That the Secretary finds, after an annual or more

15 frequent performance review, that the public housing

16 agency is performing under the terms of the grant

17 and applicable laws in a satisfactory manner and

18 meets such other requirements as the Secretary may

19 prescribe.

20 ‘‘(3) Any eligible applicant may submit an ap21 plication for a grant for a period of up to two years.

22 The Secretary may accord a preference to applica23 tions seeking a subsequent grant under this para24 graph if the grant is to be used to continue or ex25 pand activities assisted under a previous grant under
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1 this paragraph and the Secretary finds that the ap2 plicant’s program under the prior grant is being

3 managed soundly and demonstrates success. Any

4 preferences under the preceding sentence shall not

5 unreasonably prejudice the opportunities of other

6 public housing agencies to be awarded grants under

7 this paragraph.’’;

8 (2) in subsection (b)—

9 (A) in the introductory material, by strik10 ing ‘‘subsections (c) and (d)’’ and inserting in

11 lieu thereof ‘‘subsections (a) and (c)’’;

12 (B) in paragraph (1), by striking ‘‘drug-re13 lated crime problem in’’ and inserting in lieu

14 thereof the following: ‘‘crime problem in and

15 around’’;

16 (C) in paragraph (2), by inserting imme17 diately after ‘‘crime problem in’’ the following:

18 ‘‘and around’’; and

19 (D) in paragraph (4), by inserting after

20 ‘‘local government’’ the following: ‘‘, local com21 munity-based non-profit organizations, local

22 resident organizations that represent the resi23 dents of neighboring projects that are owned or

24 assisted by the Secretary,’’;
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1 (3) in subsection (c)(2) by striking ‘‘drug-relat2 ed’’ the two places it appears; and

3 (4) by striking subsection (d).

4 (e) DEFINITIONS.—Section 5126 of such Act is

5 amended by striking paragraphs (1) and (2), and renum6 bering paragraphs (3) and (4) as paragraphs (1) and (2),

7 respectively.

8 (f) IMPLEMENTATION.—Section 5127 of such Act is

9 amended by striking ‘‘Cranston-Gonzalez National Afford10 able Housing Act’’ and inserting in lieu thereof ‘‘Housing

11 and Community Development Act of 1993’’.

12 (g) REPORTS.—Section 5128 of such Act is amended

13 by striking ‘‘drug-related crime in’’ and inserting in lieu

14 thereof the following: ‘‘crime in and around’’.

15 (h) AUTHORIZATION OF APPROPRIATIONS.—Section

16 5130 of such Act is amended—

17 (1) in the first sentence of subsection (a), by

18 striking ‘‘$175,000,000 for fiscal year 1993’’ and all

19 that follows and inserting in lieu thereof:

20 $265,000,000 for fiscal year 1994 and

21 $325,000,000 for fiscal year 1995.’’;

22 (2) in subsection (b)—

23 (A) by striking ‘‘SET-ASIDES’’ and insert24 ing in lieu thereof ‘‘SET-ASIDE’’;

25 (B) by striking the first sentence;
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1 (C) by striking ‘‘drug elimination’’;

2 (D) by striking ‘‘fiscal years 1993 and

3 1994’’ and inserting in lieu thereof ‘‘fiscal year

4 1994’’; and

5 (E) by striking ‘‘and 5.0 percent’’ and all

6 that follows through the end of the sentence

7 and inserting in lieu thereof a period; and

8 (3) by striking subsection (c) and section

9 520(k) of the Cranston-Gonzalez National Afford10 able Housing Act.

11 (i) TECHNICAL ASSISTANCE.—Such Act is further

12 amended by adding at the end thereof the following new

13 section:

14 ‘‘SEC. 5131. TECHNICAL ASSISTANCE.

15 ‘‘Of the amounts appropriated annually for each of

16 fiscal years 1994 and 1995 to carry out this chapter, the

17 Secretary is authorized to use up to $10,000,000, directly

18 or indirectly, under grants, contracts, cooperative agree19 ments, or otherwise, to provide training, information serv20 ices, and other technical assistance to public housing agen21 cies and other entities with respect to their participation

22 in the program authorized by this chapter. Such technical

23 assistance may include the establishment and operation of

24 the clearinghouse on drug abuse in public housing and the

25 regional training program on drug abuse in public housing
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1 under sections 5143 and 5144 of this Act. The Secretary

2 is also authorized to use the foregoing amounts for obtain3 ing assistance in establishing and managing assessment

4 and evaluation criteria and specifications, and obtaining

5 the opinions of experts in relevant fields.’’.

6 TITLE III—TECHNICAL AND OTHER

7 AMENDMENTS

8 Subtitle A—Public and Assisted Housing

9 CORRECT THE DEFINITION OF FAMILY IN THE 1937 ACT

10 TO CLARIFY THAT FAMILIES ARE NOT REQUIRED TO

11 INCLUDE CHILDREN

12 SEC. 301. The first sentence of section 3(b)(3)(B) of

13 the United States Housing Act of 1937 is amended by—

14 (1) striking out ‘‘means’’ and inserting ‘‘in15 cludes’’; and

16 (2) inserting ‘‘and’’ immediately after ‘‘chil17 dren,’’.

18 ELIMINATE REQUIREMENT FOR IDENTIFICATION OF CIAP

19 REPLACEMENT NEEDS

20 SEC. 302. (a) Section 14(d) of the United States

21 Housing Act of 1937 is amended—

22 (1) by striking paragraph (2); and

23 (2) in paragraph (4)—

24 (A) by deleting ‘‘and replacements,’’; and

25 (B) by striking ‘‘, (2),’’.

26 (b) Section 14(f)(1) of such Act is amended—
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•S 1299 RS

1 (1) by striking subparagraph (B); and

2 (2) in subparagraph (D), by striking ‘‘, (2),’’.

3 APPLICABILITY OF PUBLIC HOUSING AMENDMENTS TO

4 INDIAN HOUSING

5 SEC. 303. (a) Section 201(b) of the United States

6 Housing Act of 1937 is amended to read as follows—

7 ‘‘(b) APPLICABILITY OF TITLE I.—Except as other8 wise provided by law, the provisions of title I shall apply

9 to low-income housing developed or operated pursuant to

10 a contract between the Secretary and an Indian housing

11 authority.’’.

12 (b) The amendment made by subsection (a) shall not

13 affect provisions of the United States Housing Act of

14 1937 that were made applicable to public housing devel15 oped or operated pursuant to a contract between the Sec16 retary of Housing and Urban Development and an Indian

17 housing authority in accordance with section 201(b)(2) of

18 such Act, as it existed before the effective date of this sec19 tion.

20 (c) The provisions of sections 103(a)(1), 112, 114,

21 116, 118, 903, and 927 of the Housing and Community

22 Development Act of 1992 shall also apply to public hous23 ing developed or operated pursuant to a contract between

24 the Secretary of Housing and Urban Development and an

25 Indian housing authority.
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1 INCREASE THE UNIT THRESHOLD ABOVE WHICH PHAS

2 ARE REQUIRED TO ADOPT PROJECT-BASED ACCOUNTING

3 SEC. 304. Section 6(c)(4)(E) of the United States

4 Housing Act of 1937 is amended by striking ‘‘250’’ and

5 inserting in lieu thereof ‘500’’.

6 Subtitle B—Multifamily Housing

7 CORRECT ERRORS IN MULTIFAMILY MORTGAGE LIMITS

8 SEC. 310. Sections 207(c)(3), 213(b)(2),

9 220(d)(3)(B)(iii), and 234(e)(3) of the National Housing

10 Act are each amended by striking ‘‘$59,160’’ and insert11 ing ‘‘$56,160’’.

12 FHA MULTIFAMILY RISK-SHARING; HFA PILOT PROGRAM

13 AMENDMENTS

14 SEC. 311. (a) Section 542(c) of the Housing and

15 Community Development Act of 1992 is amended—

16 (1) in paragraph (2)(C), by striking the last

17 sentence and inserting in lieu thereof the following

18 new sentence: ‘‘Such agreements shall specify that

19 the qualified housing finance agency and the Sec20 retary shall share any loss in accordance with the

21 risk-sharing agreement.’’;

22 (2) in paragraph (2)(E)—

23 (A) by inserting the clause designation

24 ‘‘(i)’’ before the first sentence;
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1 (B) in the first sentence, by inserting after

2 ‘‘subsection’’ the following:’’, except as provided

3 in this section,’’; and

4 (C) by adding the following new paragraph

5 (2)(E)(ii):

6 ‘‘(ii) The mortgage shall—

7 ‘‘(I) provide for complete amortization

8 by periodic payments within such terms as

9 the Secretary shall prescribe;

10 ‘‘(II) not exceed 40 years from the be11 ginning of amortization; and

12 ‘‘(III) not exceed a loan-to-value or

13 loan-to-replacement cost of 90 percent for

14 profit-motivated owners and 100 percent

15 for nonprofit owners.’’;

16 (3) by adding the following new subparagraphs

17 at the end of paragraph (2):

18 ‘‘(F) The Secretary, upon request of a

19 qualified housing finance agency, may insure

20 and make commitments to insure under this

21 section any mortgage, advance, or loan other22 wise eligible under this section, pursuant to a

23 risk-sharing agreement providing that the hous24 ing finance agency will carry out (under a dele25 gation or otherwise, and with or without com-
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1 pensation, but subject to audit, exception, or re2 view requirements) such credit approval, ap3 praisal, inspection, issuance of commitments,

4 cost certification, servicing, property disposi5 tion, or other functions as the Secretary, pursu6 ant to regulations, shall approve as consistent

7 with the purpose of this section. All appraisals

8 of property for mortgage insurance under this

9 section shall be completed by a Certified Gen10 eral Appraiser in accordance with the Uniform

11 Standards of Professional Appraisal Practice.

12 ‘‘(G) Qualified housing finance agencies

13 shall make available to the Secretary or the

14 Secretary’s designee, at the Secretary’s request,

15 such financial and other records as the Sec16 retary deems necessary for program review and

17 monitoring purposes.

18 ‘‘(H) Notwithstanding any other provision

19 of this section, no new, existing, or rehabilitated

20 multifamily housing with respect to which a

21 mortgage is insured under this section shall be

22 operated for transient or hotel purposes. For

23 purposes of this paragraph, the term ‘rental for

24 transient or hotel purposes’ shall have such

25 meaning as prescribed by the Secretary, but
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1 rental for any period less than 30 days shall in

2 any event constitute rental for such purposes.

3 ‘‘(I) No mortgage with respect to multi4 family housing may be insured under this sec5 tion unless—

6 ‘‘(i) the mortgagor certifies under

7 oath that while such insurance remains

8 outstanding, he or she will not rent, or

9 permit the rental of, such housing or any

10 part thereof for transient or hotel pur11 poses; and

12 ‘‘(ii) the housing finance agency has

13 entered into such contract with the mort14 gagor as the Secretary deems necessary to

15 enable the housing finance agency to pre16 vent or terminate any use of such property

17 or project for transient or hotel purposes

18 while the mortgage insurance remains out19 standing.’’; and

20 (4) by adding at the end thereof the following

21 new paragraphs:

22 ‘‘(9) ENVIRONMENTAL AND OTHER REVIEWS.—

23 ‘‘(A) NEPA.—

24 ‘‘(i) IN GENERAL.—(I) In order to as25 sure that the policies of the National Envi-
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1 ronmental Policy Act of 1969 and other

2 provisions of law which further the pur3 poses of such Act (as specified in regula4 tions issued by the Secretary) are most ef5 fectively implemented in connection with

6 commitments to insure mortgages under

7 subsection (c)(2), and to assure to the pub8 lic undiminished protection of the environ9 ment, the Secretary, in lieu of the environ10 mental protection procedures otherwise ap11 plicable, may under regulations provide for

12 commitments to insure mortgages under

13 subsection (c)(2) upon the request of quali14 fied housing finance agencies under this

15 subsection if the States or units of general

16 local governments, as designated by the

17 Secretary in accordance with regulations,

18 assume all of the responsibilities for envi19 ronmental review, decisionmaking, and ac20 tion pursuant to such Act, and such other

21 provisions of law as the regulations of the

22 Secretary specify, that would otherwise

23 apply to the Secretary with respect to the

24 commitment or endorsement of mortgage

25 insurance on particular properties.
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1 ‘‘(II) The Secretary shall issue regula2 tions to carry out this subparagraph only

3 after consultation with the Council on En4 vironmental Quality. Such regulations

5 shall, among other matters, provide for

6 monitoring of the performance of environ7 mental reviews under this subparagraph

8 and, in the discretion of the Secretary, for

9 the provision or facilitation of training for

10 such performance and suspension or termi11 nation of the assumption under clause (I).

12 The Secretary’s duty under the foregoing

13 sentence shall not be construed as being in

14 derogation of any responsibility assumed

15 by a State or unit of general local govern16 ment with respect to any particular prop17 erty under clause (I).

18 ‘‘(ii) PROCEDURE.—The Secretary

19 shall approve the commitment to insure

20 subject to the procedures authorized by

21 this paragraph only if, at least 15 days

22 prior to such approval and prior to any

23 commitment or endorsement of mortgage

24 insurance on the property the qualified

25 housing finance agency has submitted to
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1 the Secretary a request for such commit2 ment to insure accompanied by a certifi3 cation of the State or unit of general local

4 government which meets the requirements

5 of clause (iii). The Secretary’s approval of

6 any such certification shall be deemed to

7 satisfy the Secretary’s responsibilities

8 under the National Environmental Policy

9 Act of 1969 and such other provisions of

10 law as the regulations of the Secretary

11 specify insofar as those responsibilities re12 late to the commitment or endorsement of

13 mortgage insurance on the property which

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 each provision of law

11 specified in regulations issued by the

12 Secretary insofar as the provisions of

13 such Act or other such provision of

14 law apply pursuant to clause (i), and

15 is authorized and consents on behalf

16 of the State or unit of general local

17 government and himself or herself to

18 accept the jurisdiction of the Federal

19 courts for the purpose of enforcement

20 of the responsibilities as such an offi21 cial.

22 ‘‘(B) LEAD-BASED PAINT POISONING PRE23 VENTION.—In carrying out the requirements of

24 section 302 of the Lead-Based Paint Poisoning

25 Prevention Act (42 U.S.C. 4822), the Secretary
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1 may provide by regulation for the assumption of

2 all or part of the Secretary’s duties under such

3 Act by qualified housing finance agencies, for

4 purposes of this section.

5 ‘‘(C) CERTIFICATION OF SUBSIDY

6 LAYERING COMPLIANCE.—The requirements of

7 section 102(d) of the Department of Housing

8 and Urban Development Reform Act of 1989

9 shall be satisfied in connection with a commit10 ment to insure a mortgage under this sub11 section by a certification by a qualified housing

12 finance agency to the Secretary that the com13 bination of Federal assistance provided in con14 nection with a property for which a mortgage is

15 to be insured shall not be any more than is nec16 essary to provide affordable housing.

17 ‘‘(10) As used in this section—

18 ‘‘(A) the term ‘mortgage’ means a first

19 mortgage on real estate that is—

20 ‘‘(i) owned in fee simple; or

21 ‘‘(ii) on a leasehold—

22 ‘‘(I) under a lease for not less

23 than 99 years which is renewable; or

24 ‘‘(II) under a lease having a pe25 riod of not less than ten years to run
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1 beyond the maturity of the mortgage;

2 and

3 ‘‘(B) the term ‘first mortgage’ means a

4 single first lien given to secure advances on, or

5 the unpaid purchase price of, real estate, under

6 the laws of the State in which the real estate

7 is located, together with the credit instrument,

8 if any, secured thereby. Any other financing

9 permitted on property insured under this sec10 tion must be expressly subordinate to the in11 sured mortgage; and

12 ‘‘(C) the terms ‘unit of general local gov13 ernment’ and ‘State’ mean the same as defined

14 in section 102(a)(1) and (2), respectively, of the

15 Housing and Community Development Act of

16 1974.’’.

17 (b) Section 544(1) is amended to read as follows:

18 ‘‘(1) The term ‘multifamily housing’ means

19 housing accommodations on the mortgaged property

20 that are designed principally for residential use, con21 form to standards satisfactory to the Secretary, and

22 consist of not less than five rental units on one site.

23 These units may be detached, semi-detached, row

24 houses, or multifamily structures.’’.
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1 SUBSIDY LAYERING REVIEW

2 SEC. 312. Section 911 of the Housing and Commu3 nity Development Act of 1992 is amended by—

4 (1) striking subsection (a) and inserting in lieu

5 thereof the following:

6 ‘‘(a) CERTIFICATION OF SUBSIDY LAYERING COM7 PLIANCE.—The requirements of section 102(d) of the De8 partment of Housing and Urban Development Reform Act

9 of 1989 shall be satisfied in connection with projects re10 ceiving assistance within the jurisdiction of the Depart11 ment of Housing and Urban Development and under sec12 tion 42 of the Internal Revenue Code of 1986 by a certifi13 cation by a housing credit agency to the Secretary, submit14 ted in accordance with guidelines established by the Sec15 retary, that the combination of Federal assistance pro16 vided in connection with a property for which assistance

17 is to be provided within the jurisdiction of the Department

18 of Housing and Urban Development and under section 42

19 of the Internal Revenue Code of 1986 shall not be any

20 more than is necessary to provide affordable housing.’’;

21 and

22 (2) striking subsection (c) and inserting in lieu

23 thereof the following:

24 ‘‘(c) REVOCATION BY SECRETARY.—If the Secretary

25 determines that a housing credit agency has failed to com-
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1 ply with the guidelines established under subsection (a),

2 the Secretary may inform the housing credit agency that

3 it may no longer submit certification of subsidy layering

4 compliance under this section. In such circumstances, the

5 responsibilities of section 102(d) of the Housing and

6 Urban Development Reform Act for affected projects allo7 cated a low income housing tax credit pursuant to section

8 42 of the Internal Revenue Code of 1986 shall be carried

9 out by the Secretary.’’.

10 SECTION 1. SHORT TITLE.

11 This Act may be cited as the ‘‘Housing and Commu12 nity Development Act of 1993’’.

13 SEC. 2. TABLE OF CONTENTS.

14 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.
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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.

Sec. 310. Indemnification of contractors for intellectual property rights disputes.

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—Rural Housing

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

1 SEC. 3. DEFINITIONS.

2 As used in this Act—

3 (1) the term ‘‘FHA’’ means the Federal Housing

4 Administration;

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

6 Housing and Urban Development; and

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

8 Corporation.
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1 TITLE I—FHA MULTIFAMILY

2 REFORMS

3 SEC. 101. MULTIFAMILY PROPERTY DISPOSITION.

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

5 (1) the portfolio of multifamily housing project

6 mortgages insured by the FHA is severely troubled

7 and at risk of default, requiring the Secretary to in8 crease loss reserves from $5.5 billion in 1991 to $11.9

9 billion in 1992 to cover estimated future losses;

10 (2) the inventory of multifamily housing projects

11 owned by the Secretary has more than tripled since

12 1989, and, by the end of 1993, may exceed 75,000

13 units;

14 (3) the cost to the Federal Government of owning

15 and maintaining multifamily housing projects esca16 lated to approximately $250 million in fiscal year

17 1992;

18 (4) the inventory of multifamily housing projects

19 subject to mortgages held by the Secretary has in20 creased dramatically, to more than 2,400 mortgages,

21 and approximately half of these mortgages, secured by

22 projects with over 230,000 units, are delinquent;

23 (5) the inventory of insured and formerly in24 sured multifamily housing projects is rapidly deterio25 rating, endangering tenants and neighborhoods;
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1 (6) over 5 million very low-income families

2 today have a critical need for housing that is afford3 able and habitable; and

4 (7) the current statutory framework governing

5 the disposition of multifamily housing projects effec6 tively impedes the Government’s ability to dispose of

7 properties, protect tenants, and ensure that projects

8 are maintained over time.

9 (b) MANAGEMENT AND DISPOSITION OF MULTIFAMILY

10 HOUSING PROJECTS.—Section 203 of the Housing and

11 Community Development Amendments of 1978 (12 U.S.C.

12 1701z–11) is amended to read as follows:

13 ‘‘SEC. 203. MANAGEMENT AND DISPOSITION OF MULTIFAM14 ILY HOUSING PROJECTS.

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

16 Development (hereafter in this section referred to as the

17 ‘Secretary’) shall manage or dispose of multifamily housing

18 projects that are owned by the Secretary or that are subject

19 to a mortgage held by the Secretary in a manner that—

20 ‘‘(1) is consistent with the National Housing Act

21 and this section;

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

23 Federal Government; and

24 ‘‘(3) will, in the least costly fashion among rea25 sonable available alternatives, further the goals of—
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1 ‘‘(A) preserving housing so that it can re2 main available to and affordable by low-income

3 persons;

4 ‘‘(B) preserving and revitalizing residential

5 neighborhoods;

6 ‘‘(C) maintaining existing housing stock in

7 a decent, safe, and sanitary condition;

8 ‘‘(D) minimizing the involuntary displace9 ment of tenants;

10 ‘‘(E) maintaining housing for the purpose

11 of providing rental housing, cooperative housing,

12 and homeownership opportunities for low-income

13 persons; and

14 ‘‘(F) minimizing the need to demolish mul15 tifamily housing projects.

16 The Secretary, in determining the manner in which a

17 project is to be managed or disposed of, shall balance com18 peting goals relating to individual projects in a manner

19 that will further the purposes of this section.

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

21 following definitions shall apply:

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

23 term ‘multifamily housing project’ means any multi24 family rental housing project that is, or prior to ac25 quisition by the Secretary was, assisted or insured
77

•S 1299 RS

1 under the National Housing Act, or was subject to a

2 loan under section 202 of the Housing Act of 1959.

3 ‘‘(2) SUBSIDIZED PROJECT.—The term ‘sub4 sidized project’ means a multifamily housing project

5 receiving any of the following types of assistance im6 mediately prior to the assignment of the mortgage on

7 such project to, or the acquisition of such mortgage

8 by, the Secretary:

9 ‘‘(A) Below market interest rate mortgage

10 insurance under the proviso of section 221(d)(5)

11 of the National Housing Act.

12 ‘‘(B) Interest reduction payments made in

13 connection with mortgages insured under section

14 236 of the National Housing Act.

15 ‘‘(C) Direct loans made under section 202 of

16 the Housing Act of 1959.

17 ‘‘(D) Assistance in the form of—

18 ‘‘(i) rent supplement payments under

19 section 101 of the Housing and Urban De20 velopment Act of 1965;

21 ‘‘(ii) additional assistance payments

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

23 Housing Act;

24 ‘‘(iii) housing assistance payments

25 made under section 23 of the United States
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•S 1299 RS

1 Housing Act of 1937 (as in effect before

2 January 1, 1975); or

3 ‘‘(iv) housing assistance payments

4 made under section 8 of the United States

5 Housing Act of 1937 (excluding payments

6 made for tenant-based assistance under sec7 tion 8);

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

9 Housing and Community Development Act of

10 1987) such assistance payments are made to

11 more than 50 percent of the units in the project.

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

13 term ‘formerly subsidized project’ means a multifam14 ily housing project owned by the Secretary that was

15 a subsidized project immediately prior to its acquisi16 tion by the Secretary.

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

18 ‘unsubsidized project’ means a multifamily housing

19 project owned by the Secretary that is not a sub20 sidized project or a formerly subsidized project.

21 ‘‘(c) MANAGEMENT OR DISPOSITION OF PROPERTY.—

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 the

25 Secretary on a negotiated, competitive bid, or other
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•S 1299 RS

1 basis, on such terms as the Secretary deems appro2 priate considering the low-income character of the

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

4 purchaser determined by the Secretary to be capable

5 of—

6 ‘‘(A) satisfying the conditions of the disposi7 tion plan;

8 ‘‘(B) implementing a sound financial and

9 physical management program that is designed

10 to enable the project to meet anticipated operat11 ing 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 tenants

15 and working cooperatively with tenant organiza16 tions;

17 ‘‘(D) providing adequate organizational,

18 staff, and financial resources to the project; and

19 ‘‘(E) meeting such other requirements as the

20 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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•S 1299 RS

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 determined

4 by the Secretary to be reasonable, with a man5 ager the Secretary has determined is capable

6 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 remain

12 in decent, safe, and sanitary condition;

13 ‘‘(ii) responding to the needs of the ten14 ants and working cooperatively with tenant

15 organizations;

16 ‘‘(iii) providing adequate organiza17 tional, staff, and other resources to imple18 ment a management program; and

19 ‘‘(iv) meeting such other requirements

20 as the Secretary may determine; and

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

22 housing project that is subject to a mortgage held

23 by the Secretary to contract for management

24 services for the project in the manner described

25 in subparagraph (A).
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1 ‘‘(d) MAINTENANCE OF HOUSING PROJECTS.—

2 ‘‘(1) HOUSING PROJECTS OWNED BY THE SEC3 RETARY.—In the case of multifamily housing projects

4 that are owned by the Secretary (or for which the Sec5 retary is mortgagee in possession), the Secretary

6 shall—

7 ‘‘(A) to the greatest extent possible, main8 tain all such occupied projects in a decent, safe,

9 and sanitary condition;

10 ‘‘(B) to the greatest extent possible, main11 tain full occupancy in all such projects; and

12 ‘‘(C) maintain all such projects for purposes

13 of providing rental or cooperative housing.

14 ‘‘(2) HOUSING PROJECTS SUBJECT TO A MORT15 GAGE HELD BY THE SECRETARY.—In the case of any

16 multifamily housing project that is subject to a mort17 gage held by the Secretary, the Secretary shall require

18 the owner of the project to carry out the requirements

19 of paragraph (1).

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

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

22 not less than one of the following actions:

23 ‘‘(1) CONTRACT WITH OWNER.—Enter into con24 tracts under section 8 of the United States Housing

25 Act of 1937, to the extent budget authority is avail-
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•S 1299 RS

1 able, with owners of multifamily housing projects that

2 are acquired by a purchaser other than the Secretary

3 at foreclosure or after sale by the Secretary.

4 ‘‘(A) SUBSIDIZED OR FORMERLY SUB5 SIDIZED PROJECTS RECEIVING CERTAIN ASSIST6 ANCE.—In the case of a subsidized project re7 ferred to in subparagraph (A), (B), or (C) of

8 subsection (b)(2) or a formerly subsidized project

9 that was subsidized as described in any such

10 subparagraph—

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

12 assist at least all units covered by an assist13 ance contract under any of the authorities

14 referred to in subsection (b)(2)(D) before ac15 quisition, unless the Secretary acts pursu16 ant to the provisions of subparagraph (C) of

17 this paragraph;

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

19 project-based rental assistance pursuant to

20 clause (i) that are occupied by families who

21 are not eligible for assistance under section

22 8, a contract under this subparagraph shall

23 also provide that when a vacancy occurs,

24 the owner shall lease the available unit to a
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•S 1299 RS

1 family eligible for assistance under section

2 8; and

3 ‘‘(iii) the Secretary shall take actions

4 to ensure the availability and affordability,

5 as defined in paragraph (3)(B), for the re6 maining useful life of the project, as defined

7 by the Secretary, of any unit located in any

8 project referred to in subparagraph (A),

9 (B), or (C) of subsection (b)(2) that does not

10 otherwise receive project-based rental assist11 ance under this subparagraph. To carry out

12 this clause, the Secretary may require pur13 chasers to establish use or rent restrictions

14 on these units.

15 ‘‘(B) SUBSIDIZED OR FORMERLY SUB16 SIDIZED PROJECTS RECEIVING OTHER ASSIST17 ANCE.—In the case of a subsidized project re18 ferred to in subsection (b)(2)(D) or a formerly

19 subsidized project that was subsidized as de20 scribed in subsection (b)(2)(D)—

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

22 assist at least all units in the project that

23 are covered, or that were covered imme24 diately before foreclosure on or acquisition

25 of the project by the Secretary, by an assist-
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•S 1299 RS

1 ance contract under any of the authorities

2 referred to in such subsection, unless the

3 Secretary acts pursuant to provisions of

4 subparagraph (C); and

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

6 project-based rental assistance pursuant to

7 clause (i) that are occupied by families who

8 are not eligible for assistance under section

9 8, a contract under this paragraph shall

10 also provide that when a vacancy occurs,

11 the owner shall lease the available unit to a

12 family eligible for assistance under section

13 8.

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

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

16 rental assistance under subparagraph (A) or (B),

17 the Secretary may require certain units in

18 unsubsidized projects to contain use restrictions

19 providing that such units will be available to

20 and affordable by very low-income families for

21 the remaining useful life of the project, as de22 fined by the Secretary, if—

23 ‘‘(i) the Secretary matches any reduc24 tion in the number of units otherwise re25 quired to be assisted with project-based rent-
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•S 1299 RS

1 al assistance under subparagraph (A) or

2 (B) with at least an equivalent increase in

3 the number of units made affordable, as

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

5 to very low-income persons within

6 unsubsidized projects;

7 ‘‘(ii) the Secretary makes tenant-based

8 assistance under section 8 available to low9 income tenants residing in units otherwise

10 requiring project-based rental assistance

11 under subparagraph (A) or (B) upon dis12 position; and

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

14 are located within the same market area.

15 ‘‘(D) CONTRACT REQUIREMENTS FOR

16 UNSUBSIDIZED PROJECTS.—Notwithstanding ac17 tions that are taken pursuant to subparagraph

18 (C), in any unsubsidized project—

19 ‘‘(i) the contract shall be at least suffi20 cient to provide project-based rental assist21 ance for all units that are covered or were

22 covered immediately before foreclosure or ac23 quisition by an assistance contract under—

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

25 States Housing Act of 1937, as such
86

•S 1299 RS

1 section existed before October 1, 1983

2 (new construction and substantial re3 habilitation); section 8(b) of such Act

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

5 of such Act (project-based certificates);

6 section 8(e)(2) of such Act (moderate

7 rehabilitation); section 23 of such Act

8 (as in effect before January 1, 1975);

9 or section 101 of the Housing and

10 Urban Development Act of 1965 (rent

11 supplements); or

12 ‘‘(II) section 8 of the United

13 States Housing Act of 1937, following

14 conversion from section 101 of the

15 Housing and Urban Development Act

16 of 1965; and

17 ‘‘(ii) the Secretary shall make available

18 tenant-based assistance under section 8 of

19 the United States Housing Act of 1937 to

20 tenants currently residing in units that

21 were covered by an assistance contract

22 under the Loan Management Set-Aside pro23 gram under section 8(b) of the United

24 States Housing Act of 1937 immediately be-
87

•S 1299 RS

1 fore foreclosure or acquisition of the project

2 by the Secretary.

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

4 the case of unsubsidized multifamily housing projects

5 that are acquired by a purchaser other than the Sec6 retary at foreclosure or after sale by the Secretary,

7 enter into annual contribution contracts with public

8 housing agencies to provide tenant-based assistance

9 under section 8 of the United States Housing Act of

10 1937 to all low-income families who are eligible for

11 such assistance on the date that the project is ac12 quired by the purchaser. The Secretary shall take ac13 tion under this paragraph only after making a deter14 mination that there is an adequate supply of habit15 able housing in the area that is available to and af16 fordable by low-income families using such assistance.

17 Actions may also be taken pursuant to this para18 graph in connection with not more than 10 percent

19 of the aggregate number of units in subsidized or for20 merly subsidized projects disposed of by the Secretary

21 in each fiscal year.

22 ‘‘(3) OTHER ASSISTANCE.—

23 ‘‘(A) IN GENERAL.—In accordance with the

24 authority provided under the National Housing

25 Act, reduce the selling price, apply use or rent
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•S 1299 RS

1 restrictions on certain units, or provide other fi2 nancial assistance to the owners of multifamily

3 housing projects that are acquired by a pur4 chaser other than the Secretary at foreclosure, or

5 after sale by the Secretary, on terms that will en6 sure that at least those units otherwise required

7 to receive project-based section 8 assistance pur8 suant to subparagraph (A), (B), or (D) of para9 graph (1) are available to and affordable by low10 income persons for the remaining useful life of

11 the project, as defined by the Secretary.

12 ‘‘(B) DEFINITION.—A unit shall be consid13 ered affordable under this paragraph if—

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

15 rent for such unit does not exceed 30 per16 cent of 50 percent of the area median in17 come, as determined by the Secretary, with

18 adjustments for family size; and

19 ‘‘(ii) for low-income tenants other than

20 very low-income tenants, the rent for such

21 unit does not exceed 30 percent of 80 per22 cent of the area median income, as deter23 mined by the Secretary, with adjustments

24 for family size.
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•S 1299 RS

1 ‘‘(C) VERY LOW-INCOME TENANTS.—The

2 Secretary shall provide assistance under section

3 8 of the United States Housing Act of 1937 to

4 any very low-income tenant currently residing

5 in a unit otherwise required to receive project6 based rental assistance under section 8, pursuant

7 to subparagraph (A), (B), or (D) of paragraph

8 (1), if the rents charged such tenants as a result

9 of actions taken pursuant to this paragraph ex10 ceed the amount payable as rent under section

11 3(a) of the United States Housing Act of 1937.

12 ‘‘(4) TRANSFER FOR USE UNDER OTHER PRO13 GRAMS OF THE SECRETARY.—

14 ‘‘(A) IN GENERAL.—Enter into an agree15 ment providing for the transfer of a multifamily

16 housing project—

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

18 of the project as public housing; or

19 ‘‘(ii) to an owner or another appro20 priate entity for use of the project under

21 section 202 of the Housing Act of 1959 or

22 under section 811 of the Cranston-Gonzalez

23 National Affordable Housing Act.
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•S 1299 RS

1 ‘‘(B) REQUIREMENTS FOR AGREEMENT.—

2 The agreement described in subparagraph (A)

3 shall—

4 ‘‘(i) contain such terms, conditions,

5 and limitations as the Secretary determines

6 appropriate, including requirements to as7 sure use of the project under the public

8 housing, section 202, and section 811 pro9 grams; and

10 ‘‘(ii) ensure that no current tenant will

11 be displaced as a result of actions taken

12 under this paragraph.

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

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

15 the following actions:

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

17 loans to facilitate the sale of multifamily housing

18 projects to nonprofit organizations or to public agen19 cies if—

20 ‘‘(A) authority for such loans is provided in

21 advance in an appropriations Act;

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

23 than 5 years;

24 ‘‘(C) the Secretary is presented with satis25 factory documentation, evidencing a commitment
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•S 1299 RS

1 of permanent financing to replace such short2 term loan, from a lender who meets standards set

3 forth by the Secretary; and

4 ‘‘(D) the terms of such loans are consistent

5 with prevailing practices in the marketplace or

6 the provision of such loans results in no cost to

7 the Government, as defined in section 502 of the

8 Congressional Budget Act.

9 ‘‘(2) TENANT-BASED ASSISTANCE.—Make avail10 able tenant-based assistance under section 8 of the

11 United States Housing Act of 1937 to very low-in12 come families that do not otherwise qualify for

13 project-based rental assistance.

14 ‘‘(3) ALTERNATIVE USES.—

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

16 other provision of law, and subject to notice to

17 and comment from existing tenants, allow not

18 more than—

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

20 units in multifamily housing projects that

21 are disposed of by the Secretary during each

22 fiscal year to be made available for uses

23 other than rental or cooperative housing, in24 cluding low-income homeownership oppor25 tunities, community space, office space for
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•S 1299 RS

1 tenant or housing-related service providers

2 or security programs, or small business

3 uses, if such uses benefit the tenants of the

4 project; and

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

6 units in multifamily housing projects that

7 are disposed of by the Secretary during each

8 fiscal year to be used in any manner, if the

9 Secretary and the unit of general local gov10 ernment or area-wide governing body deter11 mine that such use will further fair hous12 ing, community development, or neighbor13 hood revitalization goals.

14 ‘‘(B) DISPLACEMENT PROTECTION.—The

15 Secretary shall—

16 ‘‘(i) make available tenant-based as17 sistance under section 8 of the United

18 States Housing Act of 1937 to any tenant

19 displaced as a result of actions taken by the

20 Secretary pursuant to subparagraph (A);

21 and

22 ‘‘(ii) take such actions as the Secretary

23 determines necessary to ensure the successful

24 use of any tenant-based assistance provided

25 under this subparagraph.
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•S 1299 RS

1 ‘‘(4) AUTHORIZATION OF USE OR RENT RESTRIC2 TIONS IN UNSUBSIDIZED PROJECTS.—In carrying out

3 the goals specified in subsection (a), the Secretary

4 may require certain units in unsubsidized projects

5 upon disposition to contain use or rent restrictions

6 providing that such units will be available to and af7 fordable by very low-income persons for the remaining

8 useful life of the property, as defined by the Secretary.

9 ‘‘(g) CONTRACT REQUIREMENTS.—

10 ‘‘(1) CONTRACT TERM.—

11 ‘‘(A) IN GENERAL.—Contracts for project12 based rental assistance under section 8 of the

13 United States Housing Act of 1937 provided

14 pursuant to this section shall be for a term of not

15 more than 15 years; and

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

17 YEARS.—To the extent that units receive project18 based rental assistance for a contract term of less

19 than 15 years, the Secretary shall require that

20 rents charged to tenants for such units shall not

21 exceed the amount payable for rent under section

22 3(a) of the United States Housing Act of 1937

23 for a period of at least 15 years.

24 ‘‘(2) CONTRACT RENT.—
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•S 1299 RS

1 ‘‘(A) IN GENERAL.—The Secretary shall set

2 contract rents for section 8 project-based rental

3 contracts issued under this section at levels that,

4 in conjunction with other resources available to

5 the purchaser, provide for the necessary costs of

6 rehabilitation of such project and do not exceed

7 the percentage of the existing housing fair mar8 ket rents for the area, as determined by the Sec9 retary under section 8(c) of the United States

10 Housing Act of 1937.

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

13 Secretary may utilize the budget authority pro14 vided for project-based section 8 contracts issued

15 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 multi22 family housing project that is owned by the Secretary,

23 the Secretary shall develop a disposition plan for the

24 project that specifies the minimum terms and condi25 tions of the Secretary for disposition of the project,
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•S 1299 RS

1 the initial sales price that is acceptable to the Sec2 retary, and the assistance that the Secretary plans to

3 make available to a prospective purchaser in accord4 ance with this section. The initial sales price shall re5 flect the intended use of the property after sale.

6 ‘‘(2) COMMUNITY AND TENANT INPUT INTO DIS7 POSITION PLANS AND SALES.—

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

9 section, the Secretary shall develop procedures to

10 obtain appropriate and timely input into dis11 position plans from officials of the unit of gen12 eral local government affected, the community in

13 which the project is situated, and the tenants of

14 the project.

15 ‘‘(B) TENANT ORGANIZATIONS.—The Sec16 retary shall develop procedures to facilitate,

17 where feasible and appropriate, the sale of multi18 family housing projects to existing tenant orga19 nizations with demonstrated capacity or to pub20 lic or nonprofit entities that represent or are af21 filiated with existing tenant organizations.

22 ‘‘(C) TECHNICAL ASSISTANCE.—

23 ‘‘(i) IN GENERAL.—To carry out the

24 procedures developed under subparagraphs

25 (A) and (B), the Secretary is authorized to
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•S 1299 RS

1 provide technical assistance, directly or in2 directly.

3 ‘‘(ii) TECHNICAL ASSISTANCE PROVID4 ERS.—Recipients of technical assistance

5 funding under the Emergency Low Income

6 Housing Preservation Act of 1987, the Low7 Income Housing Preservation and Resident

8 Homeownership Act of 1990, subtitle B of

9 title IV of the Cranston-Gonzalez National

10 Affordable Housing Act, shall be permitted

11 to provide technical assistance to the extent

12 of such funding under any of such programs

13 or under this section, notwithstanding the

14 source of funding.

15 ‘‘(iii) AUTHORIZATION OF APPROPRIA16 TIONS.—There are authorized to be appro17 priated $5,000,000 to carry out this sub18 paragraph. In addition, the Secretary is

19 authorized to use amounts appropriated for

20 technical assistance under the Emergency

21 Low Income Housing Preservation Act of

22 1987, the Low-Income Housing Preservation

23 and Resident Homeownership Act of 1990,

24 subtitle B of title IV of the Cranston-Gon25 zalez National Affordable Housing Act, for
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•S 1299 RS

1 the provision of technical assistance under

2 this section.

3 ‘‘(i) RIGHT OF FIRST REFUSAL.—

4 ‘‘(1) PROCEDURE.—

5 ‘‘(A) NOTIFICATION BY SECRETARY OF THE

6 ACQUISITION OF TITLE.—Not later than 30 days

7 after the Secretary acquires title to a multifam8 ily housing project, the Secretary shall notify the

9 appropriate unit of general local government

10 and State agency or agencies designated by the

11 Governor of the acquisition of such title.

12 ‘‘(B) EXPRESSION OF INTEREST.—Not later

13 than 45 days after receiving notification from

14 the Secretary under subparagraph (A), the unit

15 of general local government or designated State

16 agency may submit to the Secretary a prelimi17 nary expression of interest in the project. The

18 Secretary may take such actions as may be nec19 essary to require the unit of general local govern20 ment or designated State agency to substantiate

21 such interest.

22 ‘‘(C) TIMELY EXPRESSION OF INTEREST.—

23 If the unit of general local government or des24 ignated State agency has expressed interest in

25 the project before the expiration of the 45-day pe-
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•S 1299 RS

1 riod referred to in subparagraph (B) and has

2 substantiated such interest if requested, the Sec3 retary shall notify the unit of general local gov4 ernment or designated State agency, within a

5 reasonable period of time, of the terms and con6 ditions of the disposition plan, in accordance

7 with subsection (h). The Secretary shall then give

8 the unit of general local government or des9 ignated State agency not more than 90 days

10 after the date of such notification to make an

11 offer to purchase the project.

12 ‘‘(D) NO TIMELY EXPRESSION OF INTER13 EST.—If the unit of general local government or

14 designated State agency does not express interest

15 before the expiration of the 45-day period re16 ferred to in subparagraph (B), or does not sub17 stantiate an expressed interest if requested, the

18 Secretary may offer the project for sale to any

19 interested person or entity.

20 ‘‘(2) ACCEPTANCE OF OFFERS.—If the Secretary

21 has given the unit of general local government or des22 ignated State agency 90 days to make an offer to pur23 chase the project, the Secretary shall accept an offer

24 that complies with the terms and conditions of the

25 disposition plan. The Secretary may accept an offer
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•S 1299 RS

1 that does not comply with the terms and conditions

2 of the disposition plan if the Secretary determines

3 that the offer will further the goals specified in sub4 section (a) by actions that include extension of the

5 duration of low-income affordability restrictions or

6 otherwise restructuring the transaction in a manner

7 that enhances the long-term affordability for low-in8 come persons. The Secretary shall, in particular, have

9 discretion to reduce the initial sales price in exchange

10 for the extension of low-income affordability restric11 tions beyond the period of assistance contemplated by

12 the attachment of assistance pursuant to subsection

13 (e) or for an increase in the number of units that are

14 available to and affordable by low-income families. If

15 the Secretary and the unit of general local govern16 ment or designated State agency cannot reach agree17 ment within 90 days, the Secretary may offer the

18 project for sale to the general public.

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

20 GOVERNMENT OR DESIGNATED STATE AGENCY.—Not21 withstanding any other provision of law, a unit of

22 general local government (including a public housing

23 agency) or designated State agency may purchase

24 multifamily housing projects in accordance with this

25 subsection.
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1 ‘‘(4) APPLICABILITY.—This subsection shall

2 apply to projects that are acquired on or after the ef3 fective date of this subsection. With respect to projects

4 acquired before such effective date, the Secretary may

5 apply—

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

7 and (3) of section 203(e) as such paragraphs ex8 isted immediately before the effective date of this

9 subsection; or

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

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

12 the unit of general local government or des13 ignated State agency—

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

15 project; and

16 ‘‘(ii) if the unit of general local govern17 ment or designated State agency expresses

18 interest in the project before the expiration

19 of the 45-day period, and substantiates such

20 interest if requested, 90 days from the date

21 of notification of the terms and conditions

22 of the disposition plan to make an offer to

23 purchase the project.

24 ‘‘(j) DISPLACEMENT OF TENANTS AND RELOCATION

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

2 displaced as a result of the disposition of, or repairs

3 to, a multifamily housing project that is owned by the

4 Secretary (or for which the Secretary is mortgagee in

5 possession), the Secretary shall identify tenants who

6 will be displaced, and shall notify all such tenants of

7 their pending displacement and of any relocation as8 sistance that may be available. In the case of a multi9 family housing project that is not owned by the Sec10 retary (and for which the Secretary is not mortgagee

11 in possession), the Secretary shall require the owner

12 of the project to carry out the requirements of this

13 paragraph.

14 ‘‘(2) RIGHTS OF DISPLACED TENANTS.—The Sec15 retary shall assure for any such tenant (who contin16 ues to meet applicable qualification standards) the

17 right—

18 ‘‘(A) to return, whenever possible, to a re19 paired unit;

20 ‘‘(B) to occupy a unit in another multifam21 ily housing project owned by the Secretary;

22 ‘‘(C) to obtain housing assistance under the

23 United States Housing Act of 1937; or
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1 ‘‘(D) to receive any other available reloca2 tion assistance as the Secretary determines to be

3 appropriate.

4 ‘‘(k) MORTGAGE AND PROJECT SALES.—

5 ‘‘(1) IN GENERAL.—The Secretary may not ap6 prove the sale of any loan or mortgage held by the

7 Secretary (including any loan or mortgage owned by

8 the Government National Mortgage Association) on

9 any subsidized project or formerly subsidized project,

10 unless such sale is made as part of a transaction that

11 will ensure that such project will continue to operate

12 at least until the maturity date of such loan or mort13 gage, in a manner that will provide rental housing on

14 terms at least as advantageous to existing and future

15 tenants as the terms required by the program under

16 which the loan or mortgage was made or insured

17 prior to the assignment of the loan or mortgage on

18 such project to the Secretary.

19 ‘‘(2) SALE OF CERTAIN PROJECTS.—The Sec20 retary may not approve the sale of any subsidized

21 project—

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

23 the Secretary; or
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1 ‘‘(B) if the sale transaction involves the pro2 vision of any additional subsidy funds by the

3 Secretary or a recasting of the mortgage;

4 unless such sale is made as part of a transaction that

5 will ensure that such project will continue to operate

6 at least until the maturity date of the loan or mort7 gage, in a manner that will provide rental housing on

8 terms at least as advantageous to existing and future

9 tenants as the terms required by the program under

10 which the loan or mortgage was made or insured

11 prior to the proposed sale of the project.

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

13 GOVERNMENTS.—Notwithstanding any provision of

14 law that may require competitive sales or bidding, the

15 Secretary may carry out negotiated sales of mortgages

16 held by the Secretary that are secured by subsidized

17 or formerly subsidized multifamily housing projects,

18 without the competitive selection of purchasers or

19 intermediaries, to units of general local government

20 or State agencies, or groups of investors that include

21 at least 1 such unit of general local government or

22 State agency, if the negotiations are conducted with

23 such agencies, except that—

24 ‘‘(A) the terms of any such sale shall in25 clude the agreement of the purchasing agency or
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1 unit of local government or State agency to act

2 as mortgagee or owner of a beneficial interest in

3 such mortgages, in a manner consistent with

4 maintaining the projects that are subject to such

5 mortgages for occupancy by the general tenant

6 group intended to be served by the applicable

7 mortgage insurance program, including, to the

8 extent the Secretary determines appropriate, au9 thorizing such unit of local government or State

10 agency to enforce the provisions of any regu11 latory agreement or other program requirements

12 applicable to the related projects; and

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

14 shall be, in the determination of the Secretary,

15 the best prices that may be obtained for such

16 mortgages from a unit of general local govern17 ment or State agency, consistent with the expec18 tation and intention that the projects financed

19 will be retained for use under the applicable

20 mortgage insurance program for the life of the

21 initial mortgage insurance contract.

22 ‘‘(4) SALE OF MORTGAGES COVERING

23 UNSUBSIDIZED PROJECTS.—Notwithstanding any

24 other provision of law, the Secretary may sell mort-
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1 gages held on unsubsidized projects on such terms and

2 conditions as the Secretary may prescribe.

3 ‘‘(l) PROJECT-BASED RENTAL ASSISTANCE FOR TERM

4 OF LESS THAN 15 YEARS.—Notwithstanding subsection

5 (g), project-based rental assistance in connection with the

6 disposition of a multifamily housing project may be pro7 vided for a contract term of less than 15 years if such assist8 ance is provided—

9 ‘‘(1) under a contract authorized under section 6

10 of the HUD Demonstration Act of 1993; and

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

12 section for a project that is determined by the Sec13 retary to be otherwise in compliance with this section.

14 ‘‘(m) REPORT TO CONGRESS.—Not later than June 1

15 of each year, the Secretary shall submit to the Committee

16 on Banking, Housing, and Urban Affairs of the Senate and

17 the Committee on Banking, Finance and Urban Affairs of

18 the House of Representatives, a report describing the status

19 of multifamily housing projects owned by or subject to mort20 gages held by the Secretary. The report shall include—

21 ‘‘(1) the name, address, and size of each project;

22 ‘‘(2) the nature and date of assignment;

23 ‘‘(3) the status of the mortgage;

24 ‘‘(4) the physical condition of the project;
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1 ‘‘(5) an occupancy profile of the project, includ2 ing the income, family size, and race of current resi3 dents as well as the rents paid by such residents;

4 ‘‘(6) the proportion of units in a project that are

5 vacant;

6 ‘‘(7) the date on which the Secretary became

7 mortgagee in possession;

8 ‘‘(8) the date and conditions of any foreclosure

9 sale;

10 ‘‘(9) the date of acquisition by the Secretary;

11 ‘‘(10) the date and conditions of any property

12 disposition sale;

13 ‘‘(11) a description of actions undertaken pursu14 ant to this section, including—

15 ‘‘(A) a comparison of results between ac16 tions taken after the date of enactment of the

17 Housing and Community Development Act of

18 1993 and actions taken in the years preceding

19 such date of enactment;

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

21 the disposition or management of multifamily

22 housing projects, together with a recommenda23 tion of proposed legislative or regulatory changes

24 designed to ameliorate such impediments;
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1 ‘‘(C) a description of actions taken to re2 structure or commence foreclosure on delinquent

3 multifamily mortgages held by the Department;

4 and

5 ‘‘(D) a description of actions taken to mon6 itor and prevent the default of multifamily hous7 ing mortgages held by the Federal Housing Ad8 ministration;

9 ‘‘(12) a description of any of the functions per10 formed in connection with this section that are con11 tracted out to public or private entities or to States,

12 including—

13 ‘‘(A) the costs associated with such delega14 tion;

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

16 delegating such functions for current Department

17 field or regional personnel, including anticipated

18 personnel or work load reductions;

19 ‘‘(C) necessary oversight required by De20 partment personnel, including anticipated per21 sonnel hours devoted to such oversight;

22 ‘‘(D) a description of any authority granted

23 to such public or private entities or States in

24 conjunction with the functions that have been

25 delegated or contracted out or that are not other-
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1 wise available for use by Department personnel;

2 and

3 ‘‘(E) the extent to which such public or pri4 vate entities or States include tenants of multi5 family housing projects in the disposition plan6 ning for such projects;

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

8 under subsection (j) during the preceding year; and

9 ‘‘(14) a description and assessment of the rules,

10 guidelines, and practices governing the Department’s

11 management of multifamily housing projects that are

12 owned by the Secretary (or for which the Secretary is

13 mortgagee in possession) as well as the steps that the

14 Secretary has taken or plans to take to improve the

15 management performance of the Department.’’.

16 (c) EFFECTIVE DATE.—The Secretary shall, by notice

17 published in the Federal Register, which shall take effect

18 upon publication, establish such requirements as may be

19 necessary to implement the amendments made by this sec20 tion. The notice shall invite public comments and, not later

21 than 12 months after the date on which the notice is pub22 lished, the Secretary shall issue final regulations based on

23 the initial notice, taking into account any public comments

24 received.
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1 SEC. 102. REPEAL OF STATE AGENCY MULTIFAMILY PROP2 ERTY DISPOSITION DEMONSTRATION.

3 Section 184 of the Housing and Community Develop4 ment Act of 1987 (12 U.S.C. 1701z–11 note) is hereby re5 pealed.

6 SEC. 103. RTC MARKETING AND DISPOSITION OF MULTI7 FAMILY PROJECTS OWNED BY HUD.

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

9 a demonstration with not more than 50 unsubsidized multi10 family housing projects owned by the Secretary, using the

11 RTC for the marketing and disposition of the projects. Any

12 such demonstration shall be carried out pursuant to an

13 agreement between the RTC and the Secretary on such

14 terms and conditions as are acceptable to the RTC and the

15 Secretary. The RTC shall establish policies and procedures

16 for marketing and disposition, subject to review and ap17 proval by the Secretary.

18 (b) RULES GOVERNING THE DEMONSTRATION.—

19 (1) IN GENERAL.—Except as provided in para20 graph (2), in carrying out the provisions of this sec21 tion, the RTC shall dispose of unsubsidized multifam22 ily housing projects pursuant to the provisions of sec23 tion 21A(c) of the Federal Home Loan Bank Act.

24 (2) EXCEPTION.—Notwithstanding paragraph

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

26 unit otherwise required under subsection (e)(1)(D) of
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1 section 203 of the Housing and Community Develop2 ment Amendments of 1978 to receive project-based

3 rental assistance under section 8, shall upon disposi4 tion pay not more than the amount payable as rent

5 under section 3(a) of the United States Housing Act

6 of 1937.

7 (c) DETERMINATION OF PROJECTS INCLUDED.—In de8 termining which projects to include in the demonstration,

9 the Secretary and the RTC shall take into consideration—

10 (1) the prior experience of the RTC in disposing

11 of other multifamily housing projects in the jurisdic12 tions in which such projects are located; and

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

14 RTC determine to be appropriate.

15 (d) REIMBURSEMENT.—The agreement entered into

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

17 shall reimburse the RTC for the direct costs associated with

18 the demonstration, including the costs of administration

19 and marketing, property management, and any repair and

20 rehabilitation. The Secretary may use proceeds from the

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

22 (e) REPORTS.—

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

24 RTC shall jointly submit an annual report to the

25 Committee on Banking, Housing, and Urban Affairs
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1 of the Senate and the Committee on Banking, Fi2 nance and Urban Affairs of the House of Representa3 tives detailing the progress of the demonstration.

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

5 after the completion of the demonstration, the Sec6 retary shall submit to the Committee on Banking,

7 Housing, and Urban Affairs of the Senate and the

8 Committee on Banking, Finance and Urban Affairs

9 of the House of Representatives a report describing

10 the results of the demonstration and any rec11 ommendations for legislative action.

12 (f) TERMINATION.—The demonstration under this sec13 tion shall not extend beyond the termination date of the

14 RTC.

15 SEC. 104. CIVIL MONEY PENALTIES AGAINST GENERAL

16 PARTNERS AND CERTAIN MANAGING AGENTS

17 OF MULTIFAMILY HOUSING PROJECTS.

18 (a) CIVIL MONEY PENALTIES AGAINST MULTIFAMILY

19 MORTGAGORS.—Section 537 of the National Housing Act

20 (12 U.S.C. 1735f–15) is amended—

21 (1) in subsection (b)(1), by inserting after ‘‘mort22 gagor’’ the second place it appears the following: ‘‘or

23 general partner of a partnership mortgagor’’;

24 (2) in subsection (c)—
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1 (A) by striking the heading and inserting

2 the following:

3 ‘‘(c) OTHER VIOLATIONS.—’’; and

4 (B) in paragraph (1)—

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

6 and all that follows through the colon and

7 inserting the following:

8 ‘‘(A) LIABLE PARTIES.—The Secretary may

9 also impose a civil money penalty under this sec10 tion on—

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

12 includes 5 or more living units and that

13 has a mortgage insured, coinsured, or held

14 pursuant to this Act;

15 ‘‘(ii) the general partner of a partner16 ship mortgagor of such property; or

17 ‘‘(iii) any agent employed to manage

18 the property that has an identity of interest

19 with the mortgagor or the general partner of

20 a partnership mortgagor of such property.

21 ‘‘(B) VIOLATIONS.—A penalty may be im22 posed under this paragraph for knowingly and

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

24 (ii) in subparagraph (B), as redesig25 nated, by redesignating subparagraphs (A)
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1 through (L) as clauses (i) through (xii), re2 spectively; and

3 (iii) by adding after clause (xii), as re4 designated, the following new clauses:

5 ‘‘(xiii) Failure to maintain the prem6 ises, accommodations, and the grounds and

7 equipment appurtenant thereto in good re8 pair and condition in accordance with reg9 ulations and requirements of the Secretary.

10 ‘‘(xiv) Failure, by a mortgagor or gen11 eral partner of a partnership mortgagor, to

12 provide management for the project that is

13 acceptable to the Secretary pursuant to reg14 ulations and requirements of the Sec15 retary.’’; and

16 (iv) in the last sentence, by deleting ‘‘of

17 such agreement’’ and inserting ‘‘of this sub18 section’’;

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

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

21 partnership mortgagor, or identity of interest agent

22 employed to manage the property,’’;

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

24 following new paragraph:
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1 ‘‘(5) PAYMENT OF PENALTY.—No payment of a

2 civil money penalty levied under this section shall be

3 payable out of project income.’’;

4 (5) in subsection (e)(1), by deleting ‘‘a mortga5 gor’’ and inserting ‘‘an entity or person’’;

6 (6) in subsection (f), by inserting after ‘‘mortga7 gor’’ each place such term appears the following: ‘‘,

8 general partner of a partnership mortgagor, or iden9 tity of interest agent employed to manage the prop10 erty,’’;

11 (7) by striking the heading of subsection (f) and

12 inserting the following: ‘‘CIVIL MONEY PENALTIES

13 AGAINST MULTIFAMILY MORTGAGORS, GENERAL

14 PARTNERS OF PARTNERSHIP MORTGAGORS, AND

15 CERTAIN MANAGING AGENTS’’; and

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

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

18 end and inserting the following: ‘‘the Secretary shall

19 apply all civil money penalties collected under this

20 section, or any portion of such penalties, to the fund

21 established under section 201(j) of the Housing and

22 Community Development Amendments of 1978.’’.

23 (b) APPLICABILITY OF AMENDMENTS.—The amend24 ments made by subsection (a) shall apply only with respect

25 to—
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1 (1) violations that occur on or after the effective

2 date of this Act; and

3 (2) in the case of a continuing violation (as de4 termined by the Secretary), any portion of a violation

5 that occurs on or after such date.

6 SEC. 105. MODELS FOR PROPERTY DISPOSITION.

7 The Federal Housing Commissioner shall develop mod8 els which shall be designed to assist States and units of gen9 eral local government in using other Federal programs for

10 the purpose of acquiring, rehabilitating, or otherwise par11 ticipating in—

12 (1) the disposition, pursuant to section 203 of

13 the Housing and Community Development Amend14 ments of 1978, of multifamily housing projects owned

15 by the Secretary; or

16 (2) the sale, pursuant to section 203 of the Hous17 ing and Community Development Amendments of

18 1978, of multifamily housing projects subject to mort19 gages held by the Secretary.

20 SEC. 106. PREVENTING MORTGAGE DEFAULTS.

21 (a) MULTIFAMILY HOUSING PLANNING AND INVEST22 MENT STRATEGIES.—

23 (1) PREPARATION OF ASSESSMENTS FOR INDE24 PENDENT ENTITIES.—Section 402(a) of the Housing

25 and Community Development Act of 1992 (12 U.S.C.
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1 1715–1a note) is amended by adding at the end the

2 following: ‘‘The assessment shall be prepared by an

3 entity that does not have an identity of interest with

4 the owner.’’.

5 (2) TIMING OF SUBMISSION OF NEEDS ASSESS6 MENTS.—Section 402(b) of the Housing and Commu7 nity Development Act of 1992 (12 U.S.C. 17152–1a

8 note) is amended to read as follows:

9 ‘‘(b) TIMING.—To ensure that assessments for all cov10 ered multifamily housing properties will be submitted on

11 or before the conclusion of fiscal year 1997, the Secretary

12 shall require the owners of such properties, including cov13 ered multifamily housing properties for the elderly, to sub14 mit the assessments for the properties in accordance with

15 the following schedule:

16 ‘‘(1) For fiscal year 1994, 10 percent of the ag17 gregate number of such properties.

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

19 1997, an additional 30 percent of the aggregate num20 ber of such properties.’’.

21 (3) REVIEW OF COMPREHENSIVE NEEDS ASSESS22 MENTS.—Section 404(d) of the Housing and Commu23 nity Development Act of 1992 (12 U.S.C. 1715–1a

24 note) is amended to read as follows:

25 ‘‘(d) REVIEW.—
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1 ‘‘(1) IN GENERAL.—The Secretary shall review

2 each comprehensive needs assessment for completeness

3 and adequacy before the expiration of the 90-day pe4 riod beginning on the receipt of the assessment.

5 ‘‘(2) INCOMPLETE OR INADEQUATE ASSESS6 MENTS.—If the Secretary determines that the assess7 ment is substantially incomplete or inadequate, the

8 Secretary shall—

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

10 amount of time to resubmit an amended assess11 ment; and

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

13 the original assessment requiring completion or

14 other revision.’’.

15 (4) REPEAL OF NOTICE PROVISION.—Section

16 404(f) of the Housing and Community Development

17 Act of 1992 (12 U.S.C. 1715–1a note) is hereby re18 pealed.

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

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

21 1715z–1a note) is amended by adding at the end the

22 following new section:

23 ‘‘SEC. 409. FUNDING.

24 ‘‘(a) ALLOCATION OF ASSISTANCE.—Based upon needs

25 identified in comprehensive needs assessments, and subject
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1 to otherwise applicable program requirements, including se2 lection criteria, the Secretary may allocate the following as3 sistance to owners of covered multifamily housing projects

4 and may provide such assistance on a noncompetitive basis:

5 ‘‘(1) Operating assistance and capital improve6 ment assistance for troubled multifamily housing

7 projects pursuant to section 201 of the Housing and

8 Community Development Amendments of 1978, except

9 for assistance set aside under section 201(n)(1).

10 ‘‘(2) Loan management assistance available pur11 suant to section 8 of the United States Housing Act

12 of 1937.

13 ‘‘(b) OPERATING ASSISTANCE AND CAPITAL IMPROVE14 MENT ASSISTANCE.—In providing assistance under sub15 section (a) the Secretary shall use the selection criteria set

16 forth in section 201(n) of the Housing and Community De17 velopment Amendments.

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

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

20 capital needs assessment of an owner selected to receive as21 sistance under this section.’’.

22 (b) FLEXIBLE SUBSIDY PROGRAM.—

23 (1) DELETION OF UTILITY COST REQUIRE24 MENTS.—Section 201(i) of the Housing and Commu-
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1 nity Development Amendments of 1978 (12 U.S.C.

2 1715z–1a(i)) is hereby repealed.

3 (2) REPEAL OF MANDATORY CONTRIBUTION

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

5 Community Development Amendments of 1978 (12

6 U.S.C. 1715z–1a(k)(2)) is amended by striking ‘‘, ex7 cept that’’ and all that follows through ‘‘such loan’’.

8 (3) FUNDING.—Section 201(n) of the Housing

9 and Community Development Amendments of 1978

10 (42 U.S.C. 1715z–1a(n)) is amended to read as fol11 lows:

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

13 contracting to provide, assistance for capital improvements

14 under this section, the Secretary shall set aside an amount,

15 as determined by the Secretary, for projects that are eligible

16 for incentives under section 224(b) of the Emergency Low

17 Income Housing Preservation Act of 1987, as such section

18 existed before the date of enactment of the Cranston-Gon19 zalez National Affordable Housing Act. The Secretary may

20 make such assistance available on a noncompetitive basis.

21 ‘‘(2) Except as provided in paragraph (3), with respect

22 to assistance under this section not set aside for projects

23 under paragraph (1), the Secretary—

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

25 basis; and
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1 ‘‘(B) shall award assistance to eligible projects

2 on the basis of—

3 ‘‘(i) the extent to which the project is phys4 ically or financially troubled, as evidenced by the

5 comprehensive needs assessment submitted in ac6 cordance with title IV of the Housing and Com7 munity Development Act of 1992; and

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

9 necessary and reasonable to prevent the default

10 of federally insured mortgages.

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

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

13 of assistance to eligible projects based upon—

14 ‘‘(A) the extent to which such assistance is nec15 essary to prevent the imminent foreclosure or default

16 of a project whose owner has not submitted a com17 prehensive needs assessment pursuant to title IV of

18 the Housing and Community Development Act of

19 1992;

20 ‘‘(B) the extent to which the project presents an

21 imminent threat to the life, health, and safety of

22 project residents; or

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

24 specify by regulation or by notice printed in the Fed25 eral Register.
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1 ‘‘(4) In providing assistance under this section, the

2 Secretary shall take into consideration—

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

4 there will be significant opportunities for residents

5 (including a resident council or resident management

6 corporation, as appropriate) to be involved in the

7 management of the project (except that this para8 graph shall have no application to projects that are

9 owned as cooperatives); and

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

11 the project owner has provided competent manage12 ment and complied with all regulatory and adminis13 trative instructions (including such instructions with

14 respect to the comprehensive servicing of multifamily

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

16 (c) IMPLEMENTATION AND EFFECTIVE DATE FOR SUB17 SECTIONS (a) AND (b).—

18 (1) IN GENERAL.—The Secretary shall, by notice

19 published in the Federal Register, which shall take ef20 fect upon publication, establish such requirements as

21 may be necessary to implement the amendments made

22 by subsections (a) and (b). The notice shall invite

23 public comments and, not later than 12 months after

24 the date on which the notice is published, the Sec25 retary shall issue final regulations based on the ini-
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1 tial notice, taking into account any public comments

2 received.

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

4 shall describe the method by which the Secretary allo5 cates assistance in accordance with section 409 of the

6 Housing and Community Development Act of 1992

7 (as added by section 106(a) of this Act) and para8 graphs (2) and (3) of section 201(n) of the Housing

9 and Community Development Amendments of 1978.

10 (3) ANNUAL PUBLICATIONS.—The Secretary shall

11 publish annually in the Federal Register—

12 (A) the method by which the Secretary de13 termines which capital needs assessments will be

14 received each year, in accordance with sections

15 402(b) and 404(d) of the Housing and Commu16 nity Development Act of 1992; and

17 (B) a list of all owners of covered multifam18 ily housing projects, by project, that have re19 ceived funding under—

20 (i) section 409 of the Housing and

21 Community Development Act of 1992 (as

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

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

24 201(n) of the Housing and Community De25 velopment Amendments of 1978.
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1 (4) EFFECTIVE DATE.—

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

3 subparagraph (B), the amendments made by

4 subsections (a) and (b) shall take effect for

5 amounts made available for fiscal year 1995.

6 (B) EXCEPTION.—Notwithstanding sub7 paragraph (A), section 201(n)(1) of the Housing

8 and Community Development Amendments of

9 1978 (as added by subsection (b)(3)) shall take

10 effect on the date of enactment of this Act.

11 (d) STREAMLINED REFINANCING.—As soon as prac12 ticable, the Secretary shall implement a streamlined refi13 nancing program under the authority provided in section

14 223 of the National Housing Act to prevent the default of

15 mortgages insured by the FHA which cover multifamily

16 housing projects, as defined in section 203(b) of the Housing

17 and Community Development Amendments of 1978.

18 (e) PARTIAL PAYMENTS OF CLAIM.—

19 (1) IN GENERAL.—Notwithstanding any other

20 provision of law, if the Secretary is requested to ac21 cept assignment of a mortgage insured by the Sec22 retary that covers a multifamily housing project, as

23 such term is defined in section 203(b) of the Housing

24 and Community Development Amendments of 1978,

25 and the Secretary determines that partial payment
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1 would be less costly to the Federal Government than

2 other reasonable alternatives for maintaining the low3 income character of the project, the Secretary may re4 quest the mortgagee, in lieu of assignment, to—

5 (A) accept partial payment of the claim

6 under the mortgage insurance contract; and

7 (B) recast the mortgage, under such terms

8 and conditions as the Secretary may determine.

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

10 claim payment under this section, the mortgagor shall

11 agree to repay to the Secretary the amount of such

12 payment and such obligation shall be secured by a

13 second mortgage on the property on such terms and

14 conditions as the Secretary may determine.

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

16 (1) IN GENERAL.—Not later than June 1, 1994,

17 the Comptroller General of the United States shall

18 submit to the Committee on Banking, Housing, and

19 Urban Affairs of the Senate and the Committee on

20 Banking, Finance and Urban Affairs of the House of

21 Representatives a report that evaluates the adequacy

22 of loan loss reserves in the General Insurance and

23 Special Risk Insurance Funds and presents rec24 ommendations for the Secretary to prevent losses from

25 occurring.
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1 (2) CONTENTS.—The report submitted under

2 paragraph (1) shall—

3 (A) evaluate the factors considered in arriv4 ing at loss estimates and determine whether

5 other factors should be considered;

6 (B) determine the relative benefit of creat7 ing a new, actuarially sound insurance fund for

8 all new multifamily housing insurance commit9 ments; and

10 (C) recommend alternatives to the Sec11 retary’s current procedures for preventing the fu12 ture default of multifamily housing project mort13 gages insured under title II of the National

14 Housing Act.

15 (g) GAO STUDY ON ACTUARIAL SOUNDNESS OF CER16 TAIN INSURANCE PROGRAMS.—

17 (1) IN GENERAL.—Not later than June 1, 1994,

18 the Comptroller General of the United States shall

19 submit to the Committee on Banking, Housing, and

20 Urban Affairs of the Senate and the Committee on

21 Banking, Finance and Urban Affairs of the House of

22 Representatives a report that evaluates, in connection

23 with the General Insurance Fund, the role and per24 formance of the nursing home, hospital, and retire25 ment service center insurance programs.
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1 (2) CONTENTS.—The reports submitted under

2 paragraph (1) shall—

3 (A) evaluate the strategic importance of

4 these insurance programs to the mission of the

5 FHA;

6 (B) evaluate the impact of these insurance

7 programs upon the financial performance of the

8 General Insurance Fund;

9 (C) assess the potential losses expected

10 under these programs through fiscal year 1999;

11 (D) evaluate the risk of these programs to

12 the General Insurance Fund in connection with

13 changes in national health care policy;

14 (E) assess the ability of the FHA to manage

15 these programs; and

16 (F) make recommendations for any nec17 essary changes.

18 (h) ANNUAL ACTUARIAL REVIEW.—

19 (1) SPECIAL RISK INSURANCE FUND.—Section

20 238(c) of the National Housing Act (12 U.S.C.

21 1715z–3(c)) is amended by adding at the end the fol22 lowing new paragraph:

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

24 review of the actuarial soundness of each of the insur25 ance programs comprising the Special Risk Insurance
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1 Fund, and shall present findings from such review to

2 the Congress in the FHA Annual Management Re3 port.’’.

4 (2) GENERAL INSURANCE FUND.—Section 519 of

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

6 amended by adding at the end the following new sub7 section:

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

9 shall undertake an annual review of the actuarial soundness

10 of each of the insurance programs comprising the General

11 Insurance Fund, and shall present findings from such re12 view to the Congress in the FHA Annual Management Re13 port.’’.

14 (i) ALTERNATIVE USES FOR PREVENTION OF DE15 FAULT.—

16 (1) IN GENERAL.—Subject to notice and com17 ment from existing tenants, to prevent the imminent

18 default of a multifamily housing project subject to a

19 mortgage insured under title II of the National Hous20 ing Act, the Secretary may authorize the mortgagor

21 to use the project for purposes not contemplated by or

22 permitted under the regulatory 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 Secretary

13 shall—

14 (A) make available tenant-based assistance

15 under section 8 of the United States Housing Act

16 of 1937 to any tenant displaced as a result of ac17 tions taken by the Secretary pursuant to para18 graph (1); and

19 (B) take such actions as the Secretary deter20 mines necessary to ensure the successful use of

21 any tenant-based assistance provided under this

22 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 invite

3 public comments and, not later than 12 months after

4 the date on which the notice is published, the Sec5 retary shall issue final regulations based on the ini6 tial notice, taking into account any public comments

7 received.

8 (j) MORTGAGE SALE DEMONSTRATION.—The Sec9 retary may carry out a demonstration to test the feasibility

10 of restructuring and disposing of troubled multifamily

11 mortgages held by the Secretary through the establishment

12 of partnerships between public, private, and nonprofit enti13 ties.

14 (k) NATIONAL INTERAGENCY TASK FORCE ON MULTI15 FAMILY HOUSING.—

16 (1) FUNCTIONS.—Section 543(e)(1) of the Hous17 ing and Community Development Act of 1992 (12

18 U.S.C. 1707 note) is amended—

19 (A) in subparagraph (D), by striking ‘‘and’’

20 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.—Sec8 tion 543(h) of the Housing and Community Develop9 ment Act of 1992 is amended by inserting after the

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

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

12 authority provided for salaries and expenses in ap13 propriations Acts for activities carried out under this

14 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 amended

18 by striking the first semicolon, and all that follows through

19 ‘‘as determined by the Secretary’’.

20 SEC. 108. AUTHORIZATION OF APPROPRIATIONS.

21 (a) SPECIAL RISK INSURANCE FUND.—Section 238(b)

22 of the National Housing Act (12 U.S.C. 1715z–3(b)) is

23 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 by

3 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 following

7 new section:

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

10 ‘‘There are authorized to be appropriated $350,000,000

11 for fiscal year 1994 and $360,500,000 for fiscal year 1995,

12 to be allocated in any manner that the Secretary determines

13 appropriate, for the following costs incurred in conjunction

14 with programs authorized under the General Insurance

15 Fund, as provided by section 519, and the Special Risk In16 surance Fund, as provided by section 238:

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

18 section 502 of the Congressional Budget Act, of new

19 insurance commitments.

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

21 section 502 of the Congressional Budget Act, of modi22 fications to existing loans, loan guarantees, or insur23 ance commitments.

24 ‘‘(3) The cost to the Government, as defined in

25 section 502 of the Congressional Budget Act, of loans
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1 provided under section 203(f) of the Housing and

2 Community Development Amendments of 1978.

3 ‘‘(4) The costs of the rehabilitation of multifam4 ily housing projects (as defined in section 203(b) of

5 the Housing and Community Development Amend6 ments of 1978) upon disposition by the Secretary.’’.

7 TITLE II—ENHANCED PROGRAM

8 FLEXIBILITY

9 Subtitle A—Office of Public and

10 Indian Housing

11 SEC. 201. REVITALIZATION OF SEVERELY DISTRESSED PUB12 LIC HOUSING.

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

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

15 (1) by amending subsection (b) to read as fol16 lows:

17 ‘‘(b) [RESERVED].’’;

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

19 and inserting ‘‘$500,000’’;

20 (3) in subsection (c)(3)—

21 (A) by redesignating subparagraphs (E)

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

23 respectively;

24 (B) by inserting after subparagraph (D) the

25 following new subparagraph:
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1 ‘‘(E) planning for community service and

2 support service activities to be carried out by the

3 public housing agency, residents, members of the

4 community, and other persons and organizations

5 willing to contribute to the social, economic, or

6 physical improvement of the community (com7 munity service is a required element of the revi8 talization program);’’; and

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

10 by striking ‘‘designing a suitable replacement

11 housing plan,’’ and inserting ‘‘designing suitable

12 relocation and replacement housing plans,’’;

13 (4) in subsection (c)(4)—

14 (A) by redesignating subparagraphs (D)

15 and (E) as subparagraphs (E) and (F), respec16 tively; and

17 (B) by inserting after subparagraph (C) the

18 following new subparagraph:

19 ‘‘(D) a description of the community service

20 and support service planning activities to be car21 ried out by the public housing agency, residents,

22 members of the community, and other persons

23 and organizations willing to contribute to the so24 cial, economic, or physical improvement of the

25 community;’’;
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1 (5) in subsection (c)(5)—

2 (A) by striking subparagraph (E) and re3 designating subparagraphs (F) and (G) as sub4 paragraphs (E) and (F), accordingly;

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

6 by inserting before the semicolon ‘‘, taking into

7 account the condition of the stock of the public

8 housing agency as a whole’’; and

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

10 ‘‘In making grants under this subsection, the Sec11 retary may select a lower-rated, approvable applica12 tion over a higher-rated application to increase the

13 national geographic diversity among applications ap14 proved under this section.’’;

15 (6) in subsection (d)(2)—

16 (A) by redesignating subparagraphs (E)

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

18 respectively;

19 (B) by inserting after subparagraph (D) the

20 following new subparagraphs:

21 ‘‘(E) community service activities to be car22 ried out by residents, members of the community,

23 and other persons willing to contribute to the so24 cial, economic, or physical improvement of the
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1 community (community service is a required ele2 ment of the revitalization program);

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

4 and

5 (C) in subparagraph (K), as redesignated—

6 (i) by striking ‘‘15 percent’’ and in7 serting ‘‘20 percent’’; and

8 (ii) by inserting before the period at

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

10 amount equal to 15 percent of the amount

11 of any grant under this subsection used for

12 support services shall be contributed from

13 non-Federal sources (which contribution

14 shall be in the form of cash, administrative

15 costs, and the reasonable value of in-kind

16 contributions and may include funding

17 under title I of the Housing and Commu18 nity Development Act of 1974)’’;

19 (7) in subsection (d)(3)—

20 (A) by redesignating subparagraphs (D)

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

23 (B) by inserting after subparagraph (C) the

24 following new subparagraph:
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1 ‘‘(D) a description of the community service

2 and support service activities to be carried out

3 by the public housing agency, residents, members

4 of the community, and other persons and organi5 zations willing to contribute to the social, eco6 nomic, or physical improvement of the commu7 nity;’’;

8 (8) in subsection (d)(4)—

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

10 ‘‘(with assistance from the Department of Hous11 ing and Urban Development if necessary)’’ after

12 ‘‘applicant’’;

13 (B) by striking subparagraph (E) and re14 designating subparagraphs (F) and (G) as sub15 paragraphs (E) and (F), respectively;

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

17 by inserting before the semicolon ‘‘, taking into

18 account the condition of the applicant’s stock as

19 a whole’’; and

20 (D) by adding at the end the following:

21 ‘‘In making grants under this subsection, the Sec22 retary may select a lower-rated, approvable applica23 tion over a higher-rated application to increase the

24 national geographic diversity among applications ap25 proved under this section.’’;
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1 (9) in subsection (e), by adding at the end the

2 following new paragraph:

3 ‘‘(3) DEMOLITION AND REPLACEMENT.—

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

5 other applicable law or regulation, a revitaliza6 tion plan under this section may include demoli7 tion and replacement on site or in the same

8 neighborhood if the number of replacement units

9 provided in the same neighborhood is fewer than

10 the number of units demolished as a result of the

11 revitalization effort.

12 ‘‘(B) TENANT-BASED ASSISTANCE.—Not13 withstanding the limitations contained in sub14 paragraph (A)(v) or (C) of section 18(b)(3), a

15 public housing agency may replace not more

16 than one-third of the units demolished or dis17 posed of through a revitalization project under

18 this section with tenant-based assistance under

19 section 8.’’;

20 (10) in subsection (h)—

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

22 follows:

23 ‘‘(5) SEVERELY DISTRESSED PUBLIC HOUSING.—

24 The term ‘severely distressed public housing’ means a

25 public housing project or a building in a project—
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1 ‘‘(A) that requires major redesign, recon2 struction, redevelopment, or partial or total dem3 olition to correct serious deficiencies in the origi4 nal design (including inappropriately high pop5 ulation density), deferred maintenance, physical

6 deterioration or obsolescence of major systems,

7 and other deficiencies in the physical plant of

8 the project; and

9 ‘‘(B) that either—

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

11 families with children that have extremely

12 low incomes, high rates of unemployment,

13 and extensive dependency on various forms

14 of public assistance; and

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

16 criminal activity (including drug-related

17 criminal activity); or

18 ‘‘(ii) that has a vacancy rate, as deter19 mined by the Secretary, of 50 percent or

20 more;

21 ‘‘(C) that cannot be revitalized through as22 sistance under other programs, such as the pro23 grams under sections 9 and 14, or through other

24 administrative means because of the inadequacy

25 of available funds; and
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1 ‘‘(D) that, in the case of individual build2 ings, the building is, in the Secretary’s deter3 mination, sufficiently separable from the re4 mainder of the project to make use of the build5 ing feasible for purposes of this section.’’; and

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

7 paragraphs:

8 ‘‘(6) COMMUNITY SERVICE.—The term ‘commu9 nity service’ means services provided on a volunteer

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

11 physical improvement of the community to be served.

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

13 services’ includes all activities designed to lead to14 ward upward mobility, self-sufficiency, and improved

15 quality of life for the residents of the project, such as

16 literacy training, job training, day care, and eco17 nomic development. Such activities may allow for the

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

19 (11) in subsection (i)—

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

21 (B) by redesignating paragraphs (3) and

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

23 (b) CONFORMING AMENDMENT.—The first sentence of

24 section 25(m)(1) of the United States Housing Act of 1937

25 (42 U.S.C. 1437w(m)(1)) is amended to read as follows:
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1 ‘‘(1) The term ‘eligible housing’ means a public

2 housing project, or one or more buildings within a

3 project, that is owned or operated by a public housing

4 agency that has been troubled for not less than 3

5 years and that, as determined by the Secretary, has

6 failed to make substantial progress toward effective

7 management.’’.

8 (c) USE OF TENANT-BASED ASSISTANCE FOR RE9 PLACEMENT HOUSING.—Section 18(b)(3)(C)(i) of the

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

11 1437p(b)(3)(C)(i)) is amended by striking ‘‘15-year’’.

12 (d) REPLACEMENT HOUSING OUTSIDE THE JURISDIC13 TION OF THE PHA.—Section 18(b)(3) of the United States

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

15 by subsection (c), is amended—

16 (1) by redesignating subparagraphs (D) through

17 (H) as subparagraphs (E) through (I), respectively;

18 and

19 (2) by inserting after subparagraph (C) the fol20 lowing new subparagraph:

21 ‘‘(D) may provide that all or part of such addi22 tional dwelling units may be located outside of the ju23 risdiction of the public housing agency (the ‘original

24 agency’) if—
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1 ‘‘(i) the location is in the same housing

2 market area as the original agency, as deter3 mined by the Secretary;

4 ‘‘(ii) the plan contains an agreement be5 tween the original agency and the public housing

6 agency in the alternate location or other public

7 or private entity that will be responsible for pro8 viding the additional units in the alternate loca9 tion (‘alternate agency or entity’) that the alter10 nate agency or entity will, with respect to the

11 dwelling units involved—

12 ‘‘(I) provide the dwelling units in ac13 cordance with subparagraph (A);

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

15 accordance with subparagraph (F);

16 ‘‘(III) meet the requirements of sub17 paragraph (G) and the maximum rent pro18 visions of subparagraph (H); and

19 ‘‘(IV) not impose a local residency

20 preference on any resident of the jurisdic21 tion of the original agency for purposes of

22 admission to any such units; and

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

24 unit of general local government for the jurisdic-
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1 tion in which the additional units will be lo2 cated;’’.

3 SEC. 202. DISALLOWANCE OF EARNED INCOME FOR RESI4 DENTS WHO OBTAIN EMPLOYMENT.

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

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

7 (1) by striking the undesignated paragraph at

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

9 515(b) of the Cranston-Gonzalez National Affordable

10 Housing Act); and

11 (2) by adding at the end the following new sub12 section:

13 ‘‘(d) DISALLOWANCE OF EARNED INCOME FROM PUB14 LIC HOUSING RENT DETERMINATIONS.—Notwithstanding

15 any other provision of law, the rent payable under sub16 section (a) for any public housing unit by a family whose

17 income increases as a result of employment of a member

18 of the family who was previously unemployed for one or

19 more years (including a family whose income increases as

20 a result of the participation of a family member in the

21 Family Self-Sufficiency program or other job training pro22 gram) shall not be increased for a period of 18 months, be23 ginning with the commencement of employment as a result

24 of the increased income due to such employment. After the

25 expiration of the 18-month period, rent increases due to the
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1 continued employment of such family member shall be lim2 ited to 10 percent per year. In no case shall rent exceed

3 the amount determined under subsection (a).’’.

4 (b) APPLICABILITY OF AMENDMENT.—Notwithstand5 ing the amendment made by subsection (a), any resident

6 of public housing participating in the program under the

7 authority contained in the undesignated paragraph at the

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

9 1937 as such paragraph existed before the date of enactment

10 of this subsection shall continue to be governed by such au11 thority.

12 SEC. 203. CEILING RENTS BASED ON REASONABLE RENTAL

13 VALUE.

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

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

16 1437a(a)(2)(A)(iii)) is amended to read as follows:

17 ‘‘(iii) is not less than the reasonable rental value

18 of the unit, as determined by the Secretary.’’.

19 (b) REGULATIONS.—

20 (1) IN GENERAL.—The Secretary shall, by regu21 lation, after notice and an opportunity for public

22 comment, establish such requirements as may be nec23 essary to carry out the provisions of section

24 3(a)(2)(A) of the United States Housing Act of 1937,

25 as amended by subsection (a).
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1 (2) APPLICABILITY.—Except in the case of an

2 Indian housing authority, the regulations issued pur3 suant to paragraph (1) shall not apply to scattered

4 site public housing units.

5 (3) TRANSITION RULE.—Prior to the issuance of

6 final regulations under paragraph (1), a public hous7 ing agency may implement ceiling rents which shall

8 be—

9 (A) determined in accordance with section

10 3(a)(2)(A) of the United States Housing Act of

11 1937, as such section existed before the date of

12 enactment of this Act; or

13 (B) equal to the 95th percentile of the rent

14 paid for a unit of comparable size by tenants in

15 the same project or a group of comparable

16 projects totaling 50 units or more.

17 SEC. 204. RESIDENT MANAGEMENT PROGRAM.

18 Section 20(f) of the United States Housing Act of 1937

19 (42 U.S.C. 1437r(f)) is amended—

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

21 and inserting ‘‘$250,000’’; and

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

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

24 percent of the amounts made available under this sub-
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1 section for program monitoring and evaluation, tech2 nical assistance, and information dissemination.’’.

3 Subtitle B—Office of Community

4 Planning and Development

5 SEC. 211. ECONOMIC DEVELOPMENT INITIATIVE.

6 (a) SECTION 108 ELIGIBLE ACTIVITIES.—

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

8 and Community Development Act of 1974 (42 U.S.C.

9 5308(a)) is amended—

10 (A) in the first sentence—

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

12 105(a);’’; and

13 (ii) by inserting before the period the

14 following: ‘‘; (5) the acquisition, construc15 tion, reconstruction, or installation of pub16 lic facilities (except for buildings for the

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

18 the case of colonias, public works and site

19 or other improvements’’; and

20 (B) by striking the second sentence and in21 serting the following: ‘‘A guarantee under this

22 section (including a guarantee combined with a

23 grant under subsection (q)) may be used to assist

24 a grantee in obtaining financing only if the

25 grantee has made efforts to obtain the financing
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•S 1299 RS

1 without the use of the guarantee (and, if applica2 ble, the grant) and cannot complete the financing

3 consistent with the timely execution of the pro4 posed activities and projects without the guaran5 tee (or, if applicable, the grant).’’.

6 (2) DEFINITION.—Section 102(a) of the Housing

7 and Community Development Act of 1974 (42 U.S.C.

8 5302(a)) is amended by adding at the end the follow9 ing new paragraph:

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

11 community that—

12 ‘‘(A) is in the State of Arizona, California,

13 New Mexico, or Texas;

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

15 region;

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

17 basis of objective criteria, including lack of pota18 ble water supply, lack of adequate sewage sys19 tems, and lack of decent, safe, and sanitary hous20 ing; and

21 ‘‘(D) was in existence as a colonia before the

22 date of the enactment of the Cranston-Gonzalez

23 National Affordable Housing Act.’’.

24 (b) ECONOMIC DEVELOPMENT GRANTS.—
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1 (1) IN GENERAL.—Section 108 of the Housing

2 and Community Development Act of 1974 (42 U.S.C.

3 5308) is amended by adding at the end the following

4 new subsection:

5 ‘‘(q) ECONOMIC DEVELOPMENT GRANTS.—

6 ‘‘(1) AUTHORIZATION.—The Secretary may make

7 grants in connection with notes or other obligations

8 guaranteed under this section to eligible public enti9 ties for the purpose of enhancing the security of loans

10 guaranteed under this section or improving the via11 bility of projects financed with loans guaranteed

12 under this section.

13 ‘‘(2) ELIGIBLE ACTIVITIES.—Assistance under

14 this subsection may be used for the purposes of and

15 in conjunction with projects and activities assisted

16 under subsection (a).

17 ‘‘(3) APPLICATIONS.—Applications for assistance

18 under this subsection shall be submitted by eligible

19 public entities in the form and in accordance with the

20 procedures established by the Secretary. Eligible pub21 lic entities may apply for grants only in conjunction

22 with a request for guarantee under subsection (a).

23 ‘‘(4) SELECTION CRITERIA.—The Secretary shall

24 establish criteria for awarding assistance under this

25 subsection. Such criteria shall include—
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1 ‘‘(A) the extent of need for such assistance;

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

3 to be served and in the jurisdiction applying for

4 assistance;

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

6 the capacity or potential capacity of the appli7 cant to successfully carry out the plan; and

8 ‘‘(D) such other factors as the Secretary de9 termines to be appropriate.’’.

10 (2) CONFORMING AMENDMENT.—Title I of the

11 Housing and Community Development Act of 1974

12 (42 U.S.C. 5301 et seq.) is amended—

13 (A) in section 101(c) in the second sentence,

14 by inserting ‘‘or a grant’’ after ‘‘guarantee’’; and

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

16 grant’’ after ‘‘guarantee’’.

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

18 the Housing and Community Development Act of 1974 (42

19 U.S.C. 5318(o)) is amended by inserting before the period

20 the following: ‘‘, except that amounts available to the Sec21 retary for use under this subsection as of October 1, 1993,

22 and amounts released to the Secretary pursuant to sub23 section (t) may be used to provide grants under section

24 108(q).’’.

25 (d) UDAG AMNESTY PROGRAM.—
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1 (1) AMENDMENT.—Section 119 of the Housing

2 and Community Development Act of 1974 (42 U.S.C.

3 5318) is amended by adding at the end the following

4 new subsection:

5 ‘‘(t) UDAG AMNESTY PROGRAM.—If a grant or a por6 tion of a grant under this section remains unexpended as

7 of the issuance of a notice implementing this subsection, the

8 grantee may enter into an agreement, as provided under

9 this subsection, with the Secretary to receive a percentage

10 of the grant amount and relinquish all claims to the balance

11 of the grant within 90 days of the issuance of notice imple12 menting this subsection (or such later date as the Secretary

13 may approve). The Secretary shall not recapture any funds

14 obligated pursuant to this section during a period begin15 ning on the date of enactment of the Housing and Commu16 nity Development Act of 1993 until 90 days after the issu17 ance of a notice implementing this subsection. A grantee

18 may receive as a grant under this subsection—

19 ‘‘(1) 33 percent of such unexpended amounts if—

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

21 than one-half of the amount received for activi22 ties authorized pursuant to section 108(q) and to

23 expend such funds in conjunction with a loan

24 guarantee made under section 108 at least equal

25 to twice the amount of the funds received; and
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1 ‘‘(B)(i) the remainder of the amount re2 ceived is used for economic development activi3 ties eligible under title I of this Act; and

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

5 in the case of a severely distressed jurisdiction,

6 not more than one-half of the costs of activities

7 under subparagraph (B) are derived from such

8 unexpended amounts; or

9 ‘‘(2) 25 percent of such unexpended amounts if—

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

11 funds for economic development activities eligible

12 under title I of this Act; and

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

14 in the case of a severely distressed jurisdiction,

15 not more than one-half of the costs of such activi16 ties are derived from such unexpended amount.’’.

17 (2) IMPLEMENTATION.—Notwithstanding sub18 section (f), not later than 10 days after the date of

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

20 published in the Federal Register, which shall take ef21 fect upon publication, establish such requirements as

22 may be necessary to implement the amendments made

23 by this subsection.

24 (e) GUARANTEE OF OBLIGATIONS BACKED BY SECTION

25 108 LOANS.—Section 108 of the Housing and Community
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1 Development Act of 1974 (42 U.S.C. 5308), as amended by

2 subsection (b), is amended by adding at the end the follow3 ing new subsection:

4 ‘‘(r) GUARANTEE OF OBLIGATIONS BACKED BY SEC5 TION 108 LOANS.—

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

7 upon such terms and conditions as the Secretary

8 deems appropriate, guarantee the timely payment of

9 the principal of and interest on trust certificates or

10 other obligations that—

11 ‘‘(A) are offered by the Secretary, or by any

12 other offeror approved for purposes of this sub13 section by the Secretary; and

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

15 pool composed of notes or other obligations guar16 anteed by the Secretary under this section.

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

18 STATES.—Subsection (f) shall apply to any guarantee

19 under this subsection.

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

21 claim under a guarantee issued under this section, the

22 Secretary shall be subrogated fully to the rights satis23 fied by such payment.
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1 ‘‘(4) POWERS OF THE SECRETARY.—No Federal,

2 State, or local law shall preclude or limit the exercise

3 by the Secretary of—

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

5 public offerings and other sales of notes, trust

6 certificates, and other obligations guaranteed

7 under this section upon such terms and condi8 tions as the Secretary deems appropriate;

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

10 deemed appropriate by the Secretary any such

11 contract; and

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

13 applicable, in notes, certificates, or other obliga14 tions guaranteed under this section, or constitut15 ing the trust or pool against which trust certifi16 cates or other obligations guaranteed under this

17 section are offered.’’.

18 (f) EFFECTIVE DATE.—The Secretary shall, by notice

19 published in the Federal Register, which shall take effect

20 upon publication, establish such requirements as may be

21 necessary to implement the amendments made by this sec22 tion. The notice shall invite public comments and, not later

23 than 12 months after the date on which the notice is pub24 lished, the Secretary shall issue final regulations based on
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1 the initial notice, taking into account any public comments

2 received.

3 SEC. 212. HOME INVESTMENT PARTNERSHIPS.

4 (a) PARTICIPATION BY STATE AGENCIES OR INSTRU5 MENTALITIES.—Section 104(2) of the Cranston-Gonzalez

6 National Affordable Housing Act (42 U.S.C. 12704(2)) is

7 amended by inserting before the period at the end the follow8 ing: ‘‘, or any agency or instrumentality thereof that is es9 tablished pursuant to legislation and designated by the chief

10 executive to act on behalf of the State with regard to the

11 provisions of this Act’’.

12 (b) SIMPLIFY PROGRAM-WIDE INCOME TARGETING

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

14 Cranston-Gonzalez National Affordable Housing Act (42

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

16 invested with respect to dwelling units that are occupied

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

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

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

20 in each such place.

21 (c) REMOVE FIRST-TIME HOMEBUYER LIMITATION

22 FOR HOME UNITS.—Section 215(b) of the Cranston-Gon23 zalez National Affordable Housing Act (42 U.S.C. 12745(b))

24 is amended by striking paragraph (3) and redesignating
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1 paragraphs (4) and (5) as paragraphs (3) and (4), respec2 tively.

3 (d) SIMPLIFY RESALE PROVISIONS.—Section

4 215(b)(3)(B) of the Cranston-Gonzalez National Affordable

5 Housing Act (42 U.S.C. 12745(b)(4)(B)), as redesignated

6 by subsection (c), is amended by striking ‘‘subsection’’ and

7 inserting ‘‘title’’.

8 (e) STABILIZATION OF HOME FUNDING THRESH9 OLDS.—The Cranston-Gonzalez National Affordable Hous10 ing Act (42 U.S.C. 12701 et seq.) is amended—

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

12 (2) in section 217(b), by striking paragraph (4);

13 (3) in section 217(b)(3)—

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

15 those jurisdictions’’ and all that follows through

16 ‘‘allocation’’ and inserting ‘‘jurisdictions that

17 are not participating jurisdictions that are allo18 cated an amount of $500,000 or more and juris19 dictions that are participating jurisdictions shall

20 receive an allocation’’; and

21 (B) in the last sentence, by striking ‘‘, ex22 cept as provided in paragraph (4)’’; and

23 (4) in section 216—
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1 (A) in paragraph (3)(A), by striking ‘‘Ex2 cept as provided in paragraph (10), a jurisdic3 tion’’ and inserting ‘‘A jurisdiction’’; and

4 (B) in paragraph (9)(B), by striking ‘‘, ex5 cept as provided in paragraph (10)’’.

6 (f) COMPREHENSIVE AFFORDABLE HOUSING STRAT7 EGY.—

8 (1) HOME PROGRAM.—Section 218(d) of the

9 Cranston-Gonzalez National Affordable Housing Act

10 (42 U.S.C. 12748(d)) is amended in the first sentence,

11 by inserting ‘‘that it is following a current housing

12 affordability strategy that has been approved by the

13 Secretary in accordance with section 105, and’’ after

14 ‘‘certification’’.

15 (2) HOMELESS ASSISTANCE PROGRAMS.—Section

16 401 of the Stewart B. McKinney Homeless Assistance

17 Act (42 U.S.C. 11361) is amended to read as follows:

18 ‘‘SEC. 401. HOUSING AFFORDABILITY STRATEGY.

19 ‘‘(a) REQUIREMENT TO FOLLOW A CHAS.—Assistance

20 may be made available under subtitle B to metropolitan

21 cities, urban counties, and States receiving a formula

22 amount under section 413, only if the jurisdiction certifies

23 that it is following a current housing affordability strategy

24 that has been approved by the Secretary in accordance with
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1 section 105 of the Cranston-Gonzalez National Affordable

2 Housing Act.

3 ‘‘(b) REQUIREMENT FOR CONSISTENCY WITH

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

5 only if the application contains a certification that the pro6 posed project or activities are consistent with the housing

7 affordability strategy of the State or unit of general local

8 government in which the project is located. The certification

9 shall be from the public official responsible for submitting

10 the strategy for the jurisdiction.’’.

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

12 Stewart B. McKinney Homeless Assistance Act (42

13 U.S.C. 11361 et seq.) is amended by striking sections

14 426(a)(2)(F), 434(a)(10), and 454(b)(9).

15 (g) HOME MATCHING REQUIREMENTS.—Section

16 220(a) of the Cranston-Gonzalez National Affordable Hous17 ing Act (42 U.S.C. 12750(a)) is amended to read as follows:

18 ‘‘(a) CONTRIBUTION.—Each participating jurisdiction

19 shall make contributions to housing that qualifies as afford20 able housing under this title that total, throughout a fiscal

21 year, not less than 25 percent of the funds drawn from the

22 jurisdiction’s HOME Investment Trust Fund in that fiscal

23 year. Such contribution shall be in addition to any

24 amounts made available under section 216(3)(A)(ii).’’.
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1 (h) SEPARATE AUDIT REQUIREMENT FOR THE HOME

2 PROGRAM.—Section 283 of the Cranston-Gonzalez National

3 Affordable Housing Act (42 U.S.C. 12833) is amended—

4 (1) by striking the section heading and inserting

5 the following:

6 ‘‘SEC. 283. AUDITS BY THE COMPTROLLER GENERAL.’’;

7 (2) by striking subsection (a);

8 (3) in subsection (b)—

9 (A) by striking ‘‘(b) AUDITS BY THE COMP10 TROLLER GENERAL.—’’; and

11 (B) by redesignating paragraphs (1) and

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

13 (4) in subsection (a), as redesignated by para14 graph (3), by striking the second sentence.

15 (i) HOME ENVIRONMENTAL REVIEW AMENDMENTS.—

16 Section 288 of the Cranston-Gonzalez National Affordable

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

18 (1) in subsection (a)—

19 (A) in the first sentence, by striking ‘‘par20 ticipating jurisdictions’’ and inserting ‘‘jurisdic21 tions, Indian tribes, or insular areas’’; and

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

23 ‘‘The regulations shall—

24 ‘‘(1) provide for the monitoring of environmental

25 reviews performed under this section;
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1 ‘‘(2) at the discretion of the Secretary, facilitate

2 training for the performance of such reviews; and

3 ‘‘(3) establish criteria for the suspension or ter4 mination of the assumption under this section.

5 The Secretary’s duty under this subsection shall not be con6 strued to limit any responsibility assumed by a State or

7 unit of general local government with respect to any par8 ticular release of funds.’’;

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

10 striking ‘‘participating jurisdiction’’ and inserting

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

12 (3) in subsection (c)(4), by striking ‘‘participat13 ing jurisdiction’’ and inserting ‘‘jurisdiction, Indian

14 tribe, or insular area’’; and

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

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

17 inserting the following: ‘‘ASSISTANCE TO UNITS OF

18 GENERAL LOCAL GOVERNMENT FROM A STATE.—In

19 the case of assistance to units of general local govern20 ment from a State’’.

21 (j) USE OF CDBG FUNDS FOR HOME ADMINISTRATIVE

22 EXPENSES.—Section 105(a)(13) of the Housing and Com23 munity Development Act of 1974 (42 U.S.C. 5305(a)(13))

24 is amended by inserting after ‘‘charges related to’’ the fol25 lowing: ‘‘(A) administering the HOME program under title
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1 II of the Cranston-Gonzalez National Affordable Housing

2 Act; and (B)’’.

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

4 of the Housing and Community Development Act of 1974

5 (42 U.S.C. 5305(a)(21)) is amended—

6 (1) by inserting ‘‘in connection with tenant7 based assistance and affordable housing projects as8 sisted under title II of the Cranston-Gonzalez Na9 tional Affordable Housing Act’’ after ‘‘housing coun10 seling’’; and

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

12 through ‘‘any law’’ and inserting ‘‘assisted under title

13 II of the Cranston-Gonzalez National Affordable

14 Housing Act’’.

15 SEC. 213. HOPE MATCH REQUIREMENT.

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

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

18 by striking ‘‘33’’ and inserting ‘‘25’’.

19 SEC. 214. FLEXIBILITY OF CDBG PROGRAM FOR DISASTER

20 AREAS.

21 Title I of the Housing and Community Development

22 Act of 1974 (42 U.S.C. 5301 et seq.) is amended by adding

23 at the end the following new section:
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1 ‘‘SEC. 122. SUSPENSION OF REQUIREMENTS FOR DISASTER

2 AREAS.

3 ‘‘For the duration of time during which an area has

4 been declared a disaster area by the President under title

5 IV of the Robert T. Stafford Disaster Relief and Emergency

6 Assistance Act, the Secretary may suspend all requirements

7 for purposes of assistance under section 106 for that area,

8 except for those related to public notice of funding availabil9 ity, nondiscrimination, fair housing, labor standards, envi10 ronmental standards, and requirements that activities bene11 fit persons of low- and moderate-income.’’.

12 SEC. 215. FLEXIBILITY OF HOME PROGRAM FOR DISASTER

13 AREAS.

14 Title II of the Cranston-Gonzalez National Affordable

15 Housing Act (42 U.S.C. 12721 et seq.) is amended by add16 ing at the end the following new section:

17 ‘‘SEC. 290. SUSPENSION OF REQUIREMENTS FOR DISASTER

18 AREAS.

19 ‘‘For the duration of time during which an area has

20 been declared a disaster area by the President under title

21 IV of the Robert T. Stafford Disaster Relief and Emergency

22 Assistance Act, the Secretary may suspend all requirements

23 for purposes of assistance under this title for that area, ex24 cept for those related to public notice of funding availabil25 ity, nondiscrimination, fair housing, labor standards, envi-
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1 ronmental standards, and low-income housing afford2 ability.’’.

3 Subtitle C—Community

4 Partnerships Against Crime

5 SEC. 221. COMPAC PROGRAM.

6 (a) CONFORMING PROVISIONS.—Section 5001 of the

7 Anti-Drug Abuse Act of 1988 (42 U.S.C. 11901) is amended

8 in the table of contents—

9 (1) by striking the item relating to the heading

10 for chapter 2 and inserting the following:

‘‘CHAPTER 2—COMMUNITY PARTNERSHIPS AGAINST CRIME’’;

11 (2) by striking the item relating to section 5122

12 and inserting the following:

‘‘Sec. 5122. Purposes.’’;

13 and

14 (3) by adding the following after the item relat15 ing to section 5130:

‘‘Sec. 5131. Technical assistance.’’.

16 (b) SHORT TITLE, PURPOSES, AND AUTHORITY TO

17 MAKE GRANTS.—The Public and Assisted Housing Drug

18 Elimination Act of 1990 (42 U.S.C. 11901 et seq.) is

19 amended by striking the chapter heading for chapter 2, and

20 by striking sections 5121, 5122, and 5123 and inserting the

21 following:
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1 ‘‘CHAPTER 2—COMMUNITY PARTNERSHIPS

2 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 fear,

10 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 Assisted

15 Housing Drug Elimination Act of 1990 to apply to

16 all types of crime, and not simply crime that is drug17 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 range

22 of community-based groups, and residents of neigh23 boring housing that is owned or assisted by the Sec24 retary, 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 system

8 to evaluate need among public housing agencies, and

9 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 make

14 grants, for use in eliminating crime in and around public

15 and other federally assisted low-income housing projects (1)

16 to public housing agencies (including Indian housing au17 thorities), and (2) to private, for profit, and nonprofit own18 ers of federally assisted low-income housing. In designing

19 the program, the Secretary shall consult with the Attorney

20 General.’’.

21 (c) ELIGIBLE ACTIVITIES.—Section 5124(a) of the

22 Public and Assisted Housing Drug Elimination Act of 1990

23 (42 U.S.C. 11903(a)) is amended—

24 (1) in the introductory material preceding para25 graph (1), by inserting ‘‘and around’’ after ‘‘used in’’;
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1 (2) in paragraph (3), by inserting ‘‘, such as

2 fencing, lighting, locking, and surveillance systems’’

3 before the semicolon;

4 (3) in paragraph (4), by striking subparagraph

5 (A) and inserting the following new subparagraph:

6 ‘‘(A) to investigate crime; and’’;

7 (4) in paragraph (6)—

8 (A) by striking ‘‘in and around public or

9 other federally assisted low-income housing

10 projects’’; and

11 (B) by striking ‘‘and’’ after the semicolon;

12 (5) in paragraph (7)—

13 (A) by striking ‘‘where a public housing

14 agency receives a grant,’’;

15 (B) by striking ‘‘drug abuse’’ and inserting

16 ‘‘crime’’; and

17 (C) by striking the period at the end and

18 inserting a semicolon; and

19 (6) by adding at the end the following new para20 graphs:

21 ‘‘(8) the employment or utilization of one or

22 more individuals, including law enforcement officers,

23 made available by contract or other cooperative ar24 rangement with State or local law enforcement agen25 cies, to engage in community policing involving inter-
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1 action with members of the community on proactive

2 crime control and prevention;

3 ‘‘(9) youth initiatives, such as activities involv4 ing training, education, after school programs, cul5 tural programs, recreation and sports, career plan6 ning, and entrepreneurship and employment; and

7 ‘‘(10) resident service programs, such as job

8 training, education programs, drug and alcohol treat9 ment, and other appropriate social services that ad10 dress the contributing factors of crime.’’.

11 (d) APPLICATIONS.—Section 5125 of the Public and

12 Assisted Housing Drug Elimination Act of 1990 (42 U.S.C.

13 11904) is amended—

14 (1) in subsection (a)—

15 (A) by striking ‘‘To receive a grant’’ and

16 inserting the following:

17 ‘‘(1) APPLICATIONS.—To receive a grant’’;

18 (B) in the second sentence, by striking

19 ‘‘drug-related crime on the premises of’’ and in20 serting the following: ‘‘crime in and around’’;

21 and

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

23 paragraphs:

24 ‘‘(2) ONE-YEAR RENEWABLE GRANTS.—
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1 ‘‘(A) IN GENERAL.—Eligible applicants

2 may submit an application for a 1-year grant

3 under this chapter that, subject to the availabil4 ity of appropriated amounts, shall be renewed

5 annually for a period of not more than 4 years,

6 if the Secretary finds, after an annual or more

7 frequent performance review, that the public

8 housing agency is performing under the terms of

9 the grant and applicable laws in a satisfactory

10 manner and meets such other requirements as

11 the Secretary may prescribe.

12 ‘‘(B) PREFERENCE.—The Secretary shall

13 accord a preference to applicants for grants

14 under this paragraph if the grant is to be used

15 to continue or expand activities eligible for as16 sistance under this chapter that have received

17 previous assistance either under this chapter, as

18 it existed prior to the enactment of the Housing

19 and Community Development Act of 1993, or

20 under section 14 of the United States Housing

21 Act of 1937. Such preference shall not unreason22 ably prejudice the opportunity for other public

23 housing agencies to receive grants under this

24 chapter.
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1 ‘‘(3) PUBLIC HOUSING AGENCIES THAT HAVE ES2 PECIALLY SEVERE CRIME PROBLEMS.—The Secretary

3 shall, by regulation issued after notice and oppor4 tunity for public comment, set forth criteria for estab5 lishing a class of public housing agencies that have es6 pecially severe crime problems. The Secretary may al7 locate a portion of the annual appropriation for this

8 program for public housing agencies in this class.’’.

9 (2) in subsection (b)—

10 (A) by striking the introductory material

11 preceding paragraph (1) and inserting the fol12 lowing: ‘‘The Secretary shall approve applica13 tions under subsection (a)(2) that are not subject

14 to a preference under subsection (a)(2)(B) on the

15 basis of—’’;

16 (B) in paragraph (1), by striking ‘‘drug-re17 lated crime problem in’’ and inserting the follow18 ing: ‘‘crime problem in and around’’;

19 (C) in paragraph (2), by inserting imme20 diately after ‘‘crime problem in’’ the following:

21 ‘‘and around’’; and

22 (D) in paragraph (4), by inserting after

23 ‘‘local government’’ the following: ‘‘, local com24 munity-based nonprofit organizations, local resi25 dent organizations that represent the residents of
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1 neighboring projects that are owned or assisted

2 by the Secretary,’’;

3 (3) in subsection (c)(2), by striking ‘‘drug-relat4 ed’’ each place it appears; and

5 (4) by striking subsection (d).

6 (e) DEFINITIONS.—Section 5126 of the Public and As7 sisted Housing Drug Elimination Act of 1990 (42 U.S.C.

8 11905) is amended by striking paragraphs (1) and (2), and

9 redesignating paragraphs (3) and (4) as paragraphs (1)

10 and (2), respectively.

11 (f) IMPLEMENTATION.—Section 5127 of the Public and

12 Assisted Housing Drug Elimination Act of 1990 (42 U.S.C.

13 11906) is amended by striking ‘‘Cranston-Gonzalez Na14 tional Affordable Housing Act’’ and inserting ‘‘Housing

15 and Community Development Act of 1993’’.

16 (g) REPORTS.—Section 5128 of the Public and As17 sisted Housing Drug Elimination Act of 1990 (42 U.S.C.

18 11907) is amended—

19 (1) by striking ‘‘The Secretary’’ and inserting

20 the following:

21 ‘‘(a) GRANTEE REPORTS.—The Secretary’’;

22 (2) by striking ‘‘drug-related crime in’’ and in23 serting ‘‘crime in and around’’; and

24 (3) by adding at the end the following new sub25 section:
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1 ‘‘(b) HUD REPORTS.—The Secretary shall submit a

2 report to the Congress describing the system used to distrib3 ute funds to grantees under this section. Such report shall

4 include, at a minimum—

5 ‘‘(1) a description of the criteria used to establish

6 the class of public housing agencies with especially se7 vere crime problems and a list of such agencies;

8 ‘‘(2) the methodology used to distribute funds

9 among the public housing agencies on the list created

10 under paragraph (1); and

11 ‘‘(3) the Secretary’s recommendations for any

12 change to the method of distribution of funds.’’.

13 (h) AUTHORIZATION OF APPROPRIATIONS.—Section

14 5130 of the Public and Assisted Housing Drug Elimination

15 Act of 1990 (42 U.S.C. 11909) is amended—

16 (1) in the first sentence of subsection (a), by

17 striking ‘‘$175,000,000 for fiscal year 1993’’ and all

18 that follows through the end of the sentence and in19 serting ‘‘$265,000,000 for fiscal year 1994 and

20 $325,000,000 for fiscal year 1995.’’; and

21 (2) in subsection (b)—

22 (A) in the heading, by striking ‘‘SET23 ASIDES’’ and inserting ‘‘SET-ASIDE’’; and

24 (B) by striking the second sentence.
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1 (i) REPEAL.—Section 520(k) of the Cranston-Gonzalez

2 National Affordable Housing Act (42 U.S.C. 11908) is here3 by repealed.

4 (j) TECHNICAL ASSISTANCE.—The Public and Assisted

5 Housing Drug Elimination Act of 1990 (42 U.S.C. 11901

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

8 ‘‘SEC. 5131. TECHNICAL ASSISTANCE.

9 ‘‘Of the amounts appropriated annually for each of fis10 cal years 1994 and 1995 to carry out this chapter, the Sec11 retary shall use not more than $10,000,000, directly or in12 directly, under grants, contracts, or cooperative agreements,

13 to provide training, information services, and other tech14 nical assistance to public housing agencies and other enti15 ties with respect to their participation in the program au16 thorized by this chapter. Such technical assistance may in17 clude the establishment and operation of the clearinghouse

18 on drug abuse in public housing and the regional training

19 program on drug abuse in public housing under sections

20 5143 and 5144 of this Act. The Secretary is also authorized

21 to use the foregoing amounts for obtaining assistance in es22 tablishing and managing assessment and evaluation cri23 teria and specifications, and obtaining the opinions of ex24 perts in relevant fields.’’.
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1 TITLE III—TECHNICAL AND

2 OTHER AMENDMENTS

3 Subtitle A—Public and Assisted

4 Housing

5 SEC. 301. CORRECTION TO DEFINITION OF FAMILY.

6 The first sentence of section 3(b)(3)(B) of the United

7 States Housing Act of 1937 (42 U.S.C. 1437a(b)(3)(B)) is

8 amended—

9 (1) by striking ‘‘means’’ and inserting ‘‘in10 cludes’’; and

11 (2) by inserting ‘‘and’’ immediately after ‘‘chil12 dren,’’.

13 SEC. 302. IDENTIFICATION OF CIAP REPLACEMENT NEEDS.

14 Section 14 of the United States Housing Act of 1937

15 (42 U.S.C. 1437l) is amended—

16 (1) in subsection (d)—

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

18 (B) in paragraph (4)—

19 (i) by striking ‘‘and replacements,’’;

20 and

21 (ii) by striking ‘‘(1), (2), and (3)’’ and

22 inserting ‘‘(1) and (3)’’; and

23 (2) in subsection (f)(1)—

24 (A) by striking subparagraph (B); and
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1 (B) in subparagraph (D), by striking ‘‘(1),

2 (2), and (3)’’ and inserting ‘‘(1) and (3)’’.

3 SEC. 303. APPLICABILITY OF PUBLIC HOUSING AMEND4 MENTS TO INDIAN HOUSING.

5 (a) AMENDMENT.—Section 201(b) of the United States

6 Housing Act of 1937 (42 U.S.C. 1437aa(b)) is amended to

7 read as follows:

8 ‘‘(b) APPLICABILITY OF TITLE I.—Except as otherwise

9 provided by law, the provisions of title I shall apply to low10 income housing developed or operated pursuant to a con11 tract between the Secretary and an Indian housing author12 ity.’’.

13 (b) APPLICABILITY OF AMENDMENT.—The amendment

14 made by subsection (a) shall not affect provisions of the

15 United States Housing Act of 1937 that were made applica16 ble to public housing developed or operated pursuant to a

17 contract between the Secretary and an Indian housing au18 thority in accordance with section 201(b)(2) of such Act,

19 as such section existed before the effective date of this sec20 tion.

21 (c) APPLICABILITY OF HOUSING AND COMMUNITY DE22 VELOPMENT ACT OF 1992.—Sections 103(a)(1), 112, 114,

23 116, 118, 903, and 927 of the Housing and Community

24 Development Act of 1992 shall apply to public housing de-
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1 veloped or operated pursuant to a contract between the Sec2 retary and an Indian housing authority.

3 SEC. 304. PROJECT-BASED ACCOUNTING.

4 Section 6(c)(4)(E) of the United States Housing Act

5 of 1937 (42 U.S.C. 1437d(c)(4)(E)) is amended by striking

6 ‘‘250’’ and inserting ‘‘500’’.

7 SEC. 305. OPERATING SUBSIDY ADJUSTMENTS FOR ANTICI8 PATED FRAUD RECOVERIES.

9 Section 9(a) of the United States Housing Act of 1937

10 (42 U.S.C. 1437g(a)) is amended by adding at the end the

11 following new paragraph:

12 ‘‘(4) Adjustments to a public housing agency’s operat13 ing subsidy made by the Secretary under this section shall

14 reflect actual changes in rental income collections resulting

15 from the application of section 904 of the Stewart B.

16 McKinney Homeless Assistance Amendments Act of 1988.’’.

17 SEC. 306. TECHNICAL ASSISTANCE FOR LEAD HAZARD RE18 DUCTION GRANTEES.

19 Section 1011(g) of the Housing and Community Devel20 opment Act of 1992 (42 U.S.C. 5318 note) is hereby re21 pealed.
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1 SEC. 307. ENVIRONMENTAL REVIEW IN CONNECTION WITH

2 GRANTS FOR LEAD-BASED PAINT HAZARD RE3 DUCTION.

4 Section 1011 of the Housing and Community Develop5 ment Act of 1992 (42 U.S.C. 5318 note) is amended—

6 (1) by redesignating subsection (o) as subsection

7 (p); and

8 (2) by adding after subsection (n) the following

9 new subsection:

10 ‘‘(o) ENVIRONMENTAL REVIEW.—

11 ‘‘(1) IN GENERAL.—For purposes of environ12 mental review, decisionmaking, and action pursuant

13 to the National Environmental Policy Act of 1960

14 and other provisions of law that further the purposes

15 of such Act, a grant under this section shall be treated

16 as assistance under the HOME Investment Partner17 ship Act, established under title II of the Cranston18 Gonzalez National Affordable Housing Act, and shall

19 be subject to the regulations promulgated by the Sec20 retary to implement section 288 of such Act.

21 ‘‘(2) APPLICABILITY.—This subsection shall

22 apply to—

23 ‘‘(A) grants awarded under this section; and

24 ‘‘(B) grants awarded to States and units of

25 general local government for the abatement of

26 significant lead-based paint and lead dust haz-
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1 ards in low- and moderate-income owner-occu2 pied units and low-income privately owned rent3 al units pursuant to title II of the Departments

4 of Veterans Affairs and Housing and Urban De5 velopment, and Independent Agencies Appro6 priations Act, 1992 (Public Law 102–139, 105

7 Stat. 736).’’.

8 SEC. 308. FIRE SAFETY IN FEDERALLY ASSISTED HOUSING.

9 Section 31(c)(2)(A)(i) of the Federal Fire Prevention

10 and Control Act of 1974 (15 U.S.C. 2227(c)(2)(A)(i)) is

11 amended by adding ‘‘(or equivalent level of safety)’’ after

12 ‘‘system’’.

13 SEC. 309. SECTION 23 CONVERSION PROJECTS.

14 (a) SECTION 23 CONVERSION.—

15 (1) AUTHORIZATION.—Notwithstanding con16 tracts entered into pursuant to section 14(b)(2) of the

17 United States Housing Act of 1937, the Secretary is

18 authorized to enter into obligations for conversion of

19 Leonard Terrace Apartments in Grand Rapids,

20 Michigan, from a leased housing contract under sec21 tion 23 of such Act to a project-based rental assist22 ance contract under section 8 of such Act.

23 (2) REPAYMENT REQUIRED.—The authorization

24 made in paragraph (1) is conditioned on the repay25 ment to the Secretary of all amounts received by the
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1 public housing agency under the comprehensive im2 provement assistance program under section 14 of the

3 United States Housing Act of 1937 for the Leonard

4 Terrace Apartment project and the amounts, as deter5 mined by the Secretary, received by the public hous6 ing agency under the formula in section 14(k) of such

7 Act by reason of the project.

8 (b) CONTRACT RENEWAL.—

9 (1) IN GENERAL.—Leased housing contracts

10 under section 23 of the United States Housing Act of

11 1937, as such section existed before the date of enact12 ment of the Housing and Community Development

13 Act of 1974, that—

14 (A) were converted to section 8 contracts on

15 terms similar to or the same as the terms of the

16 section 8 new construction program; and

17 (B) expire during fiscal year 1994 or 1995;

18 shall be extended for a period not to exceed 5 years

19 as if the rents on such projects were established under

20 the section 8 new construction program, except that

21 section 8(c)(2)(C) of the United States Housing Act of

22 1937 shall not apply to such contracts.

23 (2) BUDGET COMPLIANCE.—To the extent that

24 paragraph (1) results in additional costs under this

25 section, such paragraph shall be effective only to the
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1 extent that amounts to cover such additional costs are

2 provided in advance in appropriation Acts.

3 SEC. 310. INDEMNIFICATION OF CONTRACTORS FOR INTEL4 LECTUAL PROPERTY RIGHTS DISPUTES.

5 A recipient of Federal housing assistance may not use

6 such funds to indemnify contractors or subcontractors

7 against costs associated with litigating or settling disputes

8 concerning the infringement of intellectual property rights.

9 Subtitle B—Multifamily Housing

10 SEC. 321. CORRECTION OF MULTIFAMILY MORTGAGE LIM11 ITS.

12 The National Housing Act (12 U.S.C. 1701 et seq.) is

13 amended in sections 207(c)(3), 213(b)(2), 220(d)(3)(B)(iii),

14 and 234(e)(3) by striking ‘‘$59,160’’ each place it appears

15 and inserting ‘‘$56,160’’.

16 SEC. 322. FHA MULTIFAMILY RISK-SHARING; HFA PILOT

17 PROGRAM AMENDMENTS.

18 (a) IN GENERAL.—Section 542(c) of the Housing and

19 Community Development Act of 1992 (12 U.S.C. 1707 note)

20 is amended—

21 (1) in paragraph (1), by inserting after ‘‘quali22 fied housing finance agencies’’ the following: ‘‘(includ23 ing entities established by States that provide mort24 gage insurance)’’;

25 (2) in paragraph (2)—
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1 (A) in subparagraph (C), by striking the

2 last sentence and inserting the following: ‘‘Such

3 agreements shall specify that the qualified hous4 ing finance agency and the Secretary shall share

5 any loss in accordance with the risk-sharing

6 agreement.’’; and

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

8 subparagraph:

9 ‘‘(F) DISCLOSURE OF RECORDS.—Qualified

10 housing finance agencies shall make available to

11 the Secretary such financial and other records as

12 the Secretary deems necessary for program re13 view and monitoring purposes.’’;

14 (3) in paragraph (7)—

15 (A) by striking ‘‘very low-income’’; and

16 (B) by striking ‘‘(2)’’; and

17 (4) by adding at the end the following new para18 graphs:

19 ‘‘(9) ENVIRONMENTAL AND OTHER REVIEWS.—

20 ‘‘(A) ENVIRONMENTAL REVIEWS.—

21 ‘‘(i) IN GENERAL.—(I) In order to as22 sure that the policies of the National Envi23 ronmental Policy Act of 1969 and other

24 provisions of law which further the purposes

25 of such Act (as specified in regulations is-
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1 sued by the Secretary) are most effectively

2 implemented in connection with the insur3 ance of mortgages under subsection (c)(2),

4 and to assure to the public undiminished

5 protection of the environment, the Secretary

6 may, under such regulations, in lieu of the

7 environmental protection procedures other8 wise applicable, provide for agreements to

9 endorse for insurance mortgages under sub10 section (c)(2) upon the request of qualified

11 housing finance agencies under this sub12 section, if the State or unit of general local

13 government, as designated by the Secretary

14 in accordance with regulations, assumes all

15 of the responsibilities for environmental re16 view, decisionmaking, and action pursuant

17 to such Act, and such other provisions of

18 law as the regulations of the Secretary may

19 specify, that would otherwise apply to the

20 Secretary with respect to the insurance of

21 mortgages on particular properties.

22 ‘‘(II) The Secretary shall issue regula23 tions to carry out this subparagraph only

24 after consultation with the Council on En-
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1 vironmental Quality. Such regulations

2 shall, among other matters, provide—

3 ‘‘(aa) for the monitoring of the

4 performance of environmental reviews

5 under this subparagraph;

6 ‘‘(bb) subject to the discretion of

7 the Secretary, for the provision or fa8 cilitation of training for such perform9 ance; and

10 ‘‘(cc) subject to the discretion of

11 the Secretary, for the suspension or ter12 mination by the Secretary of the quali13 fied housing finance agency’s respon14 sibilities under subclause (I).

15 ‘‘(III) The Secretary’s duty under

16 subclause (II) shall not be construed to limit

17 any responsibility assumed by a State or

18 unit of general local government with re19 spect to any particular property under

20 subclause (I).

21 ‘‘(ii) PROCEDURE.—The Secretary

22 shall approve a mortgage for the provision

23 of mortgage insurance subject to the proce24 dures authorized by this paragraph only if,

25 not less than 15 days prior to such ap-
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1 proval, prior to any approval, commitment,

2 or endorsement of mortgage insurance on

3 the property on behalf of the Secretary, and

4 prior to any commitment by the qualified

5 housing finance agency to provide financing

6 under the risk-sharing agreement with re7 spect to the property, the qualified housing

8 finance agency submits to the Secretary a

9 request for such approval, accompanied by

10 a certification of the State or unit of gen11 eral local government that meets the re12 quirements of clause (iii). The Secretary’s

13 approval of any such certification shall be

14 deemed to satisfy the Secretary’s respon15 sibilities under the National Environmental

16 Policy Act of 1969 and such other provi17 sions of law as the regulations of the Sec18 retary specify insofar as those responsibil19 ities relate to the provision of mortgage in20 surance on the property that is covered by

21 such certification.

22 ‘‘(iii) CERTIFICATION.—A certification

23 under the procedures authorized by this

24 paragraph shall—
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1 ‘‘(I) be in a form acceptable to the

2 Secretary;

3 ‘‘(II) be executed by the chief exec4 utive officer or other officer of the State

5 or unit of general local government

6 who qualifies under regulations of the

7 Secretary;

8 ‘‘(III) specify that the State or

9 unit of general local government under

10 this section has fully carried out its re11 sponsibilities as described under clause

12 (i); and

13 ‘‘(IV) specify that the certifying

14 officer consents to assume the status of

15 a responsible Federal official under the

16 National Environmental Policy Act of

17 1969 and under each provision of law

18 specified in regulations issued by the

19 Secretary insofar as the provisions of

20 such Act or such other provisions of

21 law apply pursuant to clause (i), and

22 is authorized and consents on behalf of

23 the State or unit of general local gov24 ernment and himself or herself to ac25 cept the jurisdiction of the Federal
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1 courts for the purpose of enforcement of

2 the responsibilities as such an official.

3 ‘‘(iv) APPROVAL BY STATES.—In cases

4 in which a unit of general local government

5 carries out the responsibilities described in

6 clause (i), the Secretary may permit the

7 State to perform those actions of the Sec8 retary described in clause (ii) and the per9 formance of such actions by the State, where

10 permitted by the Secretary, shall be deemed

11 to satisfy the Secretary’s responsibilities re12 ferred to in the second sentence of clause

13 (ii).

14 ‘‘(B) LEAD-BASED PAINT POISONING PRE15 VENTION.—In carrying out the requirements of

16 section 302 of the Lead-Based Paint Poisoning

17 Prevention Act, the Secretary may provide by

18 regulation for the assumption of all or part of

19 the Secretary’s duties under such Act by quali20 fied housing finance agencies, for purposes of

21 this section.

22 ‘‘(C) CERTIFICATION OF SUBSIDY LAYERING

23 COMPLIANCE.—The requirements of section

24 102(d) of the Department of Housing and Urban

25 Development Reform Act of 1989 may be satis-
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1 fied in connection with a commitment to insure

2 a mortgage under this subsection by a certifi3 cation by a housing credit agency (including an

4 entity established by a State that provides mort5 gage insurance) to the Secretary that the com6 bination of assistance within the jurisdiction of

7 the Secretary and other government assistance

8 provided in connection with a property for

9 which a mortgage is to be insured shall not be

10 any greater than is necessary to provide afford11 able housing.

12 ‘‘(10) DEFINITIONS.—For purposes of this sub13 section, the following definitions shall apply:

14 ‘‘(A) MORTGAGE.—The term ‘mortgage’

15 means a first mortgage on real estate that is—

16 ‘‘(i) owned in fee simple; or

17 ‘‘(ii) subject to a leasehold interest

18 that—

19 ‘‘(I) has a term of not less than 99

20 years and is renewable; or

21 ‘‘(II) has a remaining term that

22 extends beyond the maturity of the

23 mortgage for a period of not less than

24 10 years.
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1 ‘‘(B) FIRST MORTGAGE.—The term ‘first

2 mortgage’ means a single first lien given to se3 cure advances on, or the unpaid purchase price

4 of, real estate, under the laws of the State in

5 which the real estate is located, together with the

6 credit instrument, if any, secured thereby. Any

7 other financing permitted on property insured

8 under this section must be expressly subordinate

9 to the insured mortgage.

10 ‘‘(C) UNIT OF GENERAL LOCAL GOVERN11 MENT; STATE.—The terms ‘unit of general local

12 government’ and ‘State’ have the same meanings

13 as in section 102(a) of the Housing and Commu14 nity Development Act of 1974.’’.

15 (b) DEFINITION OF MULTIFAMILY HOUSING.—Section

16 544(1) of the Housing and Community Development Act

17 of 1992 (12 U.S.C. 1707 note) is amended to read as follows:

18 ‘‘(1) The term ‘multifamily housing’ means hous19 ing accommodations on the mortgaged property that

20 are designed principally for residential use, conform

21 to standards satisfactory to the Secretary, and consist

22 of not less than 5 rental units on 1 site. These units

23 may be detached, semidetached, row house, or multi24 family structures.’’.
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1 SEC. 323. SUBSIDY LAYERING REVIEW.

2 Section 911 of the Housing and Community Develop3 ment Act of 1992 (42 U.S.C. 3545 note) is amended—

4 (1) by striking subsection (a) and inserting the

5 following:

6 ‘‘(a) CERTIFICATION OF SUBSIDY LAYERING COMPLI7 ANCE.—The requirements of section 102(d) of the Depart8 ment of Housing and Urban Development Reform Act of

9 1989 may be satisfied in connection with a project receiving

10 assistance under a program that is within the jurisdiction

11 of the Department of Housing and Urban Development and

12 under section 42 of the Internal Revenue Code of 1986 by

13 a certification by a housing credit agency to the Secretary,

14 submitted in accordance with guidelines established by the

15 Secretary, that the combination of assistance within the ju16 risdiction of the Secretary and other government assistance

17 provided in connection with a property for which assistance

18 is to be provided within the jurisdiction of the Department

19 of Housing and Urban Development and under section 42

20 of the Internal Revenue Code of 1986 shall not be any great21 er than is necessary to provide affordable housing.’’; and

22 (2) by striking subsection (c) and inserting the

23 following:

24 ‘‘(c) REVOCATION BY SECRETARY.—If the Secretary

25 determines that a housing credit agency has failed to com-
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1 ply with the guidelines established under subsection (a), the

2 Secretary—

3 ‘‘(1) may inform the housing credit agency that

4 the agency may no longer submit certification of sub5 sidy layering compliance under this section; and

6 ‘‘(2) shall carry out section 102(d) of the Hous7 ing and Urban Development Reform Act relating to

8 affected projects allocated a low-income housing tax

9 credit pursuant to section 42 of the Internal Revenue

10 Code of 1986.’’.

11 Subtitle C—Rural Housing

12 SEC. 331. TECHNICAL CORRECTION TO RURAL HOUSING

13 PRESERVATION PROGRAM.

14 Section 515(c)(1) of the Housing Act of 1949 (42

15 U.S.C. 1485(c)(1)) is amended by striking ‘‘December 21,

16 1979’’ and inserting ‘‘December 15, 1989’’.

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