II 

112TH CONGRESS 

1ST SESSION S. 317 

To allow for use of existing Section 8 housing funds, so as to preserve 

and revitalize affordable housing options for low-income individuals. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 10, 2011 

Mr. WYDEN (for himself and Mr. MERKLEY) introduced the following bill; 

which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To allow for use of existing Section 8 housing funds, so 

as to preserve and revitalize affordable housing options 

for low-income individuals. 

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 ‘‘Affordable Housing 

5 Preservation and Revitalization Act of 2011’’. 


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1 SEC. 2. AFFORDABLE HOUSING PRESERVATION AND REVI2 TALIZATION PROGRAM. 

3 Section 8 of the United States Housing Act of 1937 

4 (42 U.S.C. 1437f) is amended by adding at the end the 

5 following: 

6 ‘‘(ff) AFFORDABLE HOUSING PRESERVATION AND

7 REVITALIZATION PROGRAM.— 

8 ‘‘(1) IN GENERAL.—The Secretary shall ensure 

9 that funds in the residual receipts account of an eli10 gible multifamily housing property are transferred, 

11 at the time of a qualified sale or exchange, to a pres12 ervation entity. 

13 ‘‘(2) PURPOSE.—The purpose of this subsection 

14 is to facilitate the transfer of multifamily housing 

15 projects with expiring housing assistance payments 

16 contracts to preservation entities that are committed 

17 to maintaining the affordability and preservation of 

18 such projects by allowing expanded access to existing 

19 residual receipts to assist with the acquisition and 

20 rehabilitation of the project. 

21 ‘‘(3) USE OF FUNDS.—A preservation entity 

22 that acquires an eligible multifamily housing prop23 erty through a qualified sale shall, subject to the ap24 proval of the housing agency, use the funds in the 

25 residual receipts account transferred to it, or for its 

26 benefit— 


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1 ‘‘(A) to pay for rehabilitation costs ap2 proved by the housing agency; 

3 ‘‘(B) to deposit funds into the replacement 

4 reserve account of the property; 

5 ‘‘(C) to pay for social and other services 

6 that directly benefit the tenants of such prop7 erty, but in any 1 year such payments may not 

8 exceed 10 percent of the balance of the residual 

9 receipts account of the property at the end of 

10 the prior fiscal year; 

11 ‘‘(D) to pay for costs associated with the 

12 acquisition of the property, but such payments 

13 may not exceed 50 percent of the amount in the 

14 residual receipts account of the property at the 

15 time of acquisition; and 

16 ‘‘(E) to pay for any other costs that have 

17 been approved by the housing agency and will 

18 directly benefit the tenants of the property. 

19 ‘‘(4) DEFINITIONS.—In this subsection, the fol20 lowing definitions shall apply: 

21 ‘‘(A) AFFORDABILITY AND USE RESTRIC22 TIONS.—The term ‘affordability and use restric23 tions’ means the affordability and use restric24 tions in connection with project-based housing 

25 assistance payments made under this section. 


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1 ‘‘(B) EXTENDED USE PERIOD.—The term 

2 ‘extended use period’ means the later of— 

3 ‘‘(i) 30 years after the close of the 

4 sale of an eligible multifamily housing 

5 property to a preservation entity, or 

6 ‘‘(ii) upon the expiration of the re7 maining useful life of the eligible multi8 family property taking into account any re9 habilitation undertaken in connection with 

10 the acquisition of said property by the 

11 preservation entity, as such remaining use12 ful life is determined by the housing agen13 cy, 

14 provided that, such extended use period shall 

15 terminate in the event that the Secretary is un16 able to provide Section 8 assistance on terms at 

17 least as advantageous to the preservation entity 

18 as exist at the time of the acquisition of such 

19 eligible multifamily housing property. 

20 ‘‘(C) ELIGIBLE MULTIFAMILY HOUSING

21 PROPERTY.—The term ‘eligible multifamily 

22 housing property’ means a project that— 

23 ‘‘(i) is receiving project-based housing 

24 assistance payments under this section; 

25 and 


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1 ‘‘(ii) was financed pursuant to part 

2 883 of title 24, Code of Federal Regula3 tions, on or after February 29, 1980. 

4 ‘‘(D) HOUSING AGENCY.—The term ‘hous5 ing agency’ means, with respect to any eligible 

6 multifamily housing property, the housing agen7 cy which administers housing assistance with 

8 respect to such property. 

9 ‘‘(E) PRESERVATION ENTITY.—The term 

10 ‘preservation entity’ means an entity— 

11 ‘‘(i) that is— 

12 ‘‘(I) a nonprofit corporation 

13 under State law that is exempt from 

14 Federal income taxation pursuant to 

15 paragraph (3) or (4) of section 501(c) 

16 of the Internal Revenue Code of 1986; 

17 or 

18 ‘‘(II) a limited partnership or 

19 limited liability company where the 

20 sole general partner or sole managing 

21 member of such ownership entity is a 

22 nonprofit corporation under State law 

23 which is exempt from Federal income 

24 taxation pursuant to paragraphs (3) 


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1 or (4) of section 501(c) of the Inter2 nal Revenue Code of 1986; and 

3 ‘‘(ii) approved by the housing agency 

4 that has the capacity to acquire and pre5 serve an eligible multifamily housing prop6 erty. 

7 ‘‘(F) QUALIFIED SALE.— 

8 ‘‘(i) IN GENERAL.—The term ‘quali9 fied sale’ means the sale of an eligible mul10 tifamily housing property to a preservation 

11 entity which agrees to maintain afford12 ability and use restrictions regarding the 

13 property that are— 

14 ‘‘(I) for a term of not less than 

15 the extended use period; and 

16 ‘‘(II) legally enforceable. 

17 ‘‘(ii) FUTURE APPLICABILITY OF RE18 STRICTIONS.—The restrictions under sub19 paragraph (A) shall be— 

20 ‘‘(I) binding on all successors 

21 and assigns of the preservation entity; 

22 and 

23 ‘‘(II) recorded as a restrictive 

24 covenant on the property pursuant to 

25 State law. 


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1 ‘‘(G) RESIDUAL RECEIPTS.—The term ‘re2 sidual receipts’ means— 

3 ‘‘(i) funds generated by a property in 

4 excess of the amount needed for operating 

5 expenses, operating reserve requirements, 

6 and allowable distributions to project own7 ers; and 

8 ‘‘(ii) includes any other funds that the 

9 Secretary, in his or her discretion, des10 ignates as residual receipts. 

11 ‘‘(5) RESIDUAL RECEIPTS NOT TREATED AS

12 FEDERAL FUNDS.—For the purposes of section 42 

13 of the Internal Revenue Code of 1986, residual re14 ceipts used or transferred under this section shall 

15 not be considered Federal funds.’’. 

Æ 


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