IIB

106TH CONGRESS

1ST SESSION H. R. 202

IN THE SENATE OF THE UNITED STATES

SEPTEMBER 28, 1999

Received; read twice and referred to the Committee on Banking, Housing, and

Urban Affairs

AN ACT

To provide for the preservation of assisted housing for lowincome elderly persons, disabled persons, and other families.

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 SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

2 (a) SHORT TITLE.—This Act may be cited as the

3 ‘‘Preserving Affordable Housing for Senior Citizens and

4 Families into the 21st Century Act’’.

5 (b) TABLE OF CONTENTS.—The table of contents for

6 this Act is as follows:

Sec. 1. Short title and table of contents.

Sec. 2. Regulations.

Sec. 3. Effective date.

TITLE I—CONVERSION OF FINANCING AND REFINANCING FOR

SECTION 202 SUPPORTIVE HOUSING FOR THE ELDERLY

Sec. 101. Conversion of financing

Sec. 102. Prepayment and refinancing.

TITLE II—AUTHORIZATION OF APPROPRIATIONS FOR SUPPORTIVE HOUSING FOR THE ELDERLY AND PERSONS WITH

DISABILITIES

Sec. 201. Supportive housing for elderly persons.

Sec. 202. Supportive housing for persons with disabilities.

Sec. 203. Service coordinators and congregate services for elderly and disabled

housing.

TITLE III—EXPANDING HOUSING OPPORTUNITIES FOR THE

ELDERLY AND PERSONS WITH DISABILITIES

Subtitle A—Housing for the Elderly

Sec. 301. Matching grant program.

Sec. 302. Eligibility of for-profit limited partnerships.

Sec. 303. Mixed funding sources.

Sec. 304. Authority to acquire structures.

Sec. 305. Mixed-income occupancy.

Sec. 306. Use of project reserves.

Sec. 307. Commercial activities.

Sec. 308. Mixed finance pilot program.

Sec. 309. Grants for conversion of elderly housing to assisted living facilities.

Sec. 310. Grants for conversion of public housing projects to assisted living facilities.

Sec. 311. Use of section 8 assistance for assisted living facilities.

Sec. 312. Annual HUD inventory of assisted housing designated for elderly persons.

Sec. 313. Treatment of applications.

Subtitle B—Housing for Persons With Disabilities

Sec. 321. Matching grant program.

Sec. 322. Eligibility of for-profit limited partnerships.
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Sec. 323. Mixed funding sources.

Sec. 324. Tenant-based assistance.

Sec. 325. Project size.

Sec. 326. Use of project reserves.

Sec. 327. Commercial activities.

Subtitle C—Other Provisions

Sec. 341. Service coordinators.

Sec. 342. Commission on Affordable Housing and Health Care Facility Needs

in the 21st Century.

TITLE IV—RENEWAL OF EXPIRING RENTAL ASSISTANCE

CONTRACTS AND PROTECTION OF RESIDENTS

Sec. 401. Findings and purpose.

Sec. 402. Renewal of expiring contracts and enhanced vouchers for project residents.

Sec. 403. Section 236 assistance.

Sec. 404. Matching grant program for affordable housing preservation.

Sec. 405. Rehabilitation of assisted housing.

Sec. 406. Technical assistance.

Sec. 407. Termination of section 8 contract and duration of renewal contract.

Sec. 408. Enhanced voucher eligibility for residents of flexible subsidy properties.

Sec. 409. Enhanced disposition authority.

Sec. 410. Assistance for nonprofit purchasers preserving affordable housing.

TITLE V—MORTGAGE INSURANCE FOR HEALTH CARE FACILITIES

AND HOME EQUITY CONVERSION MORTGAGES

Sec. 501. Rehabilitation of existing hospitals, nursing homes, and other facilities.

Sec. 502. New health care facilities.

Sec. 503. Hospitals and hospital-based health care facilities.

Sec. 504. Insurance for mortgages to refinance existing home equity conversion

mortgages.

1 SEC. 2. REGULATIONS.

2 The Secretary of Housing and Urban Development

3 shall issue any regulations to carry out this Act and the

4 amendments made by this Act that the Secretary deter5 mines may or will affect tenants of federally assisted hous6 ing only after notice and opportunity for public comment

7 in accordance with the procedure under section 553 of title

8 5, United States Code, applicable to substantive rules

9 (notwithstanding subsections (a)(2), (b)(B), and (d)(3) of
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1 such section). Notice of such proposed rulemaking shall

2 be provided by publication in the Federal Register. In

3 issuing such regulations, the Secretary shall take such ac4 tions as may be necessary to ensure that such tenants are

5 notified of, and provided an opportunity to participate in,

6 the rulemaking, as required by such section 553.

7 SEC. 3. EFFECTIVE DATE.

8 (a) IN GENERAL.—The provisions of this Act and the

9 amendments made by this Act are effective as of the date

10 of the enactment of this Act, unless such provisions or

11 amendments specifically provide for effectiveness or appli12 cability upon another date certain.

13 (b) EFFECT OF REGULATORY AUTHORITY.—Any au14 thority in this Act or the amendments made by this Act

15 to issue regulations, and any specific requirement to issue

16 regulations by a date certain, may not be construed to af17 fect the effectiveness or applicability of the provisions of

18 this Act or the amendments made by this Act under such

19 provisions and amendments and subsection (a) of this sec20 tion.
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1 TITLE I—CONVERSION OF FI2 NANCING AND REFINANCING

3 FOR SECTION 202 SUP4 PORTIVE HOUSING FOR THE

5 ELDERLY

6 SEC. 101. CONVERSION OF FINANCING

7 (a) IN GENERAL.—Subject to the provisions of this

8 section, at the request of the owner of a project assisted

9 under section 202 of the Housing Act of 1959 (as in effect

10 before the enactment of the Cranston-Gonzalez National

11 Affordable Housing Act) and section 8 of the United

12 States Housing Act of 1937 (or any other rental housing

13 assistance programs of the Department of Housing and

14 Urban Development, including the rent supplement pro15 gram under section 101 of the Housing and Urban Devel16 opment Act of 1965 (12 U.S.C. 1701s)), the Secretary

17 shall convert the financing of any such housing project to

18 financing under section 202 of the Housing Act of 1959,

19 as amended by section 801 of the Cranston-Gonzalez Na20 tional Affordable Housing Act (12 U.S.C. 1701q). In such

21 a conversion, the Secretary shall, if requested by the

22 owner, convert loans made under such section 202 (as in

23 effect before enactment of the Cranston-Gonzalez National

24 Affordable Housing Act), and shall convert section 8 con25 tracts (or such other contracts for rental housing assist-
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1 ance) provided in connection with such loans, into capital

2 advances and project rental assistance under section 202

3 (as amended by section 801 of the Cranston-Gonzalez Na4 tional Affordable Housing Act), respectively, in accordance

5 with this section.

6 (b) DEBT FORGIVENESS.—

7 (1) IN GENERAL.—Subject to paragraph (2), in

8 converting the financing of any housing project pur9 suant to this section, the Secretary shall cancel any

10 indebtedness to the Secretary relating to any re11 maining principal and interest under any loan for

12 the project made under section 202 of the Housing

13 Act of 1959 (as in effect before the enactment of the

14 Cranston-Gonzalez National Affordable Housing

15 Act).

16 (2) BUDGET ACT COMPLIANCE.—The authority

17 of the Secretary to cancel indebtedness under para18 graph (1) shall be effective only to the extent or in

19 such amounts as are or have been provided in ad20 vance in appropriation Acts.

21 (c) CANCELLATION OF RENTAL ASSISTANCE CON22 TRACTS AND USE OF PROJECT FUNDS.—

23 (1) IN GENERAL.—For each housing project for

24 which debt is canceled under subsection (b) of this

25 section pursuant to a request for conversion under
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1 subsection (a), the Secretary shall cancel any con2 tract for rental assistance for the project under sec3 tion 8 of the United States Housing Act of 1937 (or

4 any other contract for rental housing assistance

5 under a program of the Department of Housing and

6 Urban Development, including the rent supplement

7 program under section 101 of the Housing and

8 Urban Development Act of 1965 (12 U.S.C.

9 1701s)).

10 (2) USE OF UNEXPENDED AMOUNTS.—

11 Amounts previously obligated for such contract that

12 remain unexpended shall be used as follows:

13 (A) PROJECT RENTAL ASSISTANCE CON14 TRACT.—Remaining amounts shall be used

15 first, to the extent necessary, to provide rental

16 assistance for the project, under a contract for

17 project rental assistance under section

18 202(c)(2) of the Housing Act of 1959 (12

19 U.S.C. 1701q(c)(2)), that—

20 (i) has a duration that is not less than

21 the remainder of the section 8 or other

22 rental housing assistance contract can23 celed; and

24 (ii) provides assistance in an annual

25 amount that is equal to the aggregate
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1 amount provided during the last 12-month

2 period under the section 8 or other rental

3 housing assistance contract for the project

4 canceled (pursuant to paragraph (1) of

5 this subsection), less the portion of such

6 assistance that is attributable to debt serv7 ice for the loan on the project canceled

8 under subsection (b) of this section, sub9 ject to an annual adjustment of existing

10 rents under the contract by an operating

11 cost adjustment factor established by the

12 Secretary (which shall not result in a nega13 tive adjustment).

14 (B) CREDIT AGAINST LOAN CANCELLA15 TION.—Amounts remaining after compliance

16 with subparagraph (A) shall, on a fiscal year

17 basis, be transferred to the account covering the

18 loan for the project canceled pursuant to sub19 section (b) and shall be credited as offsetting

20 collection to such account, in an amount for

21 each fiscal year that is equal to the amount of

22 indebtedness canceled for such year pursuant

23 such subsection.

24 (C) RETROFITTING, RENOVATION, AND

25 SERVICE COORDINATORS.—Any amounts re-
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1 maining after compliance with subparagraphs

2 (A) and (B) may be used, to the extent the Sec3 retary considers appropriate, to retrofit or ren4 ovate the project or provide a service coordi5 nator for residents of the project, to the same

6 extent that such activities are authorized to be

7 provided under section 802 of the Cranston8 Gonzalez National Affordable Housing Act to

9 housing assisted under such section.

10 Any such unexpended amounts in excess of the

11 amount used in accordance with subparagraphs (A)

12 through (C) shall be recaptured by the Secretary.

13 (3) USE OF PROJECT FUNDS.—In converting

14 the financing of any housing project pursuant to this

15 section, the Secretary may authorize the owner of

16 the project to use any residual receipts held for the

17 project that exceed $500 per unit (or such other

18 amount as the Secretary may prescribe based on the

19 needs of the project) in accordance with paragraph

20 (2) to improve the market viability, affordability, or

21 service to low-income elderly residents of the project.

22 (d) THIRD PARTY PROCESSING.—The Secretary may

23 enter into contracts with public or private entities as the

24 Secretary considers appropriate to facilitate efficient proc-
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1 essing of elderly housing project conversions under this

2 section.

3 (e) TENANT PROTECTIONS.—Notwithstanding any

4 provision of section 202 of the Housing Act of 1959, as

5 amended by section 801 of the Cranston-Gonzalez Na6 tional Affordable Housing Act (12 U.S.C. 1701q)—

7 (1) any tenant who, at the time of the conver8 sion under this section of the financing for a housing

9 project, is lawfully residing in a dwelling unit in the

10 project, may not be considered to be ineligible for

11 continued residency in the project after such date

12 because such tenant is not a very low-income elderly

13 person; and

14 (2) very low-income persons with disabilities (as

15 such term is defined in section 811 of the Cranston16 Gonzalez National Affordable Housing Act) shall be

17 eligible for occupancy in such project, and units in

18 the project shall be reserved for occupancy by such

19 persons in not less than the same ratio that units

20 in such project are occupied, upon the date of con21 version under this section, by handicapped families

22 (as such term is defined in section 202 of the Hous23 ing Act of 1959, as in effect before the enactment

24 of the Cranston-Gonzalez National Affordable Hous25 ing Act).
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1 (f) WAIVER AUTHORITY.—The Secretary may waive

2 the applicability of any provision of law or regulation nec3 essary to carry out this section.

4 (g) STUDY OF DEBT FORGIVENESS.—

5 (1) IN GENERAL.—The Secretary shall conduct

6 an analysis of the net impact on the Federal budget

7 deficit or surplus of making available, on a one-time

8 basis, to sponsors of projects assisted under section

9 202 of the Housing Act of 1959 (as in effect before

10 the enactment of the Cranston-Gonzalez National

11 Affordable Housing Act), forgiveness of any indebt12 edness to the Secretary relating to any remaining

13 principal and interest under loans made under such

14 section, together with a dollar for dollar reduction in

15 the amount of rental assistance under section 8 of

16 the United States Housing Act of 1937 or other

17 rental assistance provided for such project. Such

18 analysis shall take into consideration the full cost of

19 future appropriations for rental assistance under

20 such section 8 expected to be provided if such debt

21 forgiveness does not take place, notwithstanding cur22 rent budgetary treatment of such actions pursuant

23 to the Congressional Budget Act of 1974.

24 (2) REPORT.—Not later than the expiration of

25 the 3-month period beginning on the date of the en-
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1 actment of this Act, the Secretary shall submit a re2 port to the Congress containing the quantitative re3 sults of the analysis and an enumeration of any

4 project or administrative benefits of such actions.

5 SEC. 102. PREPAYMENT AND REFINANCING.

6 (a) APPROVAL OF PREPAYMENT OF DEBT.—Upon

7 request of the project sponsor of a project assisted with

8 a loan under section 202 of the Housing Act of 1959 (as

9 in effect before the enactment of the Cranston-Gonzalez

10 National Affordable Housing Act), the Secretary shall ap11 prove the prepayment of any indebtedness to the Secretary

12 relating to any remaining principal and interest under the

13 loan as part of a prepayment plan under which—

14 (1) the project sponsor agrees to operate the

15 project until the maturity date of the original loan

16 under terms at least as advantageous to existing and

17 future tenants as the terms required by the original

18 loan agreement or any rental assistance payments

19 contract under section 8 of the United States Hous20 ing Act of 1937 (or any other rental housing assist21 ance programs of the Department of Housing and

22 Urban Development, including the rent supplement

23 program under section 101 of the Housing and

24 Urban Development Act of 1965 (12 U.S.C. 1701s))

25 relating to the project; and
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1 (2) the prepayment may involve refinancing of

2 the loan if such refinancing results in a lower inter3 est rate on the principal of the loan for the project

4 and in reductions in debt service related to such

5 loan.

6 (b) SOURCES OF REFINANCING.—In the case of pre7 payment under this section involving refinancing, the

8 project sponsor may refinance the project through any

9 third party source, including financing by State and local

10 housing finance agencies, use of tax-exempt bonds, multi11 family mortgage insurance under the National Housing

12 Act, reinsurance, or other credit enhancements, including

13 risk sharing as provided under section 542 of the Housing

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

15 1707 note). For purposes of underwriting a loan insured

16 under the National Housing Act, the Secretary may as17 sume that any section 8 rental assistance contract relating

18 to a project will be renewed for the term of such loan.

19 (c) USE OF UNEXPENDED AMOUNTS.—Upon execu20 tion of the refinancing for a project pursuant to this sec21 tion, the Secretary shall make available at least 50 percent

22 of the annual savings resulting from reduced section 8 or

23 other rental housing assistance contracts in a manner that

24 is advantageous to the tenants, including—
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1 (1) not more than 15 percent of the cost of in2 creasing the availability or provision of supportive

3 services, which may include the financing of service

4 coordinators and congregate services;

5 (2) rehabilitation, modernization, or retrofitting

6 of structures, common areas, or individual dwelling

7 units;

8 (3) construction of an addition or other facility

9 in the project, including assisted living facilities (or,

10 upon the approval of the Secretary, facilities located

11 in the community where the project sponsor refi12 nances a project under this section, or pools shared

13 resources from more than one such project); or

14 (4) rent reduction of unassisted tenants resid15 ing in the project according to a pro rata allocation

16 of shared savings resulting from the refinancing.

17 (d) USE OF CERTAIN PROJECT FUNDS.—The Sec18 retary shall allow a project sponsor that is prepaying and

19 refinancing a project under this section—

20 (1) to use any residual receipts held for that

21 project in excess of $500 per individual dwelling unit

22 for not more than 15 percent of the cost of activities

23 designed to increase the availability or provision of

24 supportive services; and
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1 (2) to use any reserves for replacement in ex2 cess of $1,000 per individual dwelling unit for activi3 ties described in paragraphs (2) and (3) of sub4 section (c).

5 (e) BUDGET ACT COMPLIANCE.—This section shall

6 be effective only to extent or in such amounts that are

7 provided in advance in appropriation Acts.

8 TITLE II—AUTHORIZATION OF

9 APPROPRIATIONS FOR SUP10 PORTIVE HOUSING FOR THE

11 ELDERLY AND PERSONS WITH

12 DISABILITIES

13 SEC. 201. SUPPORTIVE HOUSING FOR ELDERLY PERSONS.

14 Section 202 of the Housing Act of 1959 (12 U.S.C.

15 1701q) is amended by adding at the end the following new

16 subsection:

17 ‘‘(m) AUTHORIZATION OF APPROPRIATIONS.—There

18 is authorized to be appropriated for providing assistance

19 under this section $700,000,000 for fiscal year 2000 and

20 such sums as may be necessary for each of fiscal years

21 2001, 2002, 2003, and 2004. Of the amount provided in

22 appropriation Acts for assistance under this section in

23 each such fiscal year, 5 percent shall be available only for

24 providing assistance in accordance with the requirements

25 under subsection (c)(4) (relating to matching funds), ex-
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1 cept that if there insufficient eligible applicants for such

2 assistance, any amount remaining shall be used for assist3 ance under this section.’’.

4 SEC. 202. SUPPORTIVE HOUSING FOR PERSONS WITH DIS5 ABILITIES.

6 Section 811 of the Cranston-Gonzalez National Af7 fordable Housing Act (42 U.S.C. 8013) is amended—

8 (1) by redesignating subsection (m) as sub9 section (n); and

10 (2) by inserting after subsection (l) the fol11 lowing new subsection:

12 ‘‘(m) AUTHORIZATION OF APPROPRIATIONS.—There

13 is authorized to be appropriated for providing assistance

14 under this section $225,000,000 for fiscal year 2000 and

15 such sums as may be necessary for each of fiscal years

16 2001, 2002, 2003, and 2004. Of the amount provided in

17 appropriation Acts for assistance under this section in

18 each such fiscal year, 5 percent shall be available only for

19 providing assistance in accordance with the requirements

20 under subsection (d)(5) (relating to matching funds), ex21 cept that if there insufficient eligible applicants for such

22 assistance, any amount remaining shall be used for assist23 ance under this section.’’.
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1 SEC. 203. SERVICE COORDINATORS AND CONGREGATE

2 SERVICES FOR ELDERLY AND DISABLED

3 HOUSING.

4 (a) AUTHORIZATION OF APPROPRIATIONS FOR FED5 ERALLY ASSISTED HOUSING.—There is authorized to be

6 appropriated to the Secretary of Housing and Urban De7 velopment $50,000,000 for fiscal year 2000, and such

8 sums as may be necessary for each of fiscal years 2001

9 and 2002, for the following purposes:

10 (1) GRANTS FOR SERVICE COORDINATORS FOR

11 CERTAIN FEDERALLY ASSISTED MULTIFAMILY HOUS12 ING.—For grants under section 676 of the Housing

13 and Community Development Act of 1992 (42

14 U.S.C. 13632) for providing service coordinators.

15 (2) CONGREGATE SERVICES FOR FEDERALLY

16 ASSISTED HOUSING.—For contracts under section

17 802 of the Cranston-Gonzalez National Affordable

18 Housing Act (42 U.S.C. 8011) to provide congregate

19 services programs for eligible residents of eligible

20 housing projects under subparagraphs (B) through

21 (D) of subsection (k)(6) of such section.

22 (b) PUBLIC HOUSING.—There is authorized to be ap23 propriated to the Secretary of Housing and Urban Devel24 opment for fiscal year 2000 for grants for use only for

25 activities described in paragraph (2) of section 34(b) of
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1 the United States Housing Act of 1937 (42 U.S.C. 1437z–

2 6(b)(2))—

3 (1) such sums as may be necessary for renewal

4 of all grants made in prior fiscal years for providing

5 service coordinators and congregate services for the

6 elderly and disabled in public housing; and

7 (2) $11,000,000 for grants in addition to such

8 renewal grants.

9 TITLE III—EXPANDING HOUSING

10 OPPORTUNITIES FOR THE EL11 DERLY AND PERSONS WITH

12 DISABILITIES

13 Subtitle A—Housing for the Elderly

14 SEC. 301. MATCHING GRANT PROGRAM.

15 Section 202 of the Housing Act of 1959 (12 U.S.C.

16 1701q) is amended—

17 (1) in subsection (b), in the second sentence, by

18 inserting ‘‘or through matching grants under sub19 section (c)(4)’’ after ‘‘subsection (c)(1)’’; and

20 (2) in subsection (c), by adding at the end the

21 following new paragraph:

22 ‘‘(4) MATCHING GRANTS.—

23 ‘‘(A) IN GENERAL.—Amounts made avail24 able for assistance under this paragraph shall

25 be used only for capital advances in accordance
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1 with paragraph (1), except that the Secretary

2 shall require that, as a condition of providing

3 assistance under this paragraph for a project,

4 the applicant for assistance shall supplement

5 the assistance with amounts from sources other

6 than this section in an amount that is not less

7 than 25 to 50 percent (as the Secretary may

8 determine) of the amount of assistance provided

9 pursuant to this paragraph for the project.

10 ‘‘(B) REQUIREMENT FOR NON-FEDERAL

11 FUNDS.—Not less than 50 percent of supple12 mental amounts provided for a project pursuant

13 to subparagraph (A) shall be from non-Federal

14 sources. Such supplemental amounts may in15 clude the value of any in-kind contributions, in16 cluding donated land, structures, equipment,

17 and other contributions as the Secretary con18 siders appropriate, but only if the existence of

19 such in-kind contributions results in the con20 struction of more dwelling units than would

21 have been constructed absent such contribu22 tions.

23 ‘‘(C) INCOME ELIGIBILITY.—Notwith24 standing any other provision of this section, the

25 Secretary shall provide that, in a project as-
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1 sisted under this paragraph, a number of dwell2 ing units may be made available for occupancy

3 by elderly persons who are not very low-income

4 persons in a number such that the ratio that

5 the number of dwelling units in the project so

6 occupied bears to the total number of units in

7 the project does not exceed the ratio that the

8 amount from non-Federal sources provided for

9 the project pursuant to this paragraph bears to

10 the sum of the capital advances provided for the

11 project under this paragraph and all supple12 mental amounts for the project provided pursu13 ant to this paragraph.’’.

14 SEC. 302. ELIGIBILITY OF FOR-PROFIT LIMITED PARTNER15 SHIPS.

16 Section 202(k)(4) of the Housing Act of 1959 (12

17 U.S.C. 1701q(k)(4)) is amended by adding after and

18 below subparagraph (C) the following new sentence:

19 ‘‘Such term includes a for-profit limited partnership

20 the sole general partner of which is an organization

21 meeting the requirements under subparagraphs (A),

22 (B), and (C) and a corporation wholly owned by an

23 organization meeting the requirements under sub24 paragraphs (A), (B), and (C).’’.
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1 SEC. 303. MIXED FUNDING SOURCES.

2 Section 202(h)(6) of the Housing Act of 1959 (12

3 U.S.C. 1701q(h)(6)) is amended by striking ‘‘non-Federal

4 sources’’ and inserting ‘‘sources other than this section’’.

5 SEC. 304. AUTHORITY TO ACQUIRE STRUCTURES.

6 Section 202 of the Housing Act of 1959 (12 U.S.C.

7 1701q) is amended—

8 (1) in subsection (b), by striking ‘‘from the

9 Resolution Trust Corporation’’; and

10 (2) in subsection (h)(2)—

11 (A) in the heading for subparagraph (A),

12 by striking ‘‘RTC PROPERTIES’’ and inserting

13 ‘‘ACQUISITION’’; and

14 (B) by striking ‘‘from the Resolution’’ and

15 all that follows through ‘‘Insurance Act’’.

16 SEC. 305. MIXED-INCOME OCCUPANCY.

17 (a) IN GENERAL.—The first sentence of section

18 202(i)(1) of the Housing Act of 1959 (12 U.S.C.

19 1701q(i)(1)) is amended by striking ‘‘and (B)’’ and insert20 ing the following: ‘‘(B) notwithstanding clause (A) and in

21 the case only of a supportive housing project for the elder22 ly which has a high vacancy level (as such term is defined

23 by the Secretary, but which shall not include vacancy upon

24 the initial availability of units in a building), consistent

25 with the purpose of improving housing opportunities for

26 very low- and low-income elderly persons; and (C).’’.
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1 (b) AVAILABILITY OF UNITS.—Section 202(i) of the

2 Housing Act of 1959 (12 U.S.C. 1701q(i)) is amended by

3 adding at the end the following new paragraph:

4 ‘‘(3) AVAILABILITY OF UNITS.—In the case of

5 a supportive housing project described in subsection

6 (i)(1)(B) that has a vacant dwelling unit, an owner

7 may not make a dwelling unit available for occu8 pancy by, nor make any commitment to provide oc9 cupancy in the unit to, a low-income family that is

10 not a very low-income family unless each eligible

11 very low-income family that has applied for occu12 pancy in the project has been offered an opportunity

13 to accept occupancy in a unit in the project.’’.

14 (b) CONFORMING AMENDMENTS.—Section 202 of the

15 Housing Act of 1959 (12 U.S.C. 1701q) is amended—

16 (1) in subsection (c)—

17 (A) in paragraph (1), by inserting after

18 ‘‘elderly persons’’ the following: ‘‘, and for low19 income elderly persons to the extent such occu20 pancy is made available pursuant to subsection

21 (i)(1)(B),’’;

22 (B) in the first sentence of paragraph (2),

23 by inserting after ‘‘elderly persons’’ the fol24 lowing: ‘‘or by low-income elderly persons (to
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1 the extent such occupancy is made available

2 pursuant to subsection (i)(1)(B))’’; and

3 (C) in paragraph (3), by inserting after

4 ‘‘very low-income person’’ the following: ‘‘or a

5 low-income person (to the extent such occu6 pancy is made available pursuant to subsection

7 (i)(1)(B))’’;

8 (2) in subsection (d)(1), by inserting after ‘‘el9 derly persons’’ the following: ‘‘, and low-income el10 derly persons to the extent such occupancy is made

11 available pursuant to subsection (i)(1)(B),’’; and

12 (3) in subsection (k)—

13 (A) by redesignating paragraphs (3)

14 through (8) as paragraphs (4) through (9), re15 spectively; and

16 (B) by inserting after paragraph (2) the

17 following new paragraph:

18 ‘‘(3) LOW-INCOME.—The term ‘low-income’ has

19 the same meaning given the term ‘low-income fami20 lies’ under section 3(b)(2) of the United States

21 Housing Act of 1937 (42 U.S.C. 1437a(b)(2)).’’.

22 SEC. 306. USE OF PROJECT RESERVES.

23 Section 202(j) of the Housing Act of 1959 (12 U.S.C.

24 1701q(j)) is amended by adding at the end the following

25 new paragraph:
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1 ‘‘(8) USE OF PROJECT RESERVES.—Amounts

2 for project reserves for a project assisted under this

3 section may be used for costs, subject to reasonable

4 limitations as the Secretary determines appropriate,

5 for reducing the number of dwelling units in the

6 project. Such use shall be subject to the approval of

7 the Secretary to ensure that the use is designed to

8 retrofit units that are currently obsolete or unmar9 ketable.’’.

10 SEC. 307. COMMERCIAL ACTIVITIES.

11 Section 202(h)(1) of the Housing Act of 1959 (12

12 U.S.C. 1701q(h)(1)) is amended by adding at the end the

13 following new sentence: ‘‘Neither this section nor any

14 other provision of law may be construed as prohibiting or

15 preventing the location and operation, in a project assisted

16 under this section, of commercial facilities for the benefit

17 of residents of the project and the community in which

18 the project is located.’’.

19 SEC. 308. MIXED FINANCE PILOT PROGRAM.

20 (a) AUTHORITY.—The Secretary of Housing and

21 Urban Development shall carry out a pilot program under

22 this section to determine the effectiveness and feasibility

23 of providing assistance under section 202 of the Housing

24 Act of 1959 (12 U.S.C. 1701q) for housing projects that

25 are used both for supportive housing for the elderly and
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1 for other types of housing, which may include market rate

2 housing.

3 (b) SCOPE.—Under the pilot program the Secretary

4 shall provide, to the extent that sufficient approvable ap5 plications for such assistance are received, assistance in

6 the manner provided under subsection (d) for not more

7 than five housing projects.

8 (c) MIXED USE.—The Secretary shall require, for a

9 project to be assisted under the pilot program—

10 (1) that a portion of the dwelling units in the

11 project be reserved for use in accordance with, and

12 subject to, the requirements applicable to units as13 sisted under section 202 of the Housing Act of

14 1959; and

15 (2) that the remainder of the dwelling units be

16 used for other purposes.

17 (d) FINANCING.—The Secretary may use amounts

18 provided for assistance under section 202 of the Housing

19 Act of 1959 for assistance under the pilot program for

20 capital advances in accordance with subsection (d)(1) of

21 such section and project rental assistance in accordance

22 with subsection (d)(2) of such section, only for dwelling

23 units described in subsection (c)(1) of this section. Any

24 assistance provided pursuant to subsection (d)(1) of such

25 section 202 shall be provided in the form of a capital ad-
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1 vance, subject to repayment as provided in such sub2 section, and shall not be structured as a loan. The Sec3 retary shall take such action as may be necessary to en4 sure that the repayment contingency under such sub5 section is enforceable for projects assisted under the pilot

6 program and to provide for appropriate protections of the

7 interests of the Secretary in relation to other interests in

8 the projects so assisted.

9 (e) WAIVER AUTHORITY.—Notwithstanding sub10 section (c)(1) of this section, the Secretary may waive the

11 applicability of any provision of section 202 of the Hous12 ing Act of 1959 for any project assisted under the pilot

13 program under this section as may be appropriate to carry

14 out the program, except to the extent inconsistent with

15 this section.

16 SEC. 309. GRANTS FOR CONVERSION OF ELDERLY HOUSING

17 TO ASSISTED LIVING FACILITIES.

18 Title II of the Housing Act of 1959 is amended by

19 inserting after section 202a (12 U.S.C. 1701q–1) the fol20 lowing new section:

21 ‘‘SEC. 202b. GRANTS FOR CONVERSION OF ELDERLY HOUS22 ING TO ASSISTED LIVING FACILITIES.

23 ‘‘(a) GRANT AUTHORITY.—The Secretary of Housing

24 and Urban Development may make grants in accordance
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1 with this section to owners of eligible projects described

2 in subsection (b) for one or both of the following activities:

3 ‘‘(1) REPAIRS.—Substantial capital repairs to a

4 project that are needed to rehabilitate, modernize, or

5 retrofit aging structures, common areas, or indi6 vidual dwelling units.

7 ‘‘(2) CONVERSION.—Activities designed to con8 vert dwelling units in the eligible project to assisted

9 living facilities for elderly persons.

10 ‘‘(b) ELIGIBLE PROJECTS.—An eligible project de11 scribed in this subsection is a multifamily housing project

12 that is—

13 ‘‘(1) described in subparagraph (B), (C), (D),

14 (E), (F), or (G) of section 683(2) of the Housing

15 and Community Development Act of 1992 (42

16 U.S.C. 13641(2)), or (B) only to the extent amounts

17 of the Department of Agriculture are made available

18 to the Secretary of Housing and Urban Development

19 for such grants under this section for such projects,

20 subject to a loan made or insured under section 515

21 of the Housing Act of 1949 (42 U.S.C. 1485);

22 ‘‘(2) owned by a private nonprofit organization

23 (as such term is defined in section 202); and

24 ‘‘(3) designated primarily for occupancy by el25 derly persons.
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1 Notwithstanding any other provision of this subsection or

2 this section, an unused or underutilized commercial prop3 erty may be considered an eligible project under this sub4 section, except that the Secretary may not provide grants

5 under this section for more three such properties. For any

6 such projects, any reference under this section to dwelling

7 units shall be considered to refer to the premises of such

8 properties.

9 ‘‘(c) APPLICATIONS.—Applications for grants under

10 this section shall be submitted to the Secretary in accord11 ance with such procedures as the Secretary shall establish.

12 Such applications shall contain—

13 ‘‘(1) a description of the substantial capital re14 pairs or the proposed conversion activities for which

15 a grant under this section is requested;

16 ‘‘(2) the amount of the grant requested to com17 plete the substantial capital repairs or conversion ac18 tivities;

19 ‘‘(3) a description of the resources that are ex20 pected to be made available, if any, in conjunction

21 with the grant under this section; and

22 ‘‘(4) such other information or certifications

23 that the Secretary determines to be necessary or ap24 propriate.
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1 ‘‘(d) FUNDING FOR SERVICES.—The Secretary may

2 not make a grant under this section for conversion activi3 ties unless the application contains sufficient evidence, in

4 the determination of the Secretary, of firm commitments

5 for the funding of services to be provided in the assisted

6 living facility, which may be provided by third parties.

7 ‘‘(e) SELECTION CRITERIA.—The Secretary shall se8 lect applications for grants under this section based upon

9 selection criteria, which shall be established by the Sec10 retary and shall include—

11 ‘‘(1) in the case of a grant for substantial cap12 ital repairs, the extent to which the project to be re13 paired is in need of such repair, including such fac14 tors as the age of improvements to be repaired, and

15 the impact on the health and safety of residents of

16 failure to make such repairs;

17 ‘‘(2) in the case of a grant for conversion activi18 ties, the extent to which the conversion is likely to

19 provide assisted living facilities that are needed or

20 are expected to be needed by the categories of elder21 ly persons that the assisted living facility is intended

22 to serve, with a special emphasis on very low-income

23 elderly persons who need assistance with activities of

24 daily living;
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1 ‘‘(3) the inability of the applicant to fund the

2 repairs or conversion activities from existing finan3 cial resources, as evidenced by the applicant’s finan4 cial records, including assets in the applicant’s resid5 ual receipts account and reserves for replacement ac6 count;

7 ‘‘(4) the extent to which the applicant has evi8 denced community support for the repairs or conver9 sion, by such indicators as letters of support from

10 the local community for the repairs or conversion

11 and financial contributions from public and private

12 sources;

13 ‘‘(5) in the case of a grant for conversion activi14 ties, the extent to which the applicant demonstrates

15 a strong commitment to promoting the autonomy

16 and independence of the elderly persons that the as17 sisted living facility is intended to serve;

18 ‘‘(6) in the case of a grant for conversion activi19 ties, the quality, completeness, and managerial capa20 bility of providing the services which the assisted liv21 ing facility intends to provide to elderly residents,

22 especially in such areas as meals, 24-hour staffing,

23 and on-site health care; and
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1 ‘‘(7) such other criteria as the Secretary deter2 mines to be appropriate to ensure that funds made

3 available under this section are used effectively.

4 ‘‘(f) DEFINITIONS.—For the purposes of this

5 section—

6 ‘‘(1) the term ‘assisted living facility’ has the

7 meaning given such term in section 232(b) of the

8 National Housing Act (12 U.S.C. 1715w(b)); and

9 ‘‘(2) the definitions in section 202(k) shall

10 apply.

11 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There

12 is authorized to be appropriated for providing grants

13 under this section such sums as may be necessary for each

14 of fiscal years 2000, 2001, 2002, 2003, and 2004.’’.

15 SEC. 310. GRANTS FOR CONVERSION OF PUBLIC HOUSING

16 PROJECTS TO ASSISTED LIVING FACILITIES.

17 Title I of the United States Housing Act of 1937 (42

18 U.S.C. 1437 et seq.) is amended by adding at the end

19 the following new section:

20 ‘‘SEC. 36. GRANTS FOR CONVERSION OF PUBLIC HOUSING

21 TO ASSISTED LIVING FACILITIES.

22 ‘‘(a) GRANT AUTHORITY.—The Secretary may make

23 grants in accordance with this section to public housing

24 agencies for use for activities designed to convert dwelling
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1 units in an eligible projects described in subsection (b) to

2 assisted living facilities for elderly persons.

3 ‘‘(b) ELIGIBLE PROJECTS.—An eligible project de4 scribed in this subsection is a public housing project (or

5 a portion thereof) that has been designated under section

6 7 for occupancy only by elderly persons.

7 ‘‘(c) APPLICATIONS.—Applications for grants under

8 this section shall be submitted to the Secretary in accord9 ance with such procedures as the Secretary shall establish.

10 Such applications shall contain—

11 ‘‘(1) a description of the proposed conversion

12 activities for which a grant under this section is re13 quested;

14 ‘‘(2) the amount of the grant requested;

15 ‘‘(3) a description of the resources that are ex16 pected to be made available, if any, in conjunction

17 with the grant under this section; and

18 ‘‘(4) such other information or certifications

19 that the Secretary determines to be necessary or ap20 propriate.

21 ‘‘(d) FUNDING FOR SERVICES.—The Secretary may

22 not make a grant under this section unless the application

23 contains sufficient evidence, in the determination of the

24 Secretary, of firm commitments for the funding of services

25 to be provided in the assisted living facility.
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1 ‘‘(e) SELECTION CRITERIA.—The Secretary shall se2 lect applications for grants under this section based upon

3 selection criteria, which shall be established by the Sec4 retary and shall include—

5 ‘‘(1) the extent to which the conversion is likely

6 to provide assisted living facilities that are needed or

7 are expected to be needed by the categories of elder8 ly persons that the assisted living facility is intended

9 to serve;

10 ‘‘(2) the inability of the public housing agency

11 to fund the conversion activities from existing finan12 cial resources, as evidenced by the agency’s financial

13 records;

14 ‘‘(3) the extent to which the agency has evi15 denced community support for the conversion, by

16 such indicators as letters of support from the local

17 community for the conversion and financial contribu18 tions from public and private sources;

19 ‘‘(4) extent to which the applicant demonstrates

20 a strong commitment to promoting the autonomy

21 and independence of the elderly persons that the as22 sisted living facility is intended to serve;

23 ‘‘(5) the quality, completeness, and managerial

24 capability of providing the services which the as25 sisted living facility intends to provide to elderly
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1 residents, especially in such areas as meals, 24-hour

2 staffing, and on-site health care; and

3 ‘‘(6) such other criteria as the Secretary deter4 mines to be appropriate to ensure that funds made

5 available under this section are used effectively.

6 ‘‘(f) DEFINITION.—For the purposes of this section,

7 the term ‘assisted living facility’ has the meaning given

8 such term in section 232(b) of the National Housing Act

9 (12 U.S.C. 1715w(b)).

10 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There

11 is authorized to be appropriated for providing grants

12 under this section such sums as may be necessary for each

13 of fiscal years 2000, 2001, 2002, 2003, and 2004.’’.

14 SEC. 311. USE OF SECTION 8 ASSISTANCE FOR ASSISTED

15 LIVING FACILITIES.

16 (a) VOUCHER ASSISTANCE.—Section 8(o) of the

17 United States Housing Act of 1937 (42 U.S.C. 1437f(o))

18 is amended by adding at the end the following new para19 graph:

20 ‘‘(18) RENTAL ASSISTANCE FOR ASSISTED LIV21 ING FACILITIES.—

22 ‘‘(A) IN GENERAL.—A public housing

23 agency may make assistance payments on be24 half of a family that uses an assisted living fa25 cility as a principal place of residence and that
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1 uses such supportive services made available in

2 the facility as the agency may require. Such

3 payments may be made only for covering costs

4 of rental of the dwelling unit in the assisted liv5 ing facility and not for covering any portion of

6 the cost of residing in such facility that is at7 tributable to service relating to assisted living.

8 ‘‘(B) RENT CALCULATION.—

9 ‘‘(i) CHARGES INCLUDED.—For as10 sistance pursuant to this paragraph, the

11 rent of the dwelling unit that is a assisted

12 living facility with respect to which assist13 ance payments are made shall include

14 maintenance and management charges re15 lated to the dwelling unit and tenant-paid

16 utilities. Such rent shall not include any

17 charges attributable to services relating to

18 assisted living.

19 ‘‘(ii) PAYMENT STANDARD.—In deter20 mining the monthly assistance that may be

21 paid under this paragraph on behalf of any

22 family residing in an assisted living facil23 ity, the public housing agency shall utilize

24 the payment standard established under

25 paragraph (1), for the market area in
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1 which the assisted living facility is located,

2 for the applicable size dwelling unit.

3 ‘‘(iii) MONTHLY ASSISTANCE PAY4 MENT.—The monthly assistance payment

5 for a family assisted under this paragraph

6 shall be determined in accordance with

7 paragraph (2) (using the rent and payment

8 standard for the dwelling unit as deter9 mined in accordance with this subsection).

10 ‘‘(C) DEFINITION.—For the purposes of

11 this paragraph, the term ‘assisted living facility’

12 has the meaning given that term in section

13 232(b) of the National Housing Act (12 U.S.C.

14 1715w(b)), except that such a facility may be

15 contained within a portion of a larger multi16 family housing project.’’.

17 (b) PROJECT-BASED ASSISTANCE.—Section 202b of

18 the Housing Act of 1959, as added by section 2 of this

19 Act, is amended—

20 (1) by redesignating subsections (f) and (g) as

21 subsections (g) and (h), respectively; and

22 (2) by inserting after subsection (e) the fol23 lowing new subsection:

24 ‘‘(f) SECTION 8 PROJECT-BASED ASSISTANCE.—
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1 ‘‘(1) ELIGIBILITY.—Notwithstanding any other

2 provision of law, a multifamily project which in3 cludes one or more dwelling units that have been

4 converted to assisted living facilities using grants

5 made under this section shall be eligible for project6 based assistance under section 8 of the United

7 States Housing Act of 1937, in the same manner in

8 which the project would be eligible for such assist9 ance but for the assisted living facilities in the

10 project.

11 ‘‘(2) CALCULATION OF RENT.—For assistance

12 pursuant to this subsection, the maximum monthly

13 rent of a dwelling unit that is an assisted living fa14 cility with respect to which assistance payments are

15 made shall not include charges attributable to serv16 ices relating to assisted living.’’.

17 SEC. 312. ANNUAL HUD INVENTORY OF ASSISTED HOUSING

18 DESIGNATED FOR ELDERLY PERSONS.

19 Subtitle D of title VI of the Housing and Community

20 Development Act of 1992 (42 U.S.C. 13611 et seq.) is

21 amended by adding at the end the following new section:
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1 ‘‘SEC. 662. ANNUAL INVENTORY OF ASSISTED HOUSING

2 DESIGNATED FOR ELDERLY PERSONS.

3 ‘‘(a) IN GENERAL.—The Secretary shall establish

4 and maintain, and on an annual basis shall update and

5 publish, an inventory of housing that—

6 ‘‘(1) is assisted under a program of the Depart7 ment of Housing and Urban Development, including

8 all federally assisted housing; and

9 ‘‘(2) is designated, in whole or in part, for occu10 pancy by elderly families or disabled families, or

11 both.

12 ‘‘(b) CONTENTS.—The inventory required under this

13 section shall identify housing described in subsection (a)

14 and the number of dwelling units in such housing that—

15 ‘‘(1) are in projects designated for occupancy

16 only by elderly families;

17 ‘‘(2) are in projects designated for occupancy

18 only by disabled families;

19 ‘‘(3) contain special features or modifications

20 designed to accommodate persons with disabilities

21 and are in projects designated for occupancy only by

22 disabled families;

23 ‘‘(4) are in projects for which a specific per24 centage or number of the dwelling units are des25 ignated for occupancy only by elderly families;
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1 ‘‘(5) are in projects for which a specific per2 centage or number of the dwelling units are des3 ignated for occupancy only by disabled families; and

4 ‘‘(6) are in projects designed for occupancy only

5 by both elderly or disabled families.

6 ‘‘(c) PUBLICATION.—The Secretary shall annually

7 publish the inventory required under this section in the

8 Federal Register and shall make the inventory available

9 to the public by posting on a World Wide Web site of the

10 Department.’’.

11 SEC. 313. TREATMENT OF APPLICATIONS.

12 (a) IN GENERAL.—Notwithstanding any other provi13 sion of law or any regulation of the Secretary of Housing

14 and Urban Development, in the case of any denial of an

15 application for assistance under section 202 of the Hous16 ing Act of 1959 (12 U.S.C. 1701q) for failure to timely

17 provide information required by the Secretary, the Sec18 retary shall notify the applicant of the failure and provide

19 the applicant an opportunity to show that the failure was

20 due to the failure of a third party to provide information

21 under the control of the third party. If the applicant dem22 onstrates, within a reasonable period of time after notifi23 cation of such failure, that the applicant did not have such

24 information but requested the timely provision of such in25 formation by the third party, the Secretary may not deny
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1 the application on the grounds of failure to timely provide

2 such information.

3 (b) APPLICABILITY.—This section shall have no force

4 or effect after the expiration of the 12-month period begin5 ning on the date of the enactment of this Act.

6 Subtitle B—Housing for Persons

7 With Disabilities

8 SEC. 321. MATCHING GRANT PROGRAM.

9 Section 811 of the Cranston-Gonzalez National Af10 fordable Housing Act (42 U.S.C. 8013) is amended—

11 (1) in subsection (b)(2)(A), by inserting ‘‘or

12 through matching grants under subsection (d)(5)’’

13 after ‘‘subsection (d)(1)’’; and

14 (2) in subsection (d), by adding at the end the

15 following new paragraph:

16 ‘‘(5) MATCHING GRANTS.—

17 ‘‘(A) IN GENERAL.—Amounts made avail18 able for assistance under this paragraph shall

19 be used only for capital advances in accordance

20 with paragraph (1), except that the Secretary

21 shall require that, as a condition of providing

22 assistance under this paragraph for a project,

23 the applicant for assistance shall supplement

24 the assistance with amounts from sources other

25 than this section in an amount that is not less
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1 than 25 to 50 percent (as the Secretary may

2 determine) of the amount of assistance provided

3 pursuant to this paragraph for the project.

4 ‘‘(B) REQUIREMENT FOR NON-FEDERAL

5 FUNDS.—Not less than 50 percent of supple6 mental amounts provided for a project pursuant

7 to subparagraph (A) shall be from non-Federal

8 sources. Such supplemental amounts may in9 clude the value of any in-kind contributions, in10 cluding donated land, structures, equipment,

11 and other contributions as the Secretary con12 siders appropriate, but only if the existence of

13 such in-kind contributions results in the con14 struction of more dwelling units than would

15 have been constructed absent such contribu16 tions.

17 ‘‘(C) INCOME ELIGIBILITY.—Notwith18 standing any other provision of this section, the

19 Secretary shall provide that, in a project as20 sisted under this paragraph, a number of dwell21 ing units may be made available for occupancy

22 by persons with disabilities who are not very

23 low-income persons in a number such that the

24 ration that the number of dwelling units in the

25 project so occupied bears to the total number of
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1 units in the project does not exceed the ratio

2 that the amount from non-Federal sources pro3 vided for the project pursuant to this paragraph

4 bears to the sum of the capital advances pro5 vided for the project under this paragraph and

6 all supplemental amounts for the project pro7 vided pursuant to this paragraph.’’.

8 SEC. 322. ELIGIBILITY OF FOR-PROFIT LIMITED PARTNER9 SHIPS.

10 Section 811(k)(6) of the Housing Act of 1959 (42

11 U.S.C. 8013(k)(6)) is amended by adding after and below

12 subparagraph (D) the following new sentence:

13 ‘‘Such term includes a for-profit limited partnership

14 the sole general partner of which is an organization

15 meeting the requirements under subparagraphs (A),

16 (B), (C), and (D) and a corporation wholly owned

17 by an organization meeting the requirements under

18 subparagraphs (A), (B), (C), and (D).’’.

19 SEC. 323. MIXED FUNDING SOURCES.

20 Section 811(h)(5) of the Cranston-Gonzalez National

21 Affordable Housing Act (42 U.S.C. 8013(h)(5)) is amend22 ed by striking ‘‘non-Federal sources’’ and inserting

23 ‘‘sources other than this section’’.
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1 SEC. 324. TENANT-BASED ASSISTANCE.

2 Section 811 of the Cranston-Gonzalez National Af3 fordable Housing Act (42 U.S.C. 8013) is amended—

4 (1) in subsection (d), by striking paragraph (4)

5 and inserting the following new paragraph:

6 ‘‘(4) TENANT-BASED RENTAL ASSISTANCE.—

7 ‘‘(A) ADMINISTERING ENTITIES.—Tenant8 based rental assistance provided under sub9 section (b)(1) may be provided only through a

10 public housing agency that has submitted and

11 had approved an plan under section 7(d) of the

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

13 1437e(d)) that provides for such assistance, or

14 through a private nonprofit organization. A

15 public housing agency shall be eligible to apply

16 under this section only for the purposes of pro17 viding such tenant-based rental assistance.

18 ‘‘(B) PROGRAM RULES.—Tenant-based

19 rental assistance under subsection (b)(1) shall

20 be made available to eligible persons with dis21 abilities and administered under the same rules

22 that govern tenant-based rental assistance made

23 available under section 8 of the United States

24 Housing Act of 1937, except that the Secretary

25 may waive or modify such rules, but only to the

26 extent necessary to provide for administering
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1 such assistance under subsection (b)(1) through

2 private nonprofit organizations rather than

3 through public housing agencies.

4 ‘‘(C) ALLOCATION OF ASSISTANCE.—In de5 termining the amount of assistance provided

6 under subsection (b)(1) for a private nonprofit

7 organization or public housing agency, the Sec8 retary shall consider the needs and capabilities

9 of the organization or agency, in the case of a

10 public housing agency, as described in the plan

11 for the agency under section 7 of the United

12 States Housing Act of 1937.’’; and

13 (2) in subsection (l)(1)—

14 (A) by striking ‘‘subsection (b)’’ and in15 serting ‘‘subsection (b)(2)’’;

16 (B) by striking the last comma and all

17 that follows through ‘‘subsection (n)’’; and

18 (C) by inserting after the last period the

19 following new sentence: ‘‘Notwithstanding any

20 other provision of this section, the Secretary

21 may use not more than 25 percent of the total

22 amounts made available for assistance under

23 this section for any fiscal year for tenant-based

24 rental assistance under subsection (b)(1) for

25 persons with disabilities, and no authority of
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1 the Secretary to waive provisions of this section

2 may be used to alter the percentage limitation

3 under this sentence.’’.

4 SEC. 325. PROJECT SIZE.

5 (a) LIMITATION.—Section 811 of the Cranston-Gon6 zalez National Affordable Housing Act (42 U.S.C. 8013)

7 is amended—

8 (1) in subsection (k)(4), by inserting ‘‘, subject

9 to the limitation under subsection (h)(6)’’ after

10 ‘‘prescribe’’; and

11 (2) in subsection (l), by adding at the end the

12 following new paragraph:

13 ‘‘(4) SIZE LIMITATION.—Of any amounts made

14 available for any fiscal year and used for capital ad15 vances or project rental assistance under paragraphs

16 (1) and (2) of subsection (d), not more than 25 per17 cent may be used for supportive housing which con18 tains more than 24 separate dwelling units.’’.

19 (b) STUDY.—Not later than the expiration of the 3-

20 month period beginning on the date of the enactment of

21 this Act, the Secretary of Housing and Urban Develop22 ment shall conduct a study and submit a report to the

23 Congress regarding—

24 (1) the extent to which the authority of the Sec25 retary under section 811(k)(4) of the Cranston-Gon-
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1 zalez National Affordable Housing Act (42 U.S.C.

2 8013(k)(4)), as in effect immediately before the en3 actment of this Act, has been used in each year

4 since 1990 to provide for assistance under such sec5 tion for supportive housing for persons with disabil6 ities having more than 24 separate dwelling units;

7 (2) the per-unit costs of, and the benefits and

8 problems associated with, providing such housing in

9 projects having 8 or less dwelling units, 8 to 24

10 units, and more than 24 units; and

11 (3) the per-unit costs of, and the benefits and

12 problems associated with providing housing under

13 section 202 of the Housing Act of 1959 (12 U.S.C.

14 1701q) in projects having 30 to 50 dwelling units,

15 in projects having more than 50 but not more than

16 80 dwelling units, in projects having more than 80

17 but not more than 120 dwelling units, and in

18 projects having more than 120 dwelling units, but

19 the study shall also examine the social consider20 ations afforded by smaller and moderate-size devel21 opments and shall not be limited to economic fac22 tors.
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1 SEC. 326. USE OF PROJECT RESERVES.

2 Section 811(j) of the Cranston-Gonzalez National Af3 fordable Housing Act (42 U.S.C. 8013(j)) is amended by

4 adding at the end the following new paragraph:

5 ‘‘(7) USE OF PROJECT RESERVES.—Amounts

6 for project reserves for a project assisted under this

7 section may be used for costs, subject to reasonable

8 limitations as the Secretary determines appropriate,

9 for reducing the number of dwelling units in the

10 project. Such use shall be subject to the approval of

11 the Secretary to ensure that the use is designed to

12 retrofit units that are currently obsolete or unmar13 ketable.’’.

14 SEC. 327. COMMERCIAL ACTIVITIES.

15 Section 811(h)(1) of the Cranston-Gonzalez National

16 Affordable Housing Act (42 U.S.C. 8013(h)(1)) is amend17 ed by adding at the end the following new sentence: ‘‘Nei18 ther this section nor any other provision of law may be

19 construed as prohibiting or preventing the location and op20 eration, in a project assisted under this section, of com21 mercial facilities for the benefit of residents of the project

22 and the community in which the project is located.’’.

23 Subtitle C—Other Provisions

24 SEC. 341. SERVICE COORDINATORS.

25 (a) INCREASED FLEXIBILITY FOR USE OF SERVICE

26 COORDINATORS IN CERTAIN FEDERALLY ASSISTED
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1 HOUSING.—Section 676 of the Housing and Community

2 Development Act of 1992 (42 U.S.C. 13632) is

3 amended—

4 (1) in the section heading, by striking ‘‘MULTI5 FAMILY HOUSING ASSISTED UNDER THE NA6 TIONAL HOUSING ACT’’ and inserting ‘‘CERTAIN

7 FEDERALLY ASSISTED HOUSING’’;

8 (2) in subsection (a)—

9 (A) in the first sentence, by striking ‘‘(E)

10 and (F)’’ and inserting ‘‘(B), (C), (D), (E),

11 (F), and (G)’’; and

12 (B) in the last sentence—

13 (i) by striking ‘‘section 661’’ and in14 serting ‘‘section 671’’; and

15 (ii) by adding after the period at the

16 end the following new sentence: ‘‘A service

17 coordinator funded with a grant under this

18 section for a project may provide services

19 to low-income elderly or disabled families

20 living in the vicinity of such project.’’;

21 (3) in subsection (d)—

22 (A) by striking ‘‘(E) or (F)’’ and inserting

23 ‘‘(B), (C), (D), (E), (F), or (G)’’; and

24 (B) by striking ‘‘section 661’’ and insert25 ing ‘‘section 671’’; and
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1 (4) by striking subsection (c) and redesignating

2 subsection (d) (as amended by paragraph (3) of this

3 subsection) as subsection (c).

4 (b) REQUIREMENT TO PROVIDE SERVICE COORDINA5 TORS.—Section 671 of the Housing and Community De6 velopment Act of 1992 (42 U.S.C. 13631) is amended—

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

8 striking ‘‘to carry out this subtitle pursuant to the

9 amendments made by this subtitle’’ and inserting

10 the following: ‘‘for providing service coordinators

11 under this section’’;

12 (2) in subsection (d), by inserting ‘‘)’’ after

13 ‘‘section 683(2)’’; and

14 (3) by adding at the end following new sub15 section:

16 ‘‘(e) SERVICES FOR LOW-INCOME ELDERLY OR DIS17 ABLED FAMILIES RESIDING IN VICINITY OF CERTAIN

18 PROJECTS.—To the extent only that this section applies

19 to service coordinators for covered federally assisted hous20 ing described in subparagraphs (B), (C), (D), (E), (F),

21 and (G) of section 683(2), any reference in this section

22 to elderly or disabled residents of a project shall be con23 strued to include low-income elderly or disabled families

24 living in the vicinity of such project.’’.
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1 (c) PROTECTION AGAINST TELEMARKETING

2 FRAUD.—

3 (1) SUPPORTIVE HOUSING FOR THE ELDER4 LY.—The first sentence of section 202(g)(1) of the

5 Housing Act of 1959 (12 U.S.C. 1701q(g)(1)) is

6 amended by striking ‘‘and (F)’’ and inserting the

7 following: ‘‘(F) providing education and outreach re8 garding telemarketing fraud, in accordance with the

9 standards issued under section 671(f) of the Hous10 ing and Community Development Act of 1992 (42

11 U.S.C. 13631(f)); and (G)’’.

12 (2) OTHER FEDERALLY ASSISTED HOUSING.—

13 Section 671 of the Housing and Community Devel14 opment Act of 1992 (42 U.S.C. 13631), as amended

15 by subsection (b) of this section, is further

16 amended—

17 (A) in the first sentence of subsection (c),

18 by inserting after ‘‘response,’’ the following:

19 ‘‘providing education and outreach regarding

20 telemarketing fraud, in accordance with the

21 standards issued under subsection (f),’’; and

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

23 subsection:

24 ‘‘(f) PROTECTION AGAINST TELEMARKETING

25 FRAUD.—
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1 ‘‘(1) IN GENERAL.—The Secretary, in coordina2 tion with the Secretary of Health and Human Serv3 ices, shall establish standards for service coordina4 tors in federally assisted housing who are providing

5 education and outreach to elderly persons residing in

6 such housing regarding telemarketing fraud. The

7 standards shall be designed to ensure that such edu8 cation and outreach informs such elderly persons of

9 the dangers of telemarketing fraud and facilitates

10 the investigation and prosecution of telemarketers

11 engaging in fraud against such residents.

12 ‘‘(2) CONTENTS.—The standards established

13 under this subsection shall require that any such

14 education and outreach be provided in a manner

15 that—

16 ‘‘(A) informs such residents of (i) the prev17 alence of telemarketing fraud targeted against

18 elderly persons; (ii) how telemarketing fraud

19 works; (iii) how to identify telemarketing fraud;

20 (iv) how to protect themselves against tele21 marketing fraud, including an explanation of

22 the dangers of providing bank account, credit

23 card, or other financial or personal information

24 over the telephone to unsolicited callers; (v) how

25 to report suspected attempts at telemarketing
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1 fraud; and (vi) their consumer protection rights

2 under Federal law;

3 ‘‘(B) provides such other information as

4 the Secretary considers necessary to protect

5 such residents against fraudulent telemarketing;

6 and

7 ‘‘(C) disseminates the information provided

8 by appropriate means, and in determining such

9 appropriate means, the Secretary shall consider

10 on-site presentations at federally assisted hous11 ing, public service announcements, a printed

12 manual or pamphlet, an Internet website, and

13 telephone outreach to residents whose names

14 appear on ‘mooch lists’ confiscated from fraud15 ulent telemarketers.’’.

16 SEC. 342. COMMISSION ON AFFORDABLE HOUSING AND

17 HEALTH CARE FACILITY NEEDS IN THE 21ST

18 CENTURY.

19 (a) ESTABLISHMENT.—There is hereby established a

20 commission to be known as the Commission on Affordable

21 Housing and Health Care Facility Needs in the 21st Cen22 tury (in this section referred to as the ‘‘Commission’’.

23 (b) STUDY.—The duty of the Commission shall be to

24 conduct a study that—
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1 (1) compiles and interprets information regard2 ing the expected increase in the population of per3 sons 62 years of age or older, particularly informa4 tion regarding distribution of income levels, home5 ownership and home equity rates, and degree or ex6 tent of health and independence of living;

7 (2) provides an estimate of the future needs of

8 seniors for affordable housing and assisted living

9 and health care facilities;

10 (3) provides a comparison of estimate of such

11 future needs with an estimate of the housing and fa12 cilities expected to be provided under existing public

13 programs, and identifies possible actions or initia14 tives that may assist in providing affordable housing

15 and assisted living and health care facilities to meet

16 such expected needs;

17 (4) identifies and analyzes methods of encour18 aging increased private sector participation, invest19 ment, and capital formation in affordable housing

20 and assisted living and health care facilities for sen21 iors through partnerships between public and private

22 entities and other creative strategies;

23 (5) analyzes the costs and benefits of com24 prehensive aging-in-place strategies, taking into con25 sideration physical and mental well-being and the
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1 importance of coordination between shelter and sup2 portive services;

3 (6) identifies and analyzes methods of pro4 moting a more comprehensive approach to dealing

5 with housing and supportive service issues involved

6 in aging and the multiple governmental agencies in7 volved in such issues, including the Department of

8 Housing and Urban Development and the Depart9 ment of Health and Human Services; and

10 (7) examines how to establish intergenerational

11 learning and care centers and living arrangements,

12 in particular to facilitate appropriate environments

13 for families consisting only of children and a grand14 parent or grandparents who are the head of the

15 household.

16 (c) MEMBERSHIP.—

17 (1) NUMBER AND APPOINTMENT.—The Com18 mission shall be composed of 14 members, appointed

19 not later than January 1, 2000, as follows:

20 (A) Two co-chairpersons, of whom—

21 (i) one co-chairperson shall be ap22 pointed by a committee consisting of the

23 chairman of the Subcommittee on Housing

24 and Community Opportunities of the

25 House of Representatives and the chair-
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1 man of the Subcommittee on Housing and

2 Transportation of the Senate, and the

3 chairmen of the Subcommittees on the De4 partments of Veterans Affairs and Hous5 ing and Urban Development, and Inde6 pendent Agencies of the Committees on

7 Appropriations of the House of Represent8 atives and the Senate; and

9 (ii) one co-chairperson shall be ap10 pointed by a committee consisting of the

11 ranking minority member of the Sub12 committee on Housing and Community

13 Opportunities of the House of Representa14 tives and the ranking minority member of

15 the Subcommittee on Housing and Trans16 portation of the Senate, and the ranking

17 minority members of the Subcommittees

18 on the Departments of Veterans Affairs

19 and Housing and Urban Development, and

20 Independent Agencies of the Committees

21 on Appropriations of the House of Rep22 resentatives and the Senate.

23 (B) Six members appointed by the Chair24 man and Ranking Minority Member of the

25 Committee on Banking and Financial Services
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1 of the House of Representatives and the Chair2 man and Ranking Minority Member of the

3 Committee on Appropriations of the House of

4 Representatives.

5 (C) Six members appointed by the Chair6 man and Ranking Minority Member of the

7 Committee on Banking, Housing, and Urban

8 Affairs of the Senate and the Chairman and

9 Ranking Minority Member of the Committee on

10 Appropriations of the Senate.

11 (2) QUALIFICATIONS.—Appointees should have

12 proven expertise in directing, assembling, or apply13 ing capital resources from a variety of sources to the

14 successful development of affordable housing, as15 sisted living facilities, or health care facilities.

16 (3) VACANCIES.—Any vacancy on the Commis17 sion shall not affect its powers and shall be filled in

18 the manner in which the original appointment was

19 made.

20 (4) CHAIRPERSONS.—The members appointed

21 pursuant to paragraph (1)(A) shall serve as co22 chairpersons of the Commission.

23 (5) PROHIBITION OF PAY.—Members of the

24 Commission shall serve without pay.
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1 (6) TRAVEL EXPENSES.—Each member of the

2 Commission shall receive travel expenses, including

3 per diem in lieu of subsistence, in accordance with

4 sections 5702 and 5703 of title 5, United States

5 Code.

6 (7) QUORUM.—A majority of the members of

7 the Commission shall constitute a quorum but a

8 lesser number may hold hearings.

9 (8) MEETINGS.—The Commission shall meet at

10 the call of the Chairpersons.

11 (d) DIRECTOR AND STAFF.—

12 (1) DIRECTOR.—The Commission shall have a

13 Director who shall be appointed by the Chairperson.

14 The Director shall be paid at a rate not to exceed

15 the rate of basic pay payable for level V of the Exec16 utive Schedule.

17 (2) STAFF.—The Commission may appoint per18 sonnel as appropriate. The staff of the Commission

19 shall be appointed subject to the provisions of title

20 5, United States Code, governing appointments in

21 the competitive service, and shall be paid in accord22 ance with the provisions of chapter 51 and sub23 chapter III of chapter 53 of that title relating to

24 classification and General Schedule pay rates.
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1 (3) EXPERTS AND CONSULTANTS.—The Com2 mission may procure temporary and intermittent

3 services under section 3109(b) of title 5, United

4 States Code, but at rates for individuals not to ex5 ceed the daily equivalent of the maximum annual

6 rate of basic pay payable for the General Schedule.

7 (4) STAFF OF FEDERAL AGENCIES.—Upon re8 quest of the Commission, the head of any Federal

9 department or agency may detail, on a reimbursable

10 basis, any of the personnel of that department or

11 agency to the Commission to assist it in carrying out

12 its duties under this Act.

13 (e) POWERS.—

14 (1) HEARINGS AND SESSIONS.—The Commis15 sion may, for the purpose of carrying out this sec16 tion, hold hearings, sit and act at times and places,

17 take testimony, and receive evidence as the Commis18 sion considers appropriate.

19 (2) POWERS OF MEMBERS AND AGENTS.—Any

20 member or agent of the Commission may, if author21 ized by the Commission, take any action which the

22 Commission is authorized to take by this section.

23 (3) OBTAINING OFFICIAL DATA.—The Commis24 sion may secure directly from any department or

25 agency of the United States information necessary
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1 to enable it to carry out this Act. Upon request of

2 the Chairpersons of the Commission, the head of

3 that department or agency shall furnish that infor4 mation to the Commission.

5 (4) GIFTS, BEQUESTS, AND DEVISES.—The

6 Commission may accept, use, and dispose of gifts,

7 bequests, or devises of services or property, both real

8 and personal, for the purpose of aiding or facili9 tating the work of the Commission. Gifts, bequests,

10 or devises of money and proceeds from sales of other

11 property received as gifts, bequests, or devises shall

12 be deposited in the Treasury and shall be available

13 for disbursement upon order of the Commission.

14 (5) MAILS.—The Commission may use the

15 United States mails in the same manner and under

16 the same conditions as other departments and agen17 cies of the United States.

18 (6) ADMINISTRATIVE SUPPORT SERVICES.—

19 Upon the request of the Commission, the Adminis20 trator of General Services shall provide to the Com21 mission, on a reimbursable basis, the administrative

22 support services necessary for the Commission to

23 carry out its responsibilities under this section.

24 (7) CONTRACT AUTHORITY.—The Commission

25 may contract with and compensate government and
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1 private agencies or persons for services, without re2 gard to section 3709 of the Revised Statutes (41

3 U.S.C. 5).

4 (f) REPORT.—The Commission shall submit to the

5 Committees on Banking and Financial Services and Ap6 propriations of the House of Representatives and the

7 Committees on Banking, Housing, and Urban Affairs and

8 Appropriations of the Senate, a final report not later than

9 December 31, 2001. The report shall contain a detailed

10 statement of the findings and conclusions of the Commis11 sion with respect to the study conducted under subsection

12 (b), together with its recommendations for legislation, ad13 ministrative actions, and any other actions the Commis14 sion considers appropriate.

15 (g) FUNDING.—Of any amounts appropriated for fis16 cal year 2000 to carry out title V of the Housing and

17 Urban Development Act of 1970 (12 U.S.C. 1701z–1 et

18 seq.) $500,000 shall be available to the Commission for

19 carrying out this section.

20 (h) TERMINATION.—The Commission shall terminate

21 on June 30, 2002. Section 14(a)(2)(B) of the Federal Ad22 visory Committee Act (5 U.S.C. App.; relating to the ter23 mination of advisory committees) shall not apply to the

24 Commission.
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1 TITLE IV—RENEWAL OF EXPIR2 ING RENTAL ASSISTANCE

3 CONTRACTS AND PROTEC4 TION OF RESIDENTS

5 SEC. 401. FINDINGS AND PURPOSE.

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

7 (1) there exists throughout the United States a

8 need for decent, safe and affordable housing;

9 (2) affordable housing is critical to the well10 being of seniors, persons with disabilities, and vul11 nerable families;

12 (3) an unprecedented number of contracts for

13 Federal rental assistance are expiring now and will

14 expire in the near future;

15 (4) a significant number of private owners of

16 affordable housing developments are choosing to not

17 renew their subsidy contracts with the Federal Gov18 ernment;

19 (5) in cases where assistance contracts are not

20 renewed, rent levels in the affected developments

21 may rise dramatically;

22 (6) a significant number of residents in these

23 developments are seniors or persons with disabilities

24 or are otherwise vulnerable because of scarcity of

25 available affordable housing in the neighborhood,
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1 and have little or no means of paying additional rent

2 from personal income, putting at risk what have

3 been their homes for almost a quarter of a century;

4 and

5 (7) the Federal Government should continue to

6 work to ensure that those least able to provide for

7 themselves enjoy the protection and welfare of the

8 people of the United States.

9 (b) PURPOSE.—The purpose of this title is to protect

10 seniors, persons with disabilities, and other vulnerable

11 residents of affordable housing and to help provide those

12 residents with peace of mind and security for living—

13 (1) by providing greater rental assistance flexi14 bility to ensure that vulnerable populations are not

15 forced to move from their homes when rent levels

16 rise; and

17 (2) where appropriate, by encouraging private

18 owners of affordable housing developments to con19 tinue serving low-income families by providing ap20 propriate levels of Federal resources, by allowing

21 greater flexibility for refinancing, and by ensuring

22 more effective administration by the Federal Govern23 ment of rental assistance contract renegotiations.
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1 SEC. 402. RENEWAL OF EXPIRING CONTRACTS AND EN2 HANCED VOUCHERS FOR PROJECT RESI3 DENTS.

4 (a) IN GENERAL.—Section 524 of the Multifamily

5 Assisted Housing Reform and Affordability Act of 1997

6 (42 U.S.C. 1437f note) is amended to read as follows:

7 ‘‘SEC. 524. RENEWAL OF EXPIRING PROJECT-BASED SEC8 TION 8 CONTRACTS.

9 ‘‘(a) IN GENERAL.—

10 ‘‘(1) RENEWAL.—Subject to paragraph (2),

11 upon termination or expiration of a contract for

12 project-based assistance under section 8 for a multi13 family housing project (and notwithstanding section

14 8(v) of the United States Housing Act of 1937 for

15 loan management assistance), the Secretary shall, at

16 the request of the owner of the project and to the

17 extent sufficient amounts are made available in ap18 propriation Acts, use amounts available for the re19 newal of assistance under section 8 of such Act to

20 provide such assistance for the project. The assist21 ance shall be provided under a contract having such

22 terms and conditions as the Secretary considers ap23 propriate, subject to the requirements of this sec24 tion. This section shall not require contract renewal

25 for a project that is eligible under this subtitle for

26 a mortgage restructuring and rental assistance suffi-
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1 ciency plan, if there is no approved plan for the

2 project and the Secretary determines that such an

3 approved plan is necessary.

4 ‘‘(2) PROHIBITION ON RENEWAL.—Notwith5 standing part 24 of title 24 of the Code of Federal

6 Regulations, the Secretary may elect not to renew

7 assistance for a project otherwise required to be re8 newed under paragraph (1) or provide comparable

9 benefits under paragraph (1) or (2) of subsection (e)

10 for a project described in either such paragraph, if

11 the Secretary determines that a violation under

12 paragraph (1) through (4) of section 516(a) has oc13 curred with respect to the project. For purposes of

14 such a determination, the provisions of section 516

15 shall apply to a project under this section in the

16 same manner and to the same extent that the provi17 sions of such section apply to eligible multifamily

18 housing projects, except that the Secretary shall

19 make the determination under section 516(a)(4).

20 ‘‘(3) CONTRACT TERM FOR MARK-UP-TO-MAR21 KET CONTRACTS.—In the case of an expiring or ter22 minating contract that has rent levels less than com23 parable market rents for the market area, if the rent

24 levels under the renewal contract under this section

25 are equal to comparable market rents for the market
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1 area, the contract shall have a term of not less than

2 5 years, subject to the availability of sufficient

3 amounts in appropriation Acts.

4 ‘‘(4) RENEWAL RENTS.—Except as provided in

5 subsection (b), the contract for assistance shall pro6 vide assistance at the following rent levels:

7 ‘‘(A) MARKET RENTS.—At the request of

8 the owner of the project, at rent levels equal to

9 the lesser of comparable market rents for the

10 market area or 150 percent of the fair market

11 rents, in the case only of a project that—

12 ‘‘(i) has rent levels under the expiring

13 or terminating contract that do not exceed

14 such comparable market rents;

15 ‘‘(ii) does not have a low- and mod16 erate-income use restriction that can not

17 be eliminated by unilateral action by the

18 owner;

19 ‘‘(iii) is decent, safe, and sanitary

20 housing, as determined by the Secretary;

21 ‘‘(iv) is not—

22 ‘‘(I) owned by a nonprofit entity;

23 ‘‘(II) subject to a contract for

24 moderate rehabilitation assistance

25 under section 8(e)(2) of the United
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1 States Housing Act of 1937, as in ef2 fect before October 1, 1991; or

3 ‘‘(III) a project for which the

4 public housing agency provided vouch5 er assistance to one or more of the

6 tenants after the owner has provided

7 notice of termination of the contract

8 covering the tenant’s unit; and

9 ‘‘(v) has units assisted under the con10 tract for which the comparable market rent

11 exceeds 110 percent of the fair market

12 rent.

13 The Secretary may adjust the percentages of

14 fair market rent (as specified in the matter pre15 ceding clause (i) and in clause (v)), but only

16 upon a determination and written notification

17 to the Congress within 10 days of making such

18 determination, that such adjustment is nec19 essary to ensure that this subparagraph covers

20 projects with a high risk of nonrenewal of expir21 ing contracts for project-based assistance.

22 ‘‘(B) REDUCTION TO MARKET RENTS.—In

23 the case of a project that has rent levels under

24 the expiring or terminating contract that exceed

25 comparable market rents for the market area,
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1 at rent levels equal to such comparable market

2 rents.

3 ‘‘(C) RENTS NOT EXCEEDING MARKET

4 RENTS.—In the case of a project that is not

5 subject to subparagraph (A) or (B), at rent lev6 els that—

7 ‘‘(i) are not less than the existing

8 rents under the terminated or expiring

9 contract, as adjusted by an operating cost

10 adjustment factor established by the Sec11 retary (which shall not result in a negative

12 adjustment), if such adjusted rents do not

13 exceed comparable market rents for the

14 market area; and

15 ‘‘(ii) do not exceed comparable market

16 rents for the market area.

17 In determining the rent level for a contract

18 under this subparagraph, the Secretary shall

19 approve rents sufficient to cover budget-based

20 cost increases and shall give greater consider21 ation to providing rent at a level up to com22 parable market rents for the market area based

23 on the number of the criteria under clauses (i)

24 through (iv) of subparagraph (D) that the

25 project meets.
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1 ‘‘(D) WAIVER OF 150 PERCENT LIMITA2 TION.—Notwithstanding subparagraph (A), at

3 rent levels up to comparable market rents for

4 the market area, in the case of a project that

5 meets the requirements under clauses (i)

6 through (v) of subparagraph (A) and—

7 ‘‘(i) has residents who are a particu8 larly vulnerable population, as dem9 onstrated by a high percentage of units

10 being rented to elderly families, disabled

11 families, or large families;

12 ‘‘(ii) is located in an area in which

13 tenant-based assistance would be difficult

14 to use, as demonstrated by a low vacancy

15 rate for affordable housing, a high

16 turnback rate for vouchers, or a lack of

17 comparable rental housing;

18 ‘‘(iii) is a high priority for the local

19 community, as demonstrated by a con20 tribution of State or local funds to the

21 property; or

22 ‘‘(iv) is primarily occupied by elderly

23 or disabled families.

24 In determining the rent level for a contract

25 under this subparagraph, the Secretary shall
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1 approve rents sufficient to cover budget-based

2 cost increases and shall give greater consider3 ation to providing rent at a level up to com4 parable market rents for the market area based

5 on the number of the criteria under clauses (i)

6 through (iv) that the project meets.

7 ‘‘(5) COMPARABLE MARKET RENTS AND COM8 PARISON WITH FAIR MARKET RENTS.—The Sec9 retary shall prescribe the method for determining

10 comparable market rent by comparison with rents

11 charged for comparable properties (as such term is

12 defined in section 512), which may include appro13 priate adjustments for utility allowances and adjust14 ments to reflect the value of any subsidy (other than

15 section 8 assistance) provided by the Department of

16 Housing and Urban Development.

17 ‘‘(b) EXCEPTION RENTS.—

18 ‘‘(1) RENEWAL.—In the case of a multifamily

19 housing project described in paragraph (2), pursuant

20 to the request of the owner of the project, the con21 tract for assistance for the project pursuant to sub22 section (a) shall provide assistance at the lesser of

23 following rent levels:

24 ‘‘(A) ADJUSTED EXISTING RENTS.—The

25 existing rents under the expiring contract, as
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1 adjusted by an operating cost adjustment factor

2 established by the Secretary (which shall not re3 sult in a negative adjustment).

4 ‘‘(B) BUDGET-BASED RENTS.—Subject to

5 a determination by the Secretary that a rent

6 level under this subparagraph is appropriate for

7 a project, a rent level that provides income suf8 ficient to support a budget-based rent (includ9 ing a budget-based rent adjustment if justified

10 by reasonable and expected operating expenses).

11 ‘‘(2) PROJECTS COVERED.—A multifamily

12 housing project described in this paragraph is an

13 multifamily housing project that—

14 ‘‘(A) is not an eligible multifamily housing

15 project under section 512(2); or

16 ‘‘(B) is exempt from mortgage restruc17 turing under this subtitle pursuant to section

18 514(h).

19 ‘‘(c) RENT ADJUSTMENTS AFTER RENEWAL OF CON20 TRACT.—

21 ‘‘(1) REQUIRED.—After the initial renewal of a

22 contract for assistance under section 8 of the United

23 States Housing Act of 1937 pursuant to subsection

24 (a), (b), or (e)(2), the Secretary shall annually ad25 just the rents using an operating cost adjustment
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1 factor established by the Secretary (which shall not

2 result in a negative adjustment) or, upon the request

3 of the owner and subject to approval of the Sec4 retary, on a budget basis. In the case of projects

5 with contracts renewed pursuant to subsection (a) or

6 pursuant to subsection (e)(2) at rent levels equal to

7 comparable market rents for the market area, at the

8 expiration of each 5-year period, the Secretary shall

9 compare existing rents with comparable market

10 rents for the market area and may make any adjust11 ments in the rent necessary to maintain the contract

12 rents at a level not greater than comparable market

13 rents or to increase rents to comparable market

14 rents.

15 ‘‘(2) DISCRETIONARY.—In addition to review

16 and adjustment required under paragraph (1), in the

17 case of projects with contracts renewed pursuant to

18 subsection (a) or pursuant to subsection (e)(2) at

19 rent levels equal to comparable market rents for the

20 market area, the Secretary may, at the discretion of

21 the Secretary but only once within each 5-year pe22 riod referred to in paragraph (1), conduct a com23 parison of rents for a project and adjust the rents

24 accordingly to maintain the contract rents at a level
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1 not greater than comparable market rents or to in2 crease rents to comparable market rents.

3 ‘‘(d) ENHANCED VOUCHERS UPON CONTRACT EXPI4 RATION.—

5 ‘‘(1) IN GENERAL.—In the case of a contract

6 for project-based assistance under section 8 for a

7 covered project that is not renewed under subsection

8 (a) or (b) of this section (or any other authority),

9 to the extent that amounts for assistance under this

10 subsection are provided in advance in appropriation

11 Acts, upon the date of the expiration of such con12 tract the Secretary shall make enhanced voucher as13 sistance under this subsection available on behalf of

14 each low-income family who, upon the date of such

15 expiration, is residing in an assisted dwelling unit in

16 the covered project.

17 ‘‘(2) ENHANCED ASSISTANCE.—Enhanced

18 voucher assistance under this subsection for a family

19 shall be voucher assistance under section 8(o) of the

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

21 1437f(o)), except that under such enhanced voucher

22 assistance—

23 ‘‘(A) during any period that the assisted

24 family continues residing in the covered project

25 in which the family was residing on the date of
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1 the expiration of such contract and the rent for

2 the dwelling unit of the family in such project

3 exceeds the applicable payment standard estab4 lished pursuant to section 8(o) for the unit, the

5 amount of rental assistance provided on behalf

6 of the family shall be determined using a pay7 ment standard that is equal to the rent for the

8 dwelling unit (as such rent may be increased

9 from time to time), subject to paragraph

10 (10)(A) of such section 8(o); and

11 ‘‘(B) subparagraph (A) of this paragraph

12 shall not apply and the payment standard for

13 the dwelling unit occupied by the family shall be

14 determined in accordance with section 8(o) if—

15 ‘‘(i) the assisted family moves, at any

16 time, from such covered project; or

17 ‘‘(ii) the voucher is made available for

18 use by any family other than the original

19 family on behalf of whom the voucher was

20 provided pursuant to paragraph (1).

21 ‘‘(3) DEFINITIONS.—For purposes of this sub22 section, the following definitions shall apply:

23 ‘‘(A) ASSISTED DWELLING UNIT.—The

24 term ‘assisted dwelling unit’ means a dwelling

25 unit that—
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1 ‘‘(i) is in a covered project; and

2 ‘‘(ii) is covered by rental assistance

3 provided under the contract for project4 based assistance for the covered project.

5 ‘‘(B) COVERED PROJECT.—The term ‘cov6 ered project’ means any housing that—

7 ‘‘(i) consists of more than four dwell8 ing units;

9 ‘‘(ii) is covered in whole or in part by

10 a contract for project-based assistance

11 under—

12 ‘‘(I) the new construction or sub13 stantial rehabilitation program under

14 section 8(b)(2) of the United States

15 Housing Act of 1937 (as in effect be16 fore October 1, 1983);

17 ‘‘(II) the property disposition

18 program under section 8(b) of the

19 United States Housing Act of 1937;

20 ‘‘(III) the moderate rehabilitation

21 program under section 8(e)(2) of the

22 United States Housing Act of 1937

23 (as in effect before October 1, 1991);

24 ‘‘(IV) the loan management as25 sistance program under section 8 of
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1 the United States Housing Act of

2 1937;

3 ‘‘(V) section 23 of the United

4 States Housing Act of 1937 (as in ef5 fect before January 1, 1975);

6 ‘‘(VI) the rent supplement pro7 gram under section 101 of the Hous8 ing and Urban Development Act of

9 1965; or

10 ‘‘(VII) section 8 of the United

11 States Housing Act of 1937, following

12 conversion from assistance under sec13 tion 101 of the Housing and Urban

14 Development Act of 1965,

15 which contract will (under its own terms)

16 expire during the period consisting of fiscal

17 years 2000 through 2004; and

18 ‘‘(iii) is not housing for which resi19 dents are eligible for enhanced voucher as20 sistance as provided, pursuant to the ‘Pre21 serving Existing Housing Investment’ ac22 count in the Departments of Veterans Af23 fairs and Housing and Urban Develop24 ment, and Independent Agencies Appro25 priations Act, 1997 (Public Law 104–204;
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1 110 Stat. 2884) or any other subsequently

2 enacted provision of law, in lieu of any

3 benefits under section 223 of the Low-In4 come Housing Preservation and Resident

5 Homeownership Act of 1990 (12 U.S.C.

6 4113).

7 ‘‘(4) AUTHORIZATION OF APPROPRIATIONS.—

8 There are authorized to be appropriated for each of

9 fiscal years 2000, 2001, 2002, 2003, and 2004 such

10 sums as may be necessary for enhanced voucher as11 sistance under this subsection.

12 ‘‘(e) CONTRACTUAL COMMITMENTS UNDER PRESER13 VATION LAWS.—Except as provided in subsection (a)(2)

14 and notwithstanding any other provision of this subtitle,

15 the following shall apply:

16 ‘‘(1) PRESERVATION PROJECTS.—Upon expira17 tion of a contract for assistance under section 8 for

18 a project that is subject to an approved plan of ac19 tion under the Emergency Low Income Housing

20 Preservation Act of 1987 (12 U.S.C. 1715l note) or

21 the Low-Income Housing Preservation and Resident

22 Homeownership Act of 1990 (12 U.S.C. 4101 et

23 seq.), to the extent sufficient amounts are made

24 available in appropriation Acts, the Secretary shall

25 provide to the owner benefits comparable to those
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1 provided under such plan of action, including dis2 tributions, rent increase procedures, and duration of

3 low-income affordability restrictions. This paragraph

4 shall apply to projects with contracts expiring be5 fore, on, or after the date of the enactment of this

6 section.

7 ‘‘(2) DEMONSTRATION PROJECTS.—

8 ‘‘(A) IN GENERAL.—Upon expiration of a

9 contract for assistance under section 8 for a

10 project entered into pursuant to any authority

11 specified in subparagraph (B) for which the

12 Secretary determines that debt restructuring is

13 inappropriate, the Secretary shall, at the re14 quest of the owner of the project and to the ex15 tent sufficient amounts are made available in

16 appropriation Acts, provide benefits to the

17 owner comparable to those provided under such

18 contract, including annual distributions, rent

19 increase procedures, and duration of low-income

20 affordability restrictions. This paragraph shall

21 apply to projects with contracts expiring before,

22 on, or after the date of the enactment of this

23 section.
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1 ‘‘(B) DEMONSTRATION PROGRAMS.—The

2 authority specified in this subparagraph is the

3 authority under—

4 ‘‘(i) section 210 of the Departments

5 of Veterans Affairs and Housing and

6 Urban Development, and Independent

7 Agencies Appropriations Act, 1996 (Public

8 Law 104–134; 110 Stat. 1321–285; 42

9 U.S.C. 1437f note);

10 ‘‘(ii) section 212 of the Departments

11 of Veterans Affairs and Housing and

12 Urban Development, and Independent

13 Agencies Appropriations Act, 1997 (Public

14 Law 104–204; 110 Stat. 2897; 42 U.S.C.

15 1437f note); and

16 ‘‘(iii) either of such sections, pursuant

17 to any provision of this title.

18 ‘‘(f) PREEMPTION OF CONFLICTING STATE LAWS

19 LIMITING DISTRIBUTIONS.—No State or political subdivi20 sion of a State may establish, continue in effect, or enforce

21 any law or regulation that limits or restricts, to an amount

22 that is less than the amount provided for under the regula23 tions of the Secretary establishing allowable project dis24 tributions to provide a return on investment, the amount

25 of surplus funds accruing after the date of the enactment
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1 of this section that may be distributed from any project

2 assisted under a contract for rental assistance renewed

3 under any provision of this section to the owner of the

4 project. This subsection may not be construed to provide

5 for, allow, or result in the release or termination, for any

6 project, of any low- or moderate-income use restrictions

7 that can not be eliminated by unilateral action of the

8 owner of the project.

9 ‘‘(g) RULE OF CONSTRUCTION.—Expiring contracts

10 for moderate rehabilitation assistance under section

11 8(e)(2) of the United States Housing Act of 1937, as in

12 effect before October 1, 1991, shall be subject to renewal

13 under the provisions of this section and such renewal con14 tract may not be considered, construed, or administered

15 as providing moderate rehabilitation assistance under such

16 section 8(e)(2), except that the Secretary may provide

17 such assistance in a manner, and subject to such rules

18 and procedures, as the Secretary may designate. If the

19 owner of a project with such an expiring contract requests

20 renewal of the contract, the Secretary shall renew the ex21 piring contract, subject to the provisions of this section,

22 within 6 months of the date of such expiration, notwith23 standing whether any tenant-based rental assistance has

24 been provided to tenants of the project. This subsection
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1 shall apply to projects with contracts expiring before, on,

2 or after the date of the enactment of this section.

3 ‘‘(h) APPLICABILITY.—Except to the extent otherwise

4 specifically provided in this section, this section shall apply

5 with respect to any multifamily housing project having a

6 contract for project-based assistance under section 8 that

7 terminates or expires during fiscal year 2000 or there8 after.’’.

9 (b) DEFINITION OF ELIGIBLE MULTIFAMILY HOUS10 ING PROJECT.—Section 512(2) of the Multifamily As11 sisted Housing Reform and Affordability Act of 1997 (42

12 U.S.C. 1437f note) is amended by inserting after and

13 below subparagraph (C) the following:

14 ‘‘Such term does not include any project with an ex15 piring contract described in paragraph (1) or (2) of

16 section 524(e).’’.

17 (c) PROJECTS EXEMPTED FROM RESTRUCTURING

18 AGREEMENTS.—Section 514(h) of the Multifamily As19 sisted Housing Reform and Affordability Act of 1997 (42

20 U.S.C. 1437f note) is amended by inserting before the

21 semicolon at the end the following: ‘‘and the financing in22 volves mortgage insurance under the National Housing

23 Act, such that the implementation of a mortgage restruc24 turing and rental assistance sufficiency plan under this
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1 subtitle is in conflict with applicable law or agreements

2 governing such financing’’.

3 (d) CONFORMING AMENDMENTS.—Section 8 of the

4 United States Housing Act of 1937 (42 U.S.C. 1437f) is

5 amended—

6 (1) by designating as subsection (v) the sen7 tence added by section 405(c) of The Balanced

8 Budget Downpayment Act, I (Public Law 104–99;

9 110 Stat. 44); and

10 (2) by striking subsection (w).

11 SEC. 403. SECTION 236 ASSISTANCE.

12 (a) CONTINUED RECEIPT OF SUBSIDIES UPON REFI13 NANCING.—Section 236(e) of the National Housing Act

14 (12 U.S.C. 1715z–1(e)) is amended—

15 (1) by inserting ‘‘(1)’’ after ‘‘(e)’’; and

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

17 paragraph:

18 ‘‘(2) A project for which interest reduction payments

19 are made under this section and for which the mortgage

20 on the project has been refinanced shall continue to receive

21 the interest reduction payments under this section under

22 the terms of the contract for such payments, but only if

23 the project owner enters into such binding commitments

24 as the Secretary may require (which shall be applicable

25 to any subsequent owner) to ensure that the owner will
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1 continue to operate the project in accordance with all low2 income affordability restrictions for the project in connec3 tion with the Federal assistance for the project for a pe4 riod having a duration that is not less than the term for

5 which such interest reduction payments are made.’’.

6 (b) RETENTION OF EXCESS INCOME.—Section

7 236(g) of the National Housing Act (12 U.S.C. 1715z–

8 1(g)) is amended—

9 (1) by inserting ‘‘(1)’’ after ‘‘(g)’’;

10 (2) by striking the last sentence; and

11 (3) by adding at the end the following new

12 paragraphs:

13 ‘‘(2) Subject to paragraph (3) and notwithstanding

14 any other requirements of this subsection, a project owner

15 may retain some or all of such excess charges for project

16 use if authorized by the Secretary. Such use shall be for

17 project use and upon terms and conditions established by

18 the Secretary.

19 ‘‘(3) The authority under paragraph (2) to retain and

20 use excess charges shall apply—

21 ‘‘(A) during fiscal year 2000, to all project

22 owners collecting such excess charges; and

23 ‘‘(B) during fiscal year 2001 and

24 thereafter—
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1 ‘‘(i) to any owner of project with a

2 mortgage insured under this section, or a

3 project previously assisted under sub4 section (b) but without a mortgage insured

5 under this section if the project was in6 sured under section 207 of this Act before

7 July 30, 1998, pursuant to section 223(f)

8 of this Act and assisted under subsection

9 (b); and

10 ‘‘(ii) to other project owners not re11 ferred to in clause (i) who collect such ex12 cess charges, but only to the extent that

13 such retention and use is approved in ad14 vance in an appropriation Act.’’.

15 (c) PREVIOUSLY OWED EXCESS INCOME.—Section

16 236(g) of the National Housing Act (12 U.S.C. 1715z–

17 1(g)), as amended by subsection (b) of this section, is fur18 ther amended by adding at the end the following new para19 graph:

20 ‘‘(4) The Secretary shall not withhold approval of the

21 retention by the owner of such excess charges because of

22 the existence of unpaid excess charges if such unpaid

23 amount is being remitted to the Secretary over a period

24 of time in accordance with a workout agreement with the
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1 Secretary, unless the Secretary determines that the owner

2 is in violation of the workout agreement.’’.

3 (d) FLEXIBILITY REGARDING BASIC RENTS AND

4 MARKET RENTS.—Section 236(f) of the National Housing

5 Act (12 U.S.C. 1715z–1(f)(1)) is amended by striking the

6 subsection designation and all that follows through the

7 end of paragraph (1) and inserting the following:

8 ‘‘(f)(1)(A)(i) For each dwelling unit there shall be es9 tablished, with the approval of the Secretary, a basic rent10 al charge and fair market rental charge.

11 ‘‘(ii) The basic rental charge shall be—

12 ‘‘(I) the amount needed to operate the project

13 with payments of principal and interest due under a

14 mortgage bearing interest at the rate of 1 percent

15 per annum; or

16 ‘‘(II) an amount greater than that determined

17 under clause (ii)(I), but not greater than the market

18 rent for a comparable unassisted unit, reduced by

19 the value of the interest reduction payments subsidy.

20 ‘‘(iii) The fair market rental charge shall be—

21 ‘‘(I) the amount needed to operate the project

22 with payments of principal, interest, and mortgage

23 insurance premium which the mortgagor is obligated

24 to pay under the mortgage covering the project; or
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1 ‘‘(II) an amount greater than that determined

2 under clause (iii)(I), but not greater than the mar3 ket rent for a comparable unassisted unit.

4 ‘‘(iv) The Secretary may approve a basic rental

5 charge and fair market rental charge for a unit that ex6 ceeds the minimum amounts permitted by this subpara7 graph for such charges only if—

8 ‘‘(I) the approved basic rental charge and fair

9 market rental charges each exceed the applicable

10 minimum charge by the same amount; and

11 ‘‘(II) the project owner agrees to restrictions on

12 project use or mortgage prepayment that are accept13 able to the Secretary.

14 ‘‘(v) The Secretary may approve a basic rental charge

15 and fair market rental charge under this paragraph for

16 a unit with assistance under section 8 of the United States

17 Housing Act of 1937 (42 U.S.C. 1437f) that differs from

18 the basic rental charge and fair market rental charge for

19 a unit in the same project that is similar in size and amen20 ities but without such assistance, as needed to ensure equi21 table treatment of tenants in units without such assist22 ance.

23 ‘‘(B)(i) The rental charge for each dwelling unit shall

24 be at the basic rental charge or such greater amount, not

25 exceeding the fair market rental charge determined pursu-
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1 ant to subparagraph (A), as represents 30 percent of the

2 tenant’s adjusted income, except as otherwise provided in

3 this subparagraph.

4 ‘‘(ii) In the case of a project which contains more

5 than 5000 units, is subject to an interest reduction pay6 ments contract, and is financed under a State or local

7 project, the Secretary may reduce the rental charge ceil8 ing, but in no case shall the rental charge be below the

9 basic rental charge set forth in subparagraph (A)(ii)(I).

10 ‘‘(iii) For plans of action approved for capital grants

11 under the Low-Income Housing Preservation and Resi12 dent Homeownership Act of 1990 or the Emergency Low

13 Income Housing Preservation Act of 1987, the rental

14 charge for each dwelling unit shall be at the minimum

15 basic rental charge set forth in subparagraph (A)(ii)(I) or

16 such greater amount, not exceeding the lower of (I) the

17 fair market rental charge set forth in subparagraph

18 (A)(iii)(I), or (II) the actual rent paid for a comparable

19 unit in comparable unassisted housing in the market area

20 in which the housing assisted under this section is located,

21 as represents 30 percent of the tenant’s adjusted income.

22 ‘‘(C) With respect to those projects which the Sec23 retary determines have separate utility metering paid by

24 the tenants for some or all dwelling units, the Secretary

25 may—
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1 ‘‘(i) permit the basic rental charge and the fair

2 market rental charge to be determined on the basis

3 of operating the project without the payment of the

4 cost of utility services used by such dwelling units;

5 and

6 ‘‘(ii) permit the charging of a rental for such

7 dwelling units at such an amount less than 30 per8 cent of a tenant’s adjusted income as the Secretary

9 determines represents a proportionate decrease for

10 the utility charges to be paid by such tenant, but in

11 no case shall rental be lower than 25 percent of a

12 tenant’s adjusted income.’’.

13 (e) EFFECTIVE DATE OF 1998 PROVISIONS.—Sec14 tion 236(g) of the National Housing Act (12 U.S.C.

15 1715z–1(g)), as amended by section 227 of the Depart16 ments of Veterans Affairs and Housing and Urban Devel17 opment, and Independent Agencies Appropriations Act,

18 1999 (Public Law 105–276; 112 Stat. 2490) shall be ef19 fective on the date of the enactment of such Public Law

20 105–276, and any excess rental charges referred to in

21 such section that have been collected since such date of

22 enactment with respect to projects with mortgages insured

23 under section 207 of the National Housing Act (12 U.S.C.

24 1713) may be retained by the project owner unless the

25 Secretary of Housing and Urban Development specifically
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1 provides otherwise. The Secretary may return any excess

2 charges remitted to the Secretary since such date of the

3 enactment.

4 (f) EFFECTIVE DATE.—This section shall take effect,

5 and the amendments made by this section are made and

6 shall apply, on the date of the enactment of this Act.

7 SEC. 404. MATCHING GRANT PROGRAM FOR AFFORDABLE

8 HOUSING PRESERVATION.

9 (a) AMENDMENT TO LOW-INCOME HOUSING PRES10 ERVATION AND RESIDENT HOMEOWNERSHIP ACT OF

11 1990.—Title II of the Housing and Community Develop12 ment Act of 1987 (12 U.S.C. 4101 et seq.) is amended—

13 (1) by striking subtitles C and D (as enacted by

14 Public Law 100–242; 101 Stat. 1886); and

15 (2) by adding at the end the following new sub16 title:

17 ‘‘Subtitle D—Matching Grants for

18 States

19 ‘‘SEC. 261. AUTHORITY.

20 ‘‘The Secretary of Housing and Urban Development

21 shall, to the extent amounts are made available pursuant

22 to section 269, make grants under this subtitle to States

23 and qualified units of general local government for low24 income housing preservation.
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1 ‘‘SEC. 262. USE OF GRANTS.

2 ‘‘(a) IN GENERAL.—Amounts from grants under this

3 subtitle may be used only for assistance for acquisition,

4 preservation incentives, operating costs, and capital ex5 penditures for a housing project that—

6 ‘‘(1) is at risk of loss for use as affordable

7 housing;

8 ‘‘(2)(A) is primarily occupied by elderly or dis9 abled families;

10 ‘‘(B) contains one or more dwelling units with

11 three or more bedrooms that are occupied by large

12 families;

13 ‘‘(C) is located in a rural area with an inad14 equate supply of comparable housing, as determined

15 by the Secretary; or

16 ‘‘(D) is located in a neighborhood or area—

17 ‘‘(i) that is geographically smaller

18 than a market area; and

19 ‘‘(ii) within which, in the determina20 tion of the Secretary, rental assistance

21 vouchers would be difficult to use, as dem22 onstrated by a low vacancy rate for afford23 able housing, a high turnback rate for such

24 vouchers, or a lack of comparable rental

25 housing;
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1 ‘‘(3) meets the requirements under subsection

2 (b), (c), or (d); and

3 ‘‘(4) is subject to such binding commitments as

4 the Secretary shall require (which shall be applicable

5 to any subsequent owner) to ensure that the low-in6 come affordability restrictions for the project in con7 nection with Federal assistance for the project have

8 been extended for the full period applicable under

9 the terms of assistance for the project, but in no

10 case for a period shorter than 5 years.

11 ‘‘(b) PROJECTS WITH FEDERALLY ASSISTED MORT12 GAGES.—A project meets the requirements under this sub13 section only if—

14 ‘‘(1) the project is financed by a loan or mort15 gage that is—

16 ‘‘(A) insured or held by the Secretary

17 under section 221(d)(3) of the National Hous18 ing Act and receiving loan management assist19 ance under section 8 of the United States

20 Housing Act of 1937 due to a conversion from

21 section 101 of the Housing and Urban Develop22 ment Act of 1965;

23 ‘‘(B) insured or held by the Secretary and

24 bears interest at a rate determined under the
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1 proviso of section 221(d)(5) of the National

2 Housing Act;

3 ‘‘(C) insured, assisted, or held by the Sec4 retary or a State or State agency under section

5 236 of the National Housing Act;

6 ‘‘(D) held by the Secretary and formerly

7 insured under a program referred to in sub8 paragraph (A), (B), or (C); or

9 ‘‘(E) insured or held by the Secretary of

10 Agriculture under section 514 or 515 of the

11 Housing Act of 1949; and

12 ‘‘(2) the project is subject to an unconditional

13 waiver of, with respect to the remaining term of the

14 mortgage referred to in paragraph (1)—

15 ‘‘(A) all rights to any prepayment of the

16 mortgage; and

17 ‘‘(B) all rights to any voluntary termi18 nation of the mortgage insurance contract for

19 the mortgage or the interest reduction pay20 ments contract, as applicable,

21 except that such requirement shall not apply in the

22 case of a project that is subject to a binding agree23 ment that ensures that the project will continue to

24 operate, at least until the maturity date of the loan

25 or mortgage, in a manner that will provide rental
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1 housing on terms at least as advantageous to exist2 ing and future tenants as the terms required by the

3 program under which the loan or mortgage was

4 made or insured prior to the proposed prepayment

5 or termination.

6 ‘‘(c) PROJECTS WITH SECTION 8 PROJECT-BASED

7 ASSISTANCE.—A project meets the requirements under

8 this subsection only if—

9 ‘‘(1) the project is subject to a contract for

10 project-based assistance; and

11 ‘‘(2) the owner of the project has entered into

12 binding commitments (applicable to any subsequent

13 owner) to extend such assistance (subject to the

14 availability of amounts for such purpose) for a min15 imum of 5 years, or longer, as the Secretary may

16 prescribe under this section.

17 ‘‘(d) PROJECTS PURCHASED BY RESIDENTS.—A

18 project meets the requirements under this subsection only

19 if the project—

20 ‘‘(1) is or was eligible low-income housing (as

21 such term is defined in section 229 (42 U.S.C.

22 4119)); and

23 ‘‘(2) has been purchased by a resident council

24 for the housing or is approved by the Secretary for

25 such purchase, for conversion to homeownership
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1 housing under a resident homeownership program

2 meeting the requirements under section 226 (12

3 U.S.C. 4116).

4 ‘‘(e) COMBINATION OF ASSISTANCE.—Notwith5 standing subsection (a), any project that is otherwise eligi6 ble for assistance with grant amounts provided under this

7 subtitle because the project meets the requirements under

8 subsection (b) or (c) and that also meets the requirements

9 under paragraph (1) of the other of such subsections, shall

10 be eligible for such assistance only if the project complies

11 with all of the requirements under such other subsection.

12 ‘‘SEC. 263. GRANT AMOUNT LIMITATION.

13 ‘‘The Secretary shall limit the portion of the aggre14 gate amount of grants under this subtitle made available

15 for any fiscal year that may be provided to a single State

16 or qualified unit of general local government based upon

17 the proportion of such State’s or unit’s need (as deter18 mined by the Secretary) for such assistance to the aggre19 gate need among all States and qualified units of general

20 local government approved for such assistance for such fis21 cal year.

22 ‘‘SEC. 264. MATCHING REQUIREMENT.

23 ‘‘(a) IN GENERAL.—The Secretary may not make a

24 grant under this subtitle to any State or qualified unit
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1 of general local government for any fiscal year in a total

2 amount that exceeds the sum of the following amounts:

3 ‘‘(1) 100 percent of the amount that the State

4 or qualified unit of general local government cer5 tifies, as the Secretary shall require, that the State

6 or qualified unit will contribute for such fiscal year,

7 or has contributed since January 1, 1999, for the

8 purposes under section 262(a).

9 ‘‘(2) 50 percent of the amount that the State

10 or qualified unit of general local government certifies

11 will be or have been so contributed from Federal

12 sources.

13 ‘‘(b) TREATMENT OF PREVIOUS CONTRIBUTIONS.—

14 Any portion of amounts contributed after January 1,

15 1999, that are counted for purposes of meeting the appli16 cable requirement under subsection (a) for a fiscal year

17 may not be counted for such purposes for any subsequent

18 fiscal year.

19 ‘‘(c) TREATMENT OF TAX CREDITS.—Tax credits

20 provided under section 42 of the Internal Revenue Code

21 of 1986 and proceeds from the sale of tax-exempt revenue

22 bonds, by any State, county, or local government entity,

23 which are subject to volume limitation under Federal law,

24 shall not be considered non-Federal sources for purposes

25 of this section.
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1 ‘‘SEC. 265. TREATMENT OF SUBSIDY LAYERING REQUIRE2 MENTS.

3 ‘‘Neither section 264 nor any other provision of this

4 subtitle may be construed to prevent the use of tax credits

5 provided under section 42 of the Internal Revenue Code

6 of 1986 in connection with housing assisted with grant

7 amounts provided under this subtitle, to the extent that

8 such use is in accordance with section 102(d) of the De9 partment of Housing and Urban Development Reform Act

10 of 1989 (42 U.S.C. 3545(d)) and section 911 of the Hous11 ing and Community Development Act of 1992 (42 U.S.C.

12 3545 note).

13 ‘‘SEC. 266. APPLICATIONS AND PREFERENCE.

14 ‘‘(a) APPLICATIONS.—The Secretary shall provide for

15 States and units of general local government (through ap16 propriate State and local government agencies, including

17 State and local housing finance agencies) to submit appli18 cations for grants under this subtitle. The Secretary shall

19 require the applications to contain any information and

20 certifications necessary for the Secretary to determine

21 whether the State or unit of general local government is

22 eligible to receive such a grant.

23 ‘‘(b) PREFERENCE.—In making grants under this

24 subtitle during fiscal years 2001 and thereafter, the Sec25 retary shall give preference—
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1 ‘‘(1) among applications otherwise having equal

2 merit for funding under this subtitle, to funding ap3 plications for eligible States, and qualified units of

4 general local government located in States, that have

5 not previously received a grant under this subtitle;

6 and

7 ‘‘(2) to grants for eligible housing projects that

8 are subject to such binding commitments as the Sec9 retary may require to ensure that the project will be

10 sold or transferred to an owner that is a nonprofit

11 organization.

12 ‘‘SEC. 267. DEFINITIONS.

13 ‘‘For purposes of this subtitle, the following defini14 tions shall apply:

15 ‘‘(1) LOW-INCOME AFFORDABILITY RESTRIC16 TIONS.—The term ‘low-income affordability restric17 tions’ has the meaning given such term in section

18 229.

19 ‘‘(2) PROJECT-BASED ASSISTANCE.—The term

20 ‘project-based assistance’ has the meaning given

21 such term in section 16(c) of the United States

22 Housing Act of 1937 (42 U.S.C. 1437n(c)), except

23 that such term includes assistance under any suc24 cessor programs to the programs referred to in such

25 section.
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1 ‘‘(3) QUALIFIED UNIT OF GENERAL LOCAL GOV2 ERNMENT.—The term ‘qualified unit of general local

3 government’ means, with respect to a fiscal year, a

4 unit of general local government that is located with5 in a State that—

6 ‘‘(A) has not applied, and has indicated (in

7 accordance with such requirements as the Sec8 retary shall establish) that it will not apply, to

9 the Secretary for a grant under this subtitle for

10 the fiscal year; or

11 ‘‘(B) has been determined by the Secretary

12 not to be eligible for a grant under this subtitle

13 for the fiscal year.

14 ‘‘(4) SECRETARY.—The term ‘Secretary’ means

15 the Secretary of Housing and Urban Development.

16 ‘‘(5) STATE.—The term ‘State’ means the

17 States of the United States, the District of Colum18 bia, the Commonwealth of Puerto Rico, the Com19 monwealth of the Northern Mariana Islands, Guam,

20 the Virgin Islands, American Samoa, and any other

21 territory or possession of the United States.

22 ‘‘(6) UNIT OF GENERAL LOCAL GOVERN23 MENT.—The term ‘unit of general local government’

24 has the meaning given such term in section 102 of
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1 the Housing and Community Development Act of

2 1974 (42 U.S.C. 5302).

3 ‘‘SEC. 268. REGULATIONS.

4 ‘‘The Secretary may issue any regulations necessary

5 to carry out this subtitle.

6 ‘‘SEC. 269. AUTHORIZATION OF APPROPRIATIONS.

7 ‘‘There are authorized to be appropriated for grants

8 under this subtitle such sums as may be necessary for each

9 of fiscal years, 2000, 2001, and 2002.’’.

10 (b) RULE OF CONSTRUCTION.—The amendment

11 made by subsection (a)(1) of this section (relating to strik12 ing subtitles C and D of title II of the Housing and Com13 munity Development Act of 1987) may not be construed

14 to repeal or otherwise affect any provision of law that was

15 amended by such subtitles.

16 SEC. 405. REHABILITATION OF ASSISTED HOUSING.

17 (a) REHABILITATION LOANS FROM RECAPTURED

18 IRP AMOUNTS.—Section 236(s) of the National Housing

19 Act (12 U.S.C. 1715z–1) is amended—

20 (1) by striking the subsection designation and

21 heading and inserting the following:

22 ‘‘(s) GRANTS AND LOANS FOR REHABILITATION OF

23 MULTIFAMILY PROJECTS.—’’;

24 (2) in paragraph (1), by inserting ‘‘and loans’’

25 after ‘‘grants’’;
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1 (3) in paragraph (2)—

2 (A) in the matter preceding subparagraph

3 (A), by striking ‘‘capital grant assistance under

4 this subsection’’ and inserting ‘‘capital assist5 ance under this subsection under a grant or

6 loan only’’; and

7 (B) in subparagraph (D)(i), by striking

8 ‘‘capital grant assistance’’ and inserting ‘‘cap9 ital assistance under this subsection from a

10 grant or loan (as appropriate)’’;

11 (4) in paragraph (3), by striking all of the mat12 ter that precedes subparagraph (A) and inserting

13 the following:

14 ‘‘(3) ELIGIBLE USES.—Amounts from a grant

15 or loan under this subsection may be used only for

16 projects eligible under paragraph (2) for the pur17 poses of—’’;

18 (5) in paragraph (4)—

19 (A) by striking the paragraph heading and

20 inserting ‘‘GRANT AND LOAN AGREEMENTS’’;

21 and

22 (B) by inserting ‘‘or loan’’ after ‘‘grant’’,

23 each place it appears;

24 (6) in paragraph (5), by inserting ‘‘or loan’’

25 after ‘‘grant’’, each place it appears;
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1 (7) in paragraph (6), as amended by the pre2 ceding provisions of this Act, by adding at the end

3 the following new subparagraph:

4 ‘‘(D) LOANS.—In making loans under this

5 subsection using the amounts that the Sec6 retary has recaptured from contracts for inter7 est reduction payments pursuant to clause (i)

8 or (ii) of paragraph (7)(A)—

9 ‘‘(i) the Secretary may use such re10 captured amounts for costs (as such term

11 is defined in section 502 of the Congres12 sional Budget Act of 1974) of such loans;

13 ‘‘(ii) the Secretary may make loans in

14 any fiscal year only to the extent or in

15 such amounts that amounts are used

16 under clause (i) to cover costs of such

17 loans; and

18 ‘‘(iii) the authority of the Secretary to

19 enter into commitments to make such

20 loans shall be effective for any fiscal year

21 only to the extent that: (I) there is enacted

22 in advance, in an appropriations Act, a

23 maximum limitation on the aggregate prin24 cipal amount of such commitments for

25 such fiscal year; and (II) the aggregate
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1 principal amount of such commitments en2 tered into by the Secretary does not exceed

3 such maximum amount.’’;

4 (8) by redesignating paragraphs (5) and (6) (as

5 amended by the preceding provisions of this sub6 section) as paragraphs (6) and (7); and

7 (9) by inserting after paragraph (4) the fol8 lowing new paragraph:

9 ‘‘(5) LOAN TERMS.—A loan under this

10 subsection—

11 ‘‘(A) shall provide amounts for the eligible

12 uses under paragraph (3) in a single loan dis13 bursement of loan principal;

14 ‘‘(B) shall be repaid, as to principal and

15 interest, on behalf of the borrower using

16 amounts recaptured from contracts for interest

17 reduction payments pursuant to clause (i) or

18 (ii) of paragraph (7)(A);

19 ‘‘(C) shall have a term to maturity of a du20 ration not shorter than the remaining period for

21 which the interest reduction payments for the

22 insured mortgage or mortgages that fund re23 payment of the loan would have continued after

24 extinguishment or writedown of the mortgage

25 (in accordance with the terms of such mortgage
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1 in effect immediately before such extinguish2 ment or writedown);

3 ‘‘(D) shall bear interest at a rate, as deter4 mined by the Secretary of the Treasury, that is

5 based upon the current market yields on out6 standing marketable obligations of the United

7 States having comparable maturities; and

8 ‘‘(E) shall involve a principal obligation of

9 an amount not exceeding the amount that can

10 be repaid using amounts described in subpara11 graph (B) over the term determined in accord12 ance with subparagraph (C), with interest at

13 the rate determined under subparagraph (D).’’.

14 (b) ELIGIBILITY OF NONINSURED PROJECTS FOR

15 IRP CAPITAL GRANTS.—Section 236(s)(2) of the Na16 tional Housing Act (12 U.S.C. 1715z–1(s)(2)(A)) is

17 amended by striking subparagraph (A) and inserting the

18 following new subparagraph:

19 ‘‘(A) if the project is federally assisted

20 housing described in subparagraph (B), (C),

21 (D), (E), (F) or (G) of section 683(2) of the

22 Housing and Community Development Act of

23 1992 (42 U.S.C. 13641(2));’’.

24 (c) IRP CAPITAL GRANTS REQUIREMENT FOR EX25 TENSION OF LOW-INCOME AFFORDABILITY REQUIRE-
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1 MENTS.—Section 236(s) of the National Housing Act (12

2 U.S.C. 1715z–1(s)) is amended—

3 (1) in paragraph (2)—

4 (A) by redesignating subparagraphs (C)

5 and (D), as amended by the preceding provi6 sions of this section, as subparagraphs (D) and

7 (E), respectively; and

8 (B) by inserting after subparagraph (B)

9 the following new subparagraph:

10 ‘‘(C) the project owner enters into such

11 binding commitments as the Secretary may re12 quire (which shall be applicable to any subse13 quent owner) to ensure that the owner will con14 tinue to operate the project in accordance with

15 all low-income affordability restrictions for the

16 project in connection with the Federal assist17 ance for the project for a period having a dura18 tion that is not less than the period referred to

19 in paragraph (5)(C);’’; and

20 (2) in paragraph (4)(B), by inserting ‘‘and con21 sistent with paragraph (2)(C)’’ before the period at

22 the end.

23 SEC. 406. TECHNICAL ASSISTANCE.

24 Section 514(f)(3) of the Multifamily Assisted Hous25 ing Reform and Affordability Act of 1997 (42 U.S.C.
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1 1437f note) is amended by inserting after ‘‘new owners)’’

2 the following: ‘‘, for technical assistance for preservation

3 of low-income housing for which project-based rental as4 sistance is provided at below market rent levels and may

5 not be renewed (including transfer of developments to ten6 ant groups, nonprofit organizations, and public entities),’’.

7 SEC. 407. TERMINATION OF SECTION 8 CONTRACT AND DU8 RATION OF RENEWAL CONTRACT.

9 Section 8(c)(8) of the United States Housing Act of

10 1937 (42 U.S.C. 1437f(c)(8)) is amended—

11 (1) in subparagraph (A)—

12 (A) by striking ‘‘terminating’’ and insert13 ing ‘‘termination of’’; and

14 (B) by striking the third comma of the

15 first sentence and all that follows through the

16 end of the subparagraph and inserting the fol17 lowing: ‘‘. The notice shall also include a state18 ment that, if the Congress makes funds avail19 able, the owner and the Secretary may agree to

20 a renewal of the contract, thus avoiding termi21 nation, and that in the event of termination the

22 Department of Housing and Urban Develop23 ment will provide tenant-based rental assistance

24 to all eligible residents, enabling them to choose

25 the place they wish to rent, which is likely to
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1 include the dwelling unit in which they cur2 rently reside. Any contract covered by this

3 paragraph that is renewed may be renewed for

4 a period of up to one year or any number or

5 years, with payments subject to the availability

6 of appropriations for any year.’’;

7 (2) by striking subparagraph (B);

8 (3) in subparagraph (C)—

9 (A) by striking the first sentence;

10 (B) by striking ‘‘in the immediately pre11 ceding sentence’’;

12 (C) by striking ‘‘180-day’’ each place it ap13 pears;

14 (D) by striking ‘‘such period’’ and insert15 ing ‘‘one year’’; and

16 (E) by striking ‘‘180 days’’ and inserting

17 ‘‘one year’’; and

18 (4) by redesignating subparagraphs (C), (D),

19 and (E), as amended by the preceding provisions of

20 this subsection, as subparagraphs (B), (C), and (D),

21 respectively.

22 SEC. 408. ENHANCED VOUCHER ELIGIBILITY AND BENE23 FITS.

24 (a) ELIGIBILITY OF RESIDENTS OF FLEXIBLE SUB25 SIDY PROJECTS.—Section 201 of the Housing and Com-
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1 munity Development Amendments of 1978 (12 U.S.C.

2 1715z–1a) is amended by adding at the end the following

3 new subsection:

4 ‘‘(p) ENHANCED VOUCHER ELIGIBILITY.—Notwith5 standing any other provision of law, any project that re6 ceives or has received assistance under this section and

7 which is the subject of a transaction under which the

8 project is preserved as affordable housing, as determined

9 by the Secretary, shall be considered eligible low-income

10 housing under section 229 of the Low-Income Housing

11 Preservation and Resident Homeownership Act of 1990

12 (12 U.S.C. 4119) for purposes of eligibility of residents

13 of such project for enhanced voucher assistance provided

14 in accordance with the ‘Preserving Existing Housing In15 vestment’ account in the Departments of Veterans Affairs

16 and Housing and Urban Development, and Independent

17 Agencies Appropriations Act, 1997 (Public Law 104–204;

18 110 Stat. 2884) and pursuant to such provision or any

19 other subsequently enacted provision of law.’’.

20 (b) EFFECT OF RENTAL INCREASES ON OTHER EN21 HANCED VOUCHERS.—To the extent that amounts are

22 provided in advance in appropriations Acts for enhanced

23 vouchers (including amendments and renewals) pursuant

24 to the authority under the heading ‘‘Preserving Existing

25 Housing Investment’’ in the Departments of Veterans Af-
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1 fairs and Housing and Urban Development, and Inde2 pendent Agencies Appropriations Act, 1997 (Public Law

3 104–204; 110 Stat. 2884), each family receiving such en4 hanced voucher assistance after the date of prepayment

5 or voluntary termination which continues to reside in the

6 housing occupied on the date of prepayment or voluntary

7 termination and the rent of which, absent enhanced vouch8 er assistance, would exceed the greater of 30 percent of

9 adjusted income or the rent paid by the family on such

10 date, may continue to receive such enhanced voucher as11 sistance indefinitely, subject to other requirements of that

12 authority, as amended: Provided, That rent resulting from

13 rent increases occurring later than 1 year after the date

14 of prepayment or voluntary termination may be used to

15 increase the applicable payment standard: Provided fur16 ther, That the rent for the dwelling unit is reasonable in

17 comparison to the rent charged for comparable dwelling

18 units in the private, unassisted local market.

19 SEC. 409. ENHANCED DISPOSITION AUTHORITY.

20 Section 204 of the Departments of Veterans Affairs

21 and Housing and Urban Development, and Independent

22 Agencies Appropriations Act, 1997 (12 U.S.C. 1715z–

23 11a) is amended—

24 (1) by striking ‘‘and 1999’’ and inserting

25 ‘‘1999, and 2000’’; and
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1 (2) by striking ‘‘or demolition’’ and inserting ‘‘,

2 demolition, or construction on the properties (which

3 shall be eligible whether vacant or occupied)’’.

4 SEC. 410. ASSISTANCE FOR NONPROFIT PURCHASERS PRE5 SERVING AFFORDABLE HOUSING.

6 (a) CONGRESSIONAL FINDINGS.—The Congress finds

7 that—

8 (1) a substantial number of existing federally

9 assisted or federally insured multifamily properties

10 are at risk of being lost from the affordable housing

11 inventory of the Nation through market rate conver12 sion, deterioration, or demolition;

13 (2) it is in the interests of the Nation to en14 courage transfer of control of such properties to

15 competent national, regional, and local nonprofit en16 tities and intermediaries whose missions involve

17 maintaining the affordability of such properties;

18 (3) such transfers may be inhibited by a short19 age of such entities that are appropriately capital20 ized; and

21 (4) the Nation would be well served by pro22 viding assistance to such entities to aid in accom23 plishing this purpose.

24 (b) GRANTS.—The Secretary of Housing and Urban

25 Development may make grants, to the extent amounts are
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1 made available for such grants, to eligible entities under

2 subsection (c) for use only for operational, working cap3 ital, and organizational expenses of such entities and ac4 tivities by such entities to acquire eligible affordable hous5 ing for the purpose of ensuring that the housing will re6 main affordable, as the Secretary considers appropriate,

7 for low-income or very low-income families (including el8 derly persons).

9 (c) ELIGIBLE ENTITIES.—The Secretary shall estab10 lish standards for eligible entities under this subsection,

11 which shall include requirements that to be considered an

12 eligible entity for purposes of this section an entity shall—

13 (1) be a nonprofit organization (as such term is

14 defined in 104 of the Cranston-Gonzalez National

15 Affordable Housing Act);

16 (2) have among its purposes maintaining the

17 affordability to low-income or very low-income fami18 lies of multifamily properties that are at risk of loss

19 from the inventory of housing that is affordable to

20 low-income or very low-income families; and

21 (3) demonstrate need for assistance under this

22 section for the purposes under subsection (b), expe23 rience in carrying out activities referred to in such

24 subsection, and capability to carry out such activi25 ties.
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1 (d) DEFINITIONS.—For purposes of this section, the

2 following definitions shall apply:

3 (1) ELIGIBLE AFFORDABLE HOUSING.—The

4 term ‘‘eligible affordable housing’’ means housing

5 that—

6 (A) consists of more than four dwelling

7 units;

8 (B) is insured or assisted under a program

9 of the Department of Housing and Urban De10 velopment or the Department of Agriculture

11 under which the property is subject to limita12 tions on tenant rents, rent contributions, or in13 comes; and

14 (C) is at risk, as determined by the Sec15 retary, of termination of any of the limitations

16 referred to in subparagraph (B).

17 (2) LOW-INCOME FAMILIES; VERY LOW-INCOME

18 FAMILIES.—The terms ‘‘low-income families’’ and

19 very low-income families’’ have the meanings given

20 such terms in section 3(b) of the United States

21 Housing Act of 1937.

22 (e) AUTHORIZATION OF APPROPRIATIONS.—There

23 are authorized to be appropriated for grants under this

24 section such sums as may be necessary for each of fiscal

25 years 2000, 2001, and 2002.
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1 TITLE V—MORTGAGE INSUR2 ANCE FOR HEALTH CARE FA3 CILITIES AND HOME EQUITY

4 CONVERSION MORTGAGES

5 SEC. 501. REHABILITATION OF EXISTING HOSPITALS, NURS6 ING HOMES, AND OTHER FACILITIES.

7 Section 223(f) of the National Housing Act (12

8 U.S.C. 1715n(f)) is amended—

9 (1) in paragraph (1), by inserting ‘‘existing

10 health care facility,’’ after ‘‘existing board and care

11 home,’’; and

12 (2) in paragraph (4)—

13 (A) by inserting ‘‘existing health care facil14 ity,’’ after ‘‘board and care home,’’ each place

15 it appears;

16 (B) in subparagraph (A), by inserting be17 fore the semicolon at the end the following: ‘‘,

18 which refinancing, in the case of a loan on a

19 hospital, home, or facility that is within 5 years

20 of maturity, shall include a mortgage made to

21 prepay such loan;’’;

22 (C) in subparagraph (B), by inserting after

23 ‘‘indebtedness’’ the following: ‘‘, pay the costs

24 of any repairs, maintenance, improvements, or
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1 additional equipment which may be approved by

2 the Secretary,’’; and

3 (D) in subparagraph (D)—

4 (i) by inserting ‘‘existing’’ before ‘‘in5 termediate care facility’’; and

6 (ii) by inserting ‘‘existing’’ before

7 ‘‘board and care home’’.

8 SEC. 502. NEW HEALTH CARE FACILITIES.

9 Section 232 of the National Housing Act (12 U.S.C.

10 1715w) is amended—

11 (1) in subsection (a), by adding at the end the

12 following new paragraph:

13 ‘‘(4) The development of health care facilities

14 for the care and treatment of the elderly and other

15 persons in need of health care and related services,

16 but who are not acutely ill and do not require hos17 pital care, and the support of health care facilities

18 which provide such health care and related services

19 (including those which support hospitals, as defined

20 in section 242(b)).’’;

21 (2) in subsection (b)—

22 (A) in paragraph (4), by inserting after

23 the first period the following new sentence:

24 ‘‘Such term includes a parity first mortgage or
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1 parity first deed of trust, subject to such terms

2 and conditions as the Secretary may provide.’’;

3 (B) in paragraph (6)—

4 (i) by striking subparagraph (A) and

5 inserting the following new subparagraph:

6 ‘‘(A) meets all licensing and regulatory re7 quirements of the State, or if there is no State

8 law providing for such licensing and regulation

9 by the State, meets all licensing and regulatory

10 requirements of the municipality or other polit11 ical subdivision in which the facility is located,

12 or, in the absence of any such requirements,

13 meets any requirements of the Secretary for

14 such purposes;’’; and

15 (ii) in subparagraph (C), by striking

16 ‘‘and’’ at the end;

17 (C) in paragraph (7), by striking the pe18 riod at the end and inserting ‘‘; and’’; and

19 (D) by adding at the end the following new

20 paragraph:

21 ‘‘(8) the term ‘health care facility’ means a

22 facility—

23 ‘‘(A) providing integrated health care deliv24 ery services designed and operated to provide

25 medical, convalescent, skilled and intermediate
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1 nursing, board and care services, assisted living,

2 rehabilitation, custodial, personal care services,

3 or any combination thereof;

4 ‘‘(B) designed, in whole or in part, to pro5 vide a continuum of care, as determined by the

6 Secretary;

7 ‘‘(C) providing clinical services, out patient

8 services, including community health services

9 and medical practice facilities and group prac10 tice facilities to persons not in need of the serv11 ices rendered in other facilities insurable under

12 this title; or

13 ‘‘(D)(i) designed, in whole or in part—

14 ‘‘(I) to provide health care services

15 which are not acute care in nature to per16 sons (including the elderly and infirm); or

17 ‘‘(II) to provide supportive or ancil18 lary services to hospitals (as defined in sec19 tion 242(b)), which services may include

20 services provided by special use health care

21 facilities, professional office buildings, lab22 oratories, administrative offices, and other

23 facilities supportive or ancillary to health

24 care delivery; and
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1 ‘‘(ii) that meet standards acceptable to the

2 Secretary, which may include standards gov3 erning licensure or State or local approval and

4 regulation of a mortgagor; or

5 ‘‘(E) that provides any combination of the

6 services under subparagraphs (a) through

7 (D).’’;

8 (3) in subsection (d)—

9 (A) in the matter preceding paragraph

10 (1)—

11 (i) by inserting ‘‘board and care

12 home,’’ after ‘‘rehabilitated nursing

13 home,’’;

14 (ii) by inserting ‘‘health care facility,’’

15 after ‘‘assisted living facility,’’ the first two

16 places it appears;

17 (iii) by inserting ‘‘board and care

18 home,’’ after ‘‘existing nursing home,’’;

19 and

20 (iv) by striking ‘‘or a board and care

21 home’’ and inserting ‘‘, board and care

22 home or health care facility’’;

23 (B) in paragraph (2), in the matter pre24 ceding subparagraph (A), by inserting after

25 ‘‘including’’ the following: ‘‘or a public body,
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1 public agency, or public corporation eligible

2 under this section’’;

3 (C) in paragraph (4)(A)—

4 (i) in the first sentence—

5 (I) by inserting ‘‘, and health

6 care facilities which include such

7 nursing home and intermediate care

8 facilities,’’ before ‘‘, the Secretary’’;

9 (II) by inserting ‘‘or the portion

10 of a health care facility providing such

11 services’’ before ‘‘covered by the mort12 gage,’’; and

13 (III) by inserting ‘‘or for such

14 nursing or intermediate care services

15 within a health care facility’’ before ‘‘,

16 and (ii)’’;

17 (ii) in the second sentence, by insert18 ing ‘‘(which may be within a health care

19 facility)’’ after ‘‘home and facility’’; and

20 (iii) in the third sentence—

21 (I) by striking ‘‘mortgage under

22 this section’’ and all that follows

23 through ‘‘feasibility’’ and inserting the

24 following: ‘‘such mortgage under this

25 section unless (i) the proposed mort-
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1 gagor or applicant for the mortgage

2 insurance for the home or facility or

3 combined home or facility, or the

4 health care facility containing such

5 services, has commissioned and paid

6 for the preparation of an independent

7 study of market need for the project’’;

8 (II) in clause (i)(II), by striking

9 ‘‘and its relationship to, other health

10 care facilities and’’ and inserting ‘‘or

11 such facilities within a health care fa12 cility, and its relationship to, other fa13 cilities providing health care’’;

14 (III) in clause (i)(IV), by striking

15 ‘‘in the event the State does not pre16 pare the study,’’; and

17 (IV) in clause (i)(IV), by striking

18 ‘‘the State or’’;

19 (iv) by striking the penultimate sen20 tence and inserting the following new sen21 tences: ‘‘A study commissioned or under22 taken by the State in which the facility will

23 be located shall be considered to satisfy

24 such market study requirement. The pro25 posed mortgagor or applicant may reim-
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1 burse the State for the cost of an inde2 pendent study referred to in the preceding

3 sentence.’’; and

4 (v) in the last sentence—

5 (I) by inserting ‘‘the proposed

6 mortgagor or applicant for mortgage

7 insurance may obtain from’’ after ‘‘10

8 individuals,’’;

9 (II) by striking ‘‘may’’ and in10 serting ‘‘and’’; and

11 (III) by inserting a comma before

12 ‘‘written support’’; and

13 (D) in paragraph (4)(C)(iii), by striking

14 ‘‘the appropriate State’’ and inserting ‘‘any ap15 propriate’’; and

16 (4) in subsection (i)(1) by inserting ‘‘health

17 care facilities,’’ after ‘‘assisted living facilities,’’.

18 SEC. 503. HOSPITALS AND HOSPITAL-BASED HEALTH CARE

19 FACILITIES.

20 Section 242 of the National Housing Act (12 U.S.C.

21 1715z–7) is amended—

22 (1) in subsection (b)—

23 (A) in paragraph (1)—

24 (i) in subparagraph (A), by inserting

25 ‘‘and’’ after the semicolon at the end;
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1 (ii) by striking subparagraph (B);

2 (iii) in subparagraph (C), by striking

3 the period at the end and inserting ‘‘;

4 and’’; and

5 (iv) by redesignating subparagraph

6 (C) as subparagraph (B);

7 (B) in paragraph (2), by striking ‘‘respect8 fully’’ and all that follows and inserting ‘‘given

9 such terms in section 207(a), except that the

10 term ‘mortgage’ shall include a parity first

11 mortgage or parity first deed of trust, subject

12 to such terms and conditions as the Secretary

13 may provide.’; and

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

15 paragraph:

16 ‘‘(3) the term ‘health care facility’ has the

17 meaning given such term in section 232(b).’’;

18 (2) in subsection (d)—

19 (A) in the matter preceding paragraph (1),

20 by inserting after ‘‘operation,’’ the following:

21 ‘‘or which covers a health care facility owned or

22 to be owned by an applicant or proposed mort23 gagor which also owns a hospital, including

24 equipment to be used in its operation,’’;

25 (B) in paragraph (1)—
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1 (i) in the first sentence, by inserting

2 before the period at the end the following:

3 ‘‘and who, in the case of a mortgage cov4 ering a health care facility, is also the

5 owner of a hospital facility’’; and

6 (ii) by adding at the end the following

7 new sentence: ‘‘A mortgage covering a

8 health care facility may only cover the

9 property on which the eligible facility will

10 be located.’’;

11 (C) in paragraph (2)(A) by inserting ‘‘or

12 health care facility’’ before the comma; and

13 (D) in paragraph (4)—

14 (i) in the first sentence, by inserting

15 ‘‘for a hospital’’ after ‘‘any mortgage’’;

16 (ii) by striking the third sentence and

17 inserting the following: ‘‘If no such State

18 agency exists, or if the State agency exists

19 but is not empowered to provide a certifi20 cation that there is a need for the hospital

21 as set forth in clause (A) of the first sen22 tence, the Secretary shall not insure any

23 such mortgage under this section unless:

24 (A) the proposed mortgagor or applicant

25 for the hospital has commissioned and paid
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1 for the preparation of an independent

2 study of market need for the proposed

3 project that: (i) is prepared in accordance

4 with the principles established by the Sec5 retary, in consultation with the Secretary

6 of Health and Human Services (to the ex7 tent the Secretary of Housing and Urban

8 Development considers appropriate); (ii)

9 assesses, on a marketwide basis, the im10 pact of the proposed hospital on, and its

11 relationship to, other facilities providing

12 health care services, the percentage of ex13 cess beds, demographic projections, alter14 native health care delivery systems, and

15 the reimbursement structure of the hos16 pital; (iii) is addressed to and is acceptable

17 to the Secretary in form and substance;

18 and (iv) is prepared by a financial consult19 ant selected by the proposed mortgagor or

20 applicant and approved by the Secretary;

21 and (B) the State complies with the other

22 provisions of this paragraph that would

23 otherwise be required to be met by a State

24 agency designated in accordance with sec25 tion 604(a)(1) or section 1521 of the Pub-
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1 lic Health Service Act. A study commis2 sioned or undertaken by the State in which

3 the hospital will be located shall be consid4 ered to satisfy such market study require5 ment.’’; and

6 (iii) in the last sentence, by striking

7 ‘‘feasibility’’; and

8 (3) in subsection (f), by inserting ‘‘and public

9 health care facilities’’ after ‘‘public hospitals’’.

10 SEC. 504. HOME EQUITY CONVERSION MORTGAGES.

11 (a) INSURANCE FOR MORTGAGES TO REFINANCE EX12 ISTING HECMS.—

13 (1) IN GENERAL.—Section 255 of the National

14 Housing Act (12 U.S.C. 1715z–20) is amended—

15 (A) by redesignating subsection (k) as sub16 section (l); and

17 (B) by inserting after subsection (j) the

18 following new subsection:

19 ‘‘(k) INSURANCE AUTHORITY FOR REFINANCINGS.—

20 ‘‘(1) IN GENERAL.—The Secretary may, upon

21 application by a mortgagee, insure under this sub22 section any mortgage given to refinance an existing

23 home equity conversion mortgage insured under this

24 section.
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1 ‘‘(2) ANTI-CHURNING DISCLOSURE.—The Sec2 retary shall, by regulation, require that the mort3 gagee of a mortgage insured under this subsection,

4 provide to the mortgagor, within an appropriate time

5 period and in a manner established in such regula6 tions, a good faith estimate of: (A) the total cost of

7 the refinancing; and (B) the increase in the mortga8 gor’s principal limit as measured by the estimated

9 initial principal limit on the mortgage to be insured

10 under this subsection less the current principal limit

11 on the home equity conversion mortgage that is

12 being refinanced and insured under this subsection.

13 ‘‘(3) WAIVER OF COUNSELING REQUIRE14 MENT.—The mortgagor under a mortgage insured

15 under this subsection may waive the applicability,

16 with respect to such mortgage, of the requirements

17 under subsection (d)(2)(B) (relating to third party

18 counseling), but only if—

19 ‘‘(A) the mortgagor has received the disclo20 sure required under paragraph (2);

21 ‘‘(B) the increase in the principal limit de22 scribed in paragraph (2) exceeds the amount of

23 the total cost of refinancing (as described in

24 such paragraph) by an amount to be deter25 mined by the Secretary; and
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1 ‘‘(C) the time between the closing of the

2 original home equity conversion mortgage that

3 is refinanced through the mortgage insured

4 under this subsection and the application for a

5 refinancing mortgage insured under this sub6 section does not exceed 5 years.

7 ‘‘(4) CREDIT FOR PREMIUMS PAID.—Notwith8 standing section 203(c)(2)(A), the Secretary may re9 duce the amount of the single premium payment

10 otherwise collected under such section at the time of

11 the insurance of a mortgage refinanced and insured

12 under this subsection. The amount of the single pre13 mium for mortgages refinanced under this sub14 section shall be determined by the Secretary based

15 on the actuarial study required under paragraph (5).

16 ‘‘(5) ACTUARIAL STUDY.—Not later than 180

17 days after the date of the enactment of this sub18 section, the Secretary shall conduct an actuarial

19 analysis to determine the adequacy of the insurance

20 premiums collected under the program under this

21 subsection with respect to—

22 ‘‘(A) a reduction in the single premium

23 payment collected at the time of the insurance

24 of a mortgage refinanced and insured under

25 this subsection;
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1 ‘‘(B) the establishment of a single national

2 limit on the benefits of insurance under sub3 section (g) (relating to limitation on insurance

4 authority); and

5 ‘‘(C) the combined effect of reduced insur6 ance premiums and a single national limitation

7 on insurance authority.

8 ‘‘(6) FEES.—The Secretary may establish a

9 limit on the origination fee that may be charged to

10 a mortgagor under a mortgage insured under this

11 subsection, except that such limitation shall provide

12 that the origination fee may be fully financed with

13 the mortgage and shall include any fees paid to cor14 respondent mortgagees approved by the Secretary.

15 The Secretary shall prohibit the charging of any

16 broker fees in connection with mortgages insured

17 under this subsection.’’.

18 (2) REGULATIONS.—Notwithstanding sections 2

19 and 3 of the Preserving Affordable Housing for Sen20 ior Citizens and Families into the 21st Century Act,

21 the Secretary shall issue any final regulations nec22 essary to implement the amendments made by para23 graph (1) of this subsection, which shall take effect

24 not later than the expiration of the 180-day period

25 beginning on the date of the enactment of this Act.
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1 The regulations shall be issued after notice and op2 portunity for public comment in accordance with the

3 procedure under section 553 of title 5, United States

4 Code, applicable to substantive rules (notwith5 standing subsections (a)(2), (b)(B), and (d)(3) of

6 such section).

7 (b) STUDY OF SINGLE NATIONAL MORTGAGE

8 LIMIT.—The Secretary of Housing and Urban Develop9 ment shall conduct an actuarially based study of the ef10 fects of establishing, for mortgages insured under section

11 255 of the National Housing Act (12 U.S.C. 1715z–20),

12 a single maximum mortgage amount limitation in lieu of

13 applicability of section 203(b)(2) of such Act (12 U.S.C.

14 1709(b)(2)). The study shall—

15 (1) examine the effects of establishing such lim16 itation at different dollar amounts; and

17 (2) examine the effects of such various limita18 tions on—

19 (A) the risks to the General Insurance

20 Fund established under section 519 of such

21 Act;

22 (B) the mortgage insurance premiums that

23 would be required to be charged to mortgagors

24 to ensure actuarial soundness of such Fund;

25 and
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HR 202 RFS

1 (C) take into consideration the various ap2 proaches to providing credit to borrowers who

3 refinance home equity conversion mortgages in4 sured under section 255 of such Act.

5 Not later than 180 days after the date of the enactment

6 of this Act, the Secretary shall complete the study under

7 this subsection and submit a report describing the study

8 and the results of the study to the Committee on Banking

9 and Financial Services of the House of Representatives

10 and to the Committee on Banking, Housing, and Urban

11 Affairs of the Senate.

Passed the House of Representatives September 27,

1999.

Attest: JEFF TRANDAHL,

Clerk.