I 

109TH CONGRESS 

2D SESSION H. R. 5039 

To establish a program to revitalize rural multifamily housing assisted under 

the Housing Act of 1949. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 29, 2006 

Mr. DAVIS of Kentucky (for himself, Mr. FRANK of Massachusetts, Mr. NEY, 

Mr. DAVIS of Alabama, Mr. GARY G. MILLER of California, Mr. 

HINOJOSA, and Mr. RENZI) introduced the following bill; which was referred to the Committee on Financial Services 

A BILL 

To establish a program to revitalize rural multifamily 

housing assisted under the Housing Act of 1949. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Saving America’s 

5 Rural Housing Act of 2006’’. 

6 SEC. 2. FINDINGS AND PURPOSES. 

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

8 (1) section 502(c) of the Housing Act of 1949 

9 restricts the rights of certain owners of projects for 


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1 which loans were made or insured under section 515 

2 of such Act to prepay such loans; 

3 (2) expensive litigation against the Department 

4 of Agriculture has cost the taxpayers of the United 

5 States millions of dollars to date, funds that would 

6 be better spent preserving affordable multifamily 

7 housing; 

8 (3) if such section 502(c) is partially repealed 

9 and the prepayment restrictions are eliminated for 

10 multifamily housing loans made before 1989 under 

11 section 515, it is expected, according to a report, 

12 that approximately 10 percent of the portfolio of 

13 such loans would be prepaid and those projects 

14 would leave the program; 

15 (4) the average age of a multifamily housing 

16 project with a section 515 loan is 28 years, and 

17 therefore much of the portfolio of such projects is 

18 aging and in need of revitalization, while the need 

19 for affordable rural housing is increasing; 

20 (5) section 515 projects house some of the 

21 poorest families in rural America, with almost 60 

22 percent of the units occupied by senior citizens or 

23 persons with disabilities and an average annual 

24 household income among all occupants of approxi25 mately $9,000; 


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1 (6) in many small towns and communities, rent2 al housing financed by direct loans under section 

3 515 is the only decent, affordable rental housing 

4 available.; and 

5 (7) consequently, any revitalization or disposi6 tion of this portfolio, which houses nearly 500,000 

7 low-income families and seniors, should be handled 

8 with great care. 

9 (b) PURPOSES.—The purposes of this Act are— 

10 (1) to authorize the Secretary of Agriculture to 

11 carry out a program that encourages, to the extent 

12 practicable, the retention of section 515 housing 

13 projects developments for long-term use and the re14 pair and preservation of such properties, and en15 sures that the minimum number of residents are dis16 placed; 

17 (2) to repeal a portion of section 502(c) of the 

18 Housing Act of 1949 to avoid further costly litiga19 tion against the Department of Agriculture; 

20 (3) to preserve the availability of affordable 

21 rural housing by providing a voluntary mechanism 

22 for owners of multifamily rural housing projects with 

23 loans under section 515 to enter into loan restruc24 turing agreements with the Secretary to provide cap25 ital for revitalization activities; and 


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1 (4) to provide for affordable rents for tenants 

2 who live in such projects that are revitalized under 

3 this Act and to protect tenants who live in such 

4 projects for which the loan is prepaid. 

5 SEC. 3. REVITALIZATION OF MULTIFAMILY HOUSING. 

6 (a) REVITALIZATION PROGRAM.—Title V of the 

7 Housing Act of 1949 (42 U.S.C. 1471 et seq.) is amended 

8 by adding at the end the following new section: 

9 ‘‘SEC. 544. REVITALIZATION AND TENANT PROTECTION 

10 VOUCHERS. 

11 ‘‘(a) PURPOSE.—The purposes of this section are— 

12 ‘‘(1) to protect tenants who live in multifamily 

13 housing projects that are subsidized under this title 

14 and, in the case of prepayments of loans under sec15 tion 515, to protect tenants that are displaced when 

16 the projects cease being eligible projects; 

17 ‘‘(2) to strengthen the long-term viability of eli18 gible projects; 

19 ‘‘(3) to promote the revitalization of rural mul20 tifamily housing projects; and 

21 ‘‘(4) to accomplish such several purposes— 

22 ‘‘(A) by providing a voluntary mechanism 

23 for project owners to enter into loan restruc24 turing agreements with the Secretary to obtain 


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1 new types of financial assistance to rehabilitate 

2 and maintain the projects; and 

3 ‘‘(B) by deregulating certain projects in a 

4 manner that still provides measurable perform5 ance standards and effective financing and re6 habilitation of multifamily housing. 

7 ‘‘(b) REVITALIZATION.— 

8 ‘‘(1) IN GENERAL.—The Secretary shall, sub9 ject to the availability of amounts appropriated, 

10 carry out a revitalization program in accordance 

11 with this subsection to provide financial incentives 

12 and other assistance to owners of eligible projects 

13 through voluntary long-term use agreements entered 

14 into between the project owners and the Secretary. 

15 ‘‘(2) APPLICATIONS TO PARTICIPATE.—The 

16 Secretary may accept applications from owners of el17 igible projects to participate in the revitalization pro18 gram under this section. 

19 ‘‘(3) LONG-TERM VIABILITY PLAN.— 

20 ‘‘(A) REQUIREMENT.—The Secretary may 

21 prepare and approve a long-term viability plan 

22 under this paragraph with respect to each eligi23 ble project for which the owner requests to par24 ticipate. 


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1 ‘‘(B) CONTENTS.—Each long-term viability 

2 plan for an eligible project shall include the fol3 lowing information: 

4 ‘‘(i) COMPREHENSIVE NEEDS ASSESS5 MENT.—A comprehensive needs assess6 ment of the project that identifies and 

7 projects, for the following 20 years— 

8 ‘‘(I) all necessary repairs, im9 provements, maintenance, and man10 agement standards for the project, 

11 and when they will be made, in order 

12 to meet the requirements of this title; 

13 and 

14 ‘‘(II) the costs associated with 

15 the items referred to in this subpara16 graph (A). 

17 ‘‘(ii) FINANCIAL PLAN.—A financial 

18 plan for the project that— 

19 ‘‘(I) reviews the financial stability 

20 of the project; 

21 ‘‘(II) includes the loan restruc22 turing elements, rent adjustments, 

23 management and operational effi24 ciencies, and other financial adjust25 ments to the project that are necVerDate Aug 31 2005 22:40 Mar 30, 2006 Jkt 049200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H5039.IH H5039

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1 essary to cover operating expenses for 

2 the project and maintain an adequate 

3 financial reserve for the future main4 tenance and capital needs of the 

5 project; 

6 ‘‘(III) provides the project owner 

7 with a long-term rate of return on 

8 new capital, including any portion of 

9 low-income housing tax credit pro10 ceeds used for hard construction 

11 costs, as determined by the Secretary, 

12 commensurate to comparable commer13 cial multifamily housing projects; 

14 ‘‘(IV) meets the comprehensive 

15 needs for the project determined 

16 under the comprehensive needs assess17 ment; and 

18 ‘‘(V) ensures that rents available 

19 under the plan are affordable to eligi20 ble households in accordance with 

21 paragraph (7). 

22 ‘‘(C) DEVELOPMENT THROUGH PARTICI23 PATING ADMINISTRATIVE ENTITIES.—The Sec24 retary may develop long-term viability plans 

25 through the use of third-party participating adVerDate Aug 31 2005 22:40 Mar 30, 2006 Jkt 049200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H5039.IH H5039

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1 ministrative entities, who may be a private con2 tractor, a State housing finance agency, or a 

3 nonprofit organization. 

4 ‘‘(D) REVITALIZATION DETERMINATION.— 

5 Based on the long-term viability plan for an eli6 gible project, the Secretary shall determine 

7 whether to offer the project owner a financial 

8 restructuring plan under paragraph (4) and the 

9 financial incentives to be included in any such 

10 plan offered. 

11 ‘‘(E) FINAL REVIEW AND COMMENT.— 

12 With respect to any long-term viability plan 

13 prepared by the Secretary, the Secretary shall 

14 provide the project owner an opportunity to re15 view the plan and discuss the plan with the Sec16 retary or its agent before a determination is 

17 made under subparagraph (D). 

18 ‘‘(F) FEES.—The Secretary may charge 

19 the project owner a fee for preparation of the 

20 long-term viability plan. 

21 ‘‘(G) PAYMENT OF FEES.—If a long-term 

22 viability for a project is approved, the payment 

23 of such fee may be incorporated into a project 

24 owner’s financial restructuring plan for the 


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1 project provided by the Secretary pursuant to 

2 paragraph (4) 

3 ‘‘(4) FINANCIAL RESTRUCTURING PLAN; REVI4 TALIZATION INCENTIVES.—Based on the long-term 

5 viability plan for an eligible project, the Secretary 

6 may offer a project owner a financial restructuring 

7 plan for the project. Such a plan may include one 

8 or more of the following revitalization incentives: 

9 ‘‘(A) Reduction or elimination of interest 

10 on the loan for the project made under section 

11 515. 

12 ‘‘(B) Partial or full deferral of payments 

13 due under such loan. 

14 ‘‘(C) Forgiveness of such loan. 

15 ‘‘(D) Subordination of such loan, subject 

16 to such terms and conditions as the Secretary 

17 shall determine. 

18 ‘‘(E) Reamortization of loan payments 

19 under such loan over extended terms. 

20 ‘‘(F) A grant from the Secretary for the 

21 project. 

22 ‘‘(G) Payment of project costs associated 

23 with developing the long-term viability plan. 


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1 ‘‘(H) Opportunity for project owners to ob2 tain further investment equity from third par3 ties in the project. 

4 ‘‘(I) A direct loan or guarantee of a loan 

5 for the project, with a subsidized interest rate 

6 without regard to the value of the project. 

7 ‘‘(5) LONG-TERM USE AGREEMENT.— 

8 ‘‘(A) IN GENERAL.—If the owner of an eli9 gible project agrees to the terms of a financial 

10 restructuring plan for the project providing re11 vitalization benefits under paragraph (4), in ex12 change for such benefits, the Secretary and the 

13 project owner shall enter into a long-term use 

14 agreement under this paragraph for the project. 

15 ‘‘(B) AGREEMENT.—A long-term use 

16 agreement for an eligible project shall include— 

17 ‘‘(i) the terms of the financial restruc18 turing plan for the project, including any 

19 revitalization incentives to be provided; 

20 ‘‘(ii) an agreement by the project 

21 owner— 

22 ‘‘(I) to continue the property use 

23 restrictions with respect to the project 

24 in accordance with this title for a pe25 riod of (aa) 20 years, or (bb) the reVerDate Aug 31 2005 22:40 Mar 30, 2006 Jkt 049200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H5039.IH H5039

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1 maining term of any loans under this 

2 title for the project, whichever ends 

3 later; 

4 ‘‘(II) to comply with the long5 term viability plan for the project; 

6 ‘‘(III) to comply with the rent 

7 terms under paragraph (7) for the 

8 project; and 

9 ‘‘(IV) to make value payments 

10 under paragraph (6) to the Secretary, 

11 and the terms of such payments; 

12 ‘‘(iii) provisions terminating the 

13 agreement if any revitalization incentives 

14 for the project to be provided under the 

15 agreement are no longer available and the 

16 Secretary determines that such unavail17 ability is not the fault of the owner; 

18 ‘‘(iv) any rent terms for the project 

19 pursuant to paragraph (7); 

20 ‘‘(v) a covenant which runs with the 

21 land; and 

22 ‘‘(vi) such other terms as the Sec23 retary determines are necessary to imple24 ment the purposes of this section. 


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1 ‘‘(6) SHARED VALUE AGREEMENTS.—Each 

2 long-term use agreement shall include a shared value 

3 agreement secured by the property of the eligible 

4 project that is the subject of the long-term use 

5 agreement, which shall determine how proceeds are 

6 divided at the end of the term of the loan and shall 

7 require the project owner, at the end of such loan 

8 term, to pay the lesser of— 

9 ‘‘(A) the sum of— 

10 ‘‘(i) the amounts of any loan 

11 writedowns, write-offs, and interest sub12 sidies provided in connection with the loan 

13 restructuring under this subsection, at the 

14 closing of revitalization; 

15 ‘‘(ii) any outstanding principal and in16 terest; and 

17 ‘‘(iii) any non-loan funds provided by 

18 the Secretary under this subsection; or 

19 ‘‘(B) 75 percent of the appraised value of 

20 the eligible project. 

21 ‘‘(7) RENTS UNDER LONG-TERM USE AGREE22 MENT.—In any eligible project that is subject to a 

23 long-term use agreement, rents for eligible house24 holds shall comply with the following requirements: 


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1 ‘‘(A) MINIMUM RENT.—The Secretary, act2 ing through the director of the applicable local 

3 agency or office of the Department responsible 

4 for carrying out the programs under this title 

5 in such area, may provide that each eligible 

6 household is charged a minimum monthly rent 

7 in an amount determined by such local director 

8 that does not in any case exceed $25. The Sec9 retary may allow exceptions to such minimum 

10 rent for an eligible household or groups of eligi11 ble households for demonstrated hardship, as 

12 determined by the Secretary, which hardship 

13 exceptions, if allowed by the Secretary, shall in14 clude the hardship exceptions provided or estab15 lished by the Secretary of Housing and Urban 

16 Development, as appropriate, under subclauses 

17 (I) through (V) of section 3(a)(3)(B)(i) of the 

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

19 1437a(a)(3)(B)(i)). 

20 ‘‘(B) MAXIMUM RENT.—Notwithstanding 

21 any minimum monthly rent established pursu22 ant to subparagraph (A), the amount of month23 ly rent charged to any eligible household may 

24 not exceed 30 percent of the adjusted income of 

25 the eligible household. Such local director may 


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1 take such actions as may be necessary to verify 

2 tenant incomes for purposes of carrying out this 

3 subparagraph. 

4 ‘‘(C) RENT ADJUSTMENTS.—The rents for 

5 eligible households may be increased or de6 creased only on an annual basis and only in ac7 cordance with standards incorporated in such 

8 agreement. The Secretary shall issue regula9 tions establishing such standards, which shall 

10 include standards for rents that are considered 

11 affordable for eligible households for the area in 

12 which a project is located and for establishing 

13 rents that conform to such standards. 

14 ‘‘(8) LOWEST COST REQUIREMENT.—In deter15 mining the terms of a restructuring plan, and the 

16 type and amount of revitalization benefits under 

17 such plan to approve under this subsection for an el18 igible project, the Secretary shall, to the extent prac19 ticable, approve assistance that imposes the least 

20 cost to the Secretary while meeting the requirements 

21 of the long-term viability plan for the project. 

22 ‘‘(c) HOMEOWNERSHIP OPPORTUNITIES.—The owner 

23 of an eligible project may, in conjunction with revitaliza24 tion of the project pursuant to this section, propose a sale 

25 to a tenant-based condominium or cooperative. Any such 


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1 proposal shall be subject to a notice to tenants under 

2 terms that the Secretary shall establish. 

3 ‘‘(d) DETERMINATION OF INELIGIBILITY.— 

4 ‘‘(1) PROCEDURE.—The Secretary may deter5 mine that a project owner is ineligible for participa6 tion in the revitalization program under this section 

7 in accordance with the standards under paragraph 

8 (2). 

9 ‘‘(2) STANDARDS.— The Secretary may deter10 mine that a project owner is ineligible if— 

11 ‘‘(A) the project owner has a history of 

12 poor management or maintenance of multi13 family housing properties; 

14 ‘‘(B) the project owner is in default on a 

15 loan made available under the section 514 or 

16 515 housing program; 

17 ‘‘(C) the Secretary is unable to enter into 

18 a long-term use agreement for the project that 

19 is the subject of the application with the project 

20 owner within a reasonable time; 

21 ‘‘(D) the project owner is suspended or 

22 debarred from participating in Federal con23 tracts or programs; or 


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1 ‘‘(E) the Secretary has other good cause 

2 for withholding from the project owner the ben3 efits made available under this section. 

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

5 following definitions shall apply: 

6 ‘‘(1) ELIGIBLE HOUSEHOLD.—The term ‘eligi7 ble household’ means a household that, under sec8 tion 515, is eligible to reside in a project funded 

9 with a loan made by the Secretary under such sec10 tion. 

11 ‘‘(2) ELIGIBLE PROJECT.—The term ‘eligible 

12 project’ means a housing project funded with a loan 

13 made at any time by the Secretary under section 

14 515, the principal obligation of which has not been 

15 fully repaid. 

16 ‘‘(3) PROJECT OWNER; OWNER.—The terms 

17 ‘project owner’ and ‘owner’ mean, with respect to an 

18 eligible project, an individual or entity, or principals 

19 thereof that own, or plan to purchase, the project.’’. 

20 (b) PRIORITY FOR SECTION 515 FINANCING.—Sub21 section (j) of section 515 of the Housing Act of 1949 (42 

22 U.S.C. 1485(j)) is amended— 

23 (1) by inserting ‘‘(1)’’ before ‘‘For’’; and 

24 (2) by adding at the end the following new 

25 paragraph: 


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1 ‘‘(2) The Secretary may give priority, in enter2 ing into contracts under this section involving fi3 nancing for new construction of a project, for 

4 projects located in areas having a need for afford5 able low-income rental housing due to prepayment of 

6 loans made or insured under this section.’’. 

7 (c) PARTIAL REPEAL OF PREPAYMENT RESTRIC8 TIONS; ADMINISTRATION OF PREPAYMENT REQUESTS.— 

9 Section 502 of the Housing Act of 1949 (42 U.S.C. 1472) 

10 is amended— 

11 (1) in subsection (c)— 

12 (A) by striking ‘‘or 515’’ each place such 

13 term appears; and 

14 (B) in paragraph (5)(G)(i)(I), by striking 

15 ‘‘, as the case may be,’’; and 

16 (2) by adding at the end the following new sub17 section: 

18 ‘‘(i) PREPAYMENT OF SECTION 515 MULTIFAMILY

19 HOUSING LOANS.— 

20 ‘‘(1) ADMINISTRATION.— 

21 ‘‘(A) PLAN.—The Secretary shall develop a 

22 plan to administer requests to prepay (not 

23 made in connection with any revitalization 

24 under section 544) any loan made under section 

25 515. The plan shall provide for administration 


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1 of voucher assistance in accordance with para2 graph (3). The plan shall encourage and facili3 tate owners of projects to maintain the projects, 

4 or to transfer projects to owners who will main5 tain projects, as housing affordable to low-in6 come residents. 

7 ‘‘(B) IMPLEMENTATION.—The Secretary 

8 shall implement this subsection not later than 

9 the expiration of the 90-day period beginning 

10 on the date of the enactment of the Saving 

11 America’s Rural Housing Act of 2006. Notwith12 standing that full implementation of this sub13 section may not have been completed, the Sec14 retary may not delay the processing of any re15 quest to prepay a loan made under section 515. 

16 ‘‘(2) NOTICE OF PREPAYMENT AND SALE.—As 

17 a condition of prepayment of a loan made or insured 

18 under section 515, the project owner shall, not less 

19 than 90 days before taking any action to prepay the 

20 loan or sell the project for which the loan was made, 

21 provide the following notices: 

22 ‘‘(A) NOTICE TO TENANTS.—To the ten23 ants of the project, notice of the prepayment, as 

24 follows: 


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1 ‘‘(i) The notice shall include informa2 tion sufficient to inform tenants of the 

3 availability of vouchers pursuant to para4 graph (3), actions tenants must take to re5 ceive voucher assistance, the date prepay6 ment is expected to take place, a telephone 

7 number and electronic mail address at 

8 which to contact the owner of the project, 

9 and any limitations, use, and other terms 

10 the Secretary considers appropriate. 

11 ‘‘(ii) In the case of any prepayment 

12 involving transfer of the ownership of a 

13 project, the notice shall include the name 

14 of the transferee, the date that the trans15 fer was agreed to, the date the transfer is 

16 to take place, and telephone numbers and 

17 electronic mail addresses at which to con18 tact the transferor and transferee. 

19 ‘‘(B) NOTICE TO SECRETARY.—To the 

20 Secretary, notice that the requirements under 

21 subparagraph (A) have been met, which shall 

22 identify the date that notice under such sub23 paragraph was made and the names or each 

24 tenant to which such notice was provided. 


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1 ‘‘(3) RURAL TENANT PROTECTION VOUCH2 ERS.— 

3 ‘‘(A) IN GENERAL.—If the owner of a 

4 housing project subject to a loan made under 

5 section 515 prepays the loan, the Secretary 

6 shall, to the extent that amounts for assistance 

7 under this paragraph are provided in advance 

8 in appropriation Acts, make voucher assistance 

9 available to each low-income family who on the 

10 date of prepayment is residing in a dwelling 

11 unit in the project. 

12 ‘‘(B) USE.—A voucher under this para13 graph for a family may be used for rental of a 

14 dwelling unit in the project that the family re15 sides in on the date of the prepayment referred 

16 to in subparagraph (A) or for a dwelling unit 

17 elsewhere. 

18 ‘‘(C) RIGHT TO USE.—In the case of a 

19 project for which a loan made under section 

20 515 is prepaid, the owner of the project may 

21 not refuse to lease, to a family for whom vouch22 er assistance under this paragraph is made 

23 available, any available rental dwelling unit in 

24 the project a proximate cause of which is the 


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1 status of such family as a recipient of such as2 sistance. 

3 ‘‘(D) AMOUNT OF ASSISTANCE.—The 

4 amount of rental assistance provided under a 

5 voucher under this paragraph on behalf of a 

6 tenant shall be the amount by which— 

7 ‘‘(i) the lesser of (I) the rent for the 

8 dwelling unit rented using such voucher, or 

9 (II) the rent for a comparable unit in the 

10 same market area as the housing project 

11 for which the loan was prepaid; exceeds 

12 ‘‘(ii) the lesser of (I) the amount of 

13 rent paid by the tenant for the dwelling 

14 unit occupied by the tenant at the time of 

15 the prepayment referred to in paragraph 

16 (1), or (II) the amount equal to 30 percent 

17 of the tenant’s adjusted income (as such 

18 term is defined in section 3(b) of the 

19 United States Housing Act of 1937 (42 

20 U.S.C. 1437a(b)). 

21 ‘‘(E) RURAL AFFORDABLE VOUCHER.—For 

22 communities with insufficient affordable hous23 ing alternatives, as determined by the Sec24 retary, voucher assistance under this paragraph 

25 may be provided in accordance with section 


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1 8(t)(1) of the United States Housing Act of 

2 1937 (42 U.S.C. 1437f(t)(1)). 

3 ‘‘(F) ADMINISTRATION.—To the maximum 

4 extent practicable, the Secretary shall admin5 ister voucher assistance under this paragraph in 

6 accordance with regulations and administrative 

7 guidance for housing vouchers administered by 

8 the Secretary of Housing and Urban Develop9 ment under section 8 of such Act. 

10 ‘‘(G) HOMEOWNERSHIP OPPORTUNITIES.— 

11 A voucher under this paragraph may be used by 

12 a tenant to make payments towards the pur13 chase of a single-family home anywhere in the 

14 United States, subject to subsidy limits for 

15 vouchers under this title and the same limita16 tions applicable under section 8(y) of the 

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

18 1437f(y) to the use of tenant-based assistance 

19 under such section 8 for homeownership. 

20 ‘‘(4) PREPAYMENT STANDARDS FOR PRE-1989

21 LOANS.—In the case of a loan made or insured 

22 under section 515 pursuant to a contract entered 

23 into before December 15, 1989: 

24 ‘‘(A) IN GENERAL.—Subject to subpara25 graph (B), the Secretary shall approve any 


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1 offer to prepay such a loan that meets the fol2 lowing requirements: 

3 ‘‘(i) The borrower under the loan has 

4 not been provided any assistance to extend 

5 low-income use pursuant to section 

6 502(c)(4) of this Act, as such section was 

7 in effect before the date of the enactment 

8 of the Saving America’s Rural Housing 

9 Act of 2006. 

10 ‘‘(ii) The loan was not at any time re11 stricted by servicing actions, including 

12 transfers. 

13 ‘‘(iii) The 20-year period during which 

14 the project is subject to use restrictions 

15 under the loan has concluded. 

16 ‘‘(B) PROHIBITION.—The Secretary may 

17 not approve any offer to prepay such a loan 

18 during the 20-year period during which the 

19 project is subject to use restrictions under the 

20 loan. 

21 ‘‘(5) SALE RESTRICTIONS.—During the period 

22 that begins upon the owner providing notice to the 

23 Secretary under paragraph (2)(B) and having a du24 ration of 75 days, the owner may not sell the prop25 erty except to a purchaser who enters into such 


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1 binding agreements for purchase at market rates as 

2 the Secretary considers necessary to continue the 

3 property use restrictions with respect to the project 

4 in accordance with this title for a period of 20 years. 

5 This paragraph may not be construed to prohibit an 

6 owner, during such period, from soliciting or receiv7 ing any offers of sale or purchase. 

8 ‘‘(6) DATABASE OF POTENTIAL BUYERS.—The 

9 Secretary shall establish and maintain a database of 

10 potential buyers of projects with loans made under 

11 section 515. Such database shall include only per12 sons who have expressed an interest to the Secretary 

13 in purchasing such projects at fair market value and 

14 maintaining the projects for use as affordable hous15 ing.’’. 

16 SEC. 4. CONFORMING AMENDMENTS TO TITLE V OF THE 

17 HOUSING ACT OF 1949. 

18 Title V of the Housing Act of 1949 is amended— 

19 (1) in section 502(b)(2) (42 U.S.C. 

20 1472(b)(2))— 

21 (A) by striking ‘‘or 515’’; and 

22 (B) by inserting before the semicolon at 

23 the end the following: ‘‘and any prepayment of 

24 a loan made or insured under section 515 shall 


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1 be subject to the provisions of subsection (i)’’; 

2 and 

3 (2) in section 537(b)(1) (42 U.S.C. 1490p– 

4 1(b)(1)), by inserting before the semicolon the fol5 lowing: ‘‘ and to administer the revitalization pro6 gram under section 544’’. 

Æ 


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