I 

111TH CONGRESS 

2D SESSION H. R. 4868 

To prevent the loss of affordable housing dwelling units in the United States. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 17, 2010 

Mr. FRANK of Massachusetts (for himself, Ms. WATERS, Mr. GUTIERREZ, Ms. 

VELA ́ZQUEZ, Mr. CAPUANO, Mr. HINOJOSA, Mr. BACA, Mr. LYNCH, Mr. 

AL GREEN of Texas, Ms. KILROY, Mr. HIMES, Ms. CLARKE, and Mr. 

DELAHUNT) introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the Committees on the 

Budget and Ways and Means, for a period to be subsequently determined 

by the Speaker, in each case for consideration of such provisions as fall 

within the jurisdiction of the committee concerned 

A BILL 

To prevent the loss of affordable housing dwelling units 

in the United States. 

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

3 SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. 

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

5 ‘‘Housing Preservation and Tenant Protection Act of 

6 2010’’. 

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

8 this Act is as follows: 


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Sec. 1. Short title and table of contents. 

Sec. 2. Implementation. 

Sec. 3. Budget treatment. 

TITLE I—PRESERVATION OF FEDERALLY FINANCED AND STATEFINANCED AFFORDABLE HOUSING AT RISK OF CONVERSION 

TO MARKET-RATE HOUSING 

Sec. 101. Conversion of rent supplement and RAP contracts to project-based 

rental assistance under section 8. 

Sec. 102. Preservation of properties with expiring use restrictions. 

Sec. 103. Enhanced voucher assistance and preservation project-based section 

8 assistance for State-financed affordable housing. 

Sec. 104. Project-based preservation assistance. 

Sec. 105. Preservation of State-financed affordable housing. 

Sec. 106. Preservation exchange program. 

Sec. 107. Federal first right of refusal. 

Sec. 108. Amendment to Low-Income Housing Preservation and Resident 

Homeownership Act of 1990. 

Sec. 109. Preservation of HUD-held and HUD-owned buildings. 

Sec. 110. Authority for HUD to assign flexible subsidy loans. 

Sec. 111. Use of existing section 8 funds to preserve and revitalize affordable 

housing. 

Sec. 112. Authority for Ginnie Mae to securitize FHA risk-sharing mortgages. 

TITLE II—RESTORATION OF HOUSING AT RISK OF LOSS DUE TO 

DETERIORATION 

Sec. 201. Authority to transfer rental assistance to other properties. 

Sec. 202. Building transfers: requirements for purchasers of FHA insured 

projects and section 8 projects. 

Sec. 203. Use of interest reduction payments for rehabilitation grants. 

Sec. 204. Clarification of budget-based rent increases for rehabilitated projects. 

Sec. 205. Interest reduction payments for section 236 projects experiencing a 

reduction of units. 

TITLE III—PROTECTION OF RESIDENTS 

Sec. 301. Tenant protection voucher to replace lost subsidized units on 1-for1 basis. 

Sec. 302. Maintenance of housing. 

Sec. 303. Resident enforcement of public housing agency or project owner 

agreements with HUD. 

Sec. 304. Resident access to building information. 

TITLE IV—PRESERVATION OF TROUBLED PROJECTS FACING 

FORECLOSURE 

Sec. 401. Maintaining affordability through escrowing of rental assistance. 

Sec. 402. Multifamily housing mortgage foreclosure. 

Sec. 403. Building acquisition: valuation of physically distressed properties sold 

by HUD. 

Sec. 404. Investment through up-front grants from General Insurance Fund. 

Sec. 405. Maintaining project-based assistance for projects disposed of by 

HUD. 

Sec. 406. Correcting harm caused by late subsidy payments. 


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TITLE V—INCENTIVES UNDER MAHRA FOR OWNERS TO 

MAINTAIN HOUSING AFFORDABILITY 

Sec. 501. Extension of mark-to-market program. 

Sec. 502. Maintaining affordability in preservation project transactions. 

Sec. 503. Encouraging continued participation in assisted housing programs. 

Sec. 504. Prepayment of FHA mortgages on multifamily housing. 

Sec. 505. Period of eligibility for nonprofit debt relief. 

Sec. 506. Acquisition of restructured projects by nonprofit organizations. 

Sec. 507. Rent adjustments upon subsequent renewals of section 8 contracts. 

Sec. 508. Budget-based rent adjustments. 

Sec. 509. Independent appraisal requirement in cases of divergent rent studies. 

Sec. 510. Extension of housing assistance payment contract. 

Sec. 511. Otherwise eligible projects. 

Sec. 512. Exception rents. 

Sec. 513. Disaster-damaged eligible projects. 

Sec. 514. Funding for tenant and other participation and capacity building. 

TITLE VI—PRESERVATION DATABASE 

Sec. 601. Preservation database. 

TITLE VII—SECTION 202 SUPPORTIVE HOUSING FOR THE 

ELDERLY 

Sec. 701. Short title and table of contents. 

Subtitle A—New Construction Reforms 

Sec. 711. Project rental assistance. 

Sec. 712. Selection criteria. 

Sec. 713. Development cost limitations. 

Sec. 714. Owner deposits. 

Sec. 715. Definition of private nonprofit organization. 

Sec. 716. Preferences for homeless elderly. 

Sec. 717. Nonmetropolitan allocation. 

Subtitle B—Refinancing 

Sec. 721. Approval of prepayment of debt. 

Sec. 722. Sources of refinancing. 

Sec. 723. Use of unexpended amounts. 

Sec. 724. Use of project residual receipts. 

Sec. 725. Additional provisions. 

Subtitle C—Assisted Living Facilities 

Sec. 731. Definition of assisted living facility. 

Sec. 732. Monthly assistance payment under rental assistance. 

Subtitle D—National Senior Housing Clearinghouse 

Sec. 741. National senior housing clearinghouse. 

TITLE VIII—RURAL HOUSING PRESERVATION 

Sec. 801. Short title. 

Sec. 802. Preservation of multifamily housing. 

Sec. 803. Rural preservation and rural tenant protection vouchers. 


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Sec. 804. Tenant participation. 

Sec. 805. Priority for financing. 

Sec. 806. Conforming amendment. 

Sec. 807. Regulations. 

1 SEC. 2. IMPLEMENTATION. 

2 The Secretary of Housing and Urban Development 

3 and the Secretary of Agriculture, as applicable, shall by 

4 notice establish any additional requirements that may be 

5 necessary to immediately, except as specifically provided 

6 otherwise, carry out the provisions of this Act. Such notice 

7 shall take effect upon issuance. 

8 SEC. 3. BUDGET TREATMENT. 

9 The budgetary effects of this Act, for the purpose of 

10 complying with the Statutory Pay-As-You-Go Act of 2010, 

11 shall be determined by reference to the latest statement 

12 titled ‘‘Budgetary Effects of PAYGO Legislation’’ for this 

13 Act, submitted for printing in the Congressional Record 

14 by the Chairman of the Committee on the Budget of the 

15 House of Representatives, provided that such statement 

16 has been submitted prior to the vote on passage. 


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1 TITLE I—PRESERVATION OF 

2 FEDERALLY FINANCED AND 

3 STATE-FINANCED AFFORD4 ABLE HOUSING AT RISK OF 

5 CONVERSION TO MARKET6 RATE HOUSING 

7 SEC. 101. CONVERSION OF RENT SUPPLEMENT AND RAP 

8 CONTRACTS TO PROJECT-BASED RENTAL AS9 SISTANCE UNDER SECTION 8. 

10 (a) CONVERSION.—Notwithstanding any other provi11 sion of law and subject to the availability of appropria12 tions, the Secretary of Housing and Urban Development 

13 shall, at the request of a project owner with a contract 

14 under section 101 of the Housing and Urban Development 

15 Act of 1965 (12 U.S.C. 1701s) or a contract under section 

16 236(f)(2) of the National Housing Act (12 U.S.C. 1715z– 

17 1(f)(2)), submitted during the 12-month period beginning 

18 on the date of the enactment of this Act, convert such 

19 contract to project-based assistance under section 8 of the 

20 United States Housing Act of 1937 (42 U.S.C. 1437f) (in 

21 this section referred to as ‘‘section 8’’). 

22 (b) TERMS.—A contract for project-based rental as23 sistance under section 8 pursuant to a conversion under 

24 subsection (a) of this section shall— 


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1 (1) be subject to the availability of amounts 

2 provided in appropriations Act; and 

3 (2) have a term that is not shorter in duration 

4 than the remaining term of the contract that is con5 verted, pursuant to subsection (a) of this section, to 

6 project-based assistance under such section 8, plus 

7 an additional term of not less than 5 years, and up 

8 to 30 years at the request of the owner. 

9 (c) LOAN MANAGEMENT ASSISTANCE CONTRACTS.— 

10 After the initial year of a project-based rental assistance 

11 contract under section 8 for loan management assistance, 

12 the contract may, at the option of the project owner and 

13 subject to the conditions specified in section 524(a)(4)(D) 

14 of the Multifamily Assisted Housing Reform and Afford15 ability Act of 1997 (42 U.S.C. 1437f note), be converted 

16 to a renewal contract under such section 524, subject to 

17 the availability of appropriations, if the project owner 

18 agrees to a contract term that extends 10 years beyond 

19 the remaining term of the assistance contract. 

20 (d) USE RESTRICTIONS.—Notwithstanding any other 

21 provision of law, conversion of a contract pursuant to sub22 section (a) shall not diminish the affordability restrictions 

23 or number of assisted units applicable to the property that 

24 is subject to the contract converted. 


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1 (e) USE OF RECAPTURED AMOUNTS.—Any budget 

2 authority recaptured as a result of conversion of any con3 tract pursuant to subsection (a) shall be used by the Sec4 retary of Housing and Urban Development for making as5 sistance payments with respect to the initial 12-month pe6 riod of the contract for project-based rental assistance 

7 under section 8 resulting from such conversion. 

8 SEC. 102. PRESERVATION OF PROPERTIES WITH EXPIRING 

9 USE RESTRICTIONS. 

10 (a) FEDERAL ASSISTANCE AND EXTENSION OF AF11 FORDABILITY REQUIREMENTS.— 

12 (1) PROVISION OF ASSISTANCE.— 

13 (A) AUTHORITY.—The Secretary of Hous14 ing and Urban Development may use amounts 

15 made available under paragraph (5) to provide 

16 assistance under this section with respect to 

17 covered multifamily housing properties. 

18 (B) APPLICATIONS AND SELECTION CRI19 TERIA.—The Secretary shall provide for owners 

20 of covered multifamily housing properties to 

21 submit applications for assistance under this 

22 section and shall establish criteria for selection 

23 of properties to receive assistance that shall 

24 take into consideration the need of a property 

25 for such assistance. 


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1 (2) REHABILITATION ASSISTANCE.—The Sec2 retary may provide a grant or loan under this para3 graph to the owner or purchaser of the property, 

4 subject to the following requirements: 

5 (A) PURPOSE.—The assistance shall be 

6 provided for the purpose of rehabilitating the 

7 property for continued use as housing afford8 able to low- and moderate-income families. 

9 (B) ELIGIBLE USE.—Amounts from the 

10 grant or loan may be used only for payment of 

11 nonrecurring maintenance and capital improve12 ments for the property, and associated trans13 action costs, under such terms and conditions 

14 as are determined by the Secretary. 

15 (C) PER UNIT AMOUNT LIMITATIONS.— 

16 The amount from a grant or loan used with re17 spect to a dwelling unit in the property may not 

18 exceed the per unit dollar amount limitation as 

19 the Secretary shall establish for purposes of 

20 this paragraph for dwelling units of the applica21 ble size. 

22 (D) REQUIRED EXTENSION OF AFFORD23 ABILITY RESTRICTIONS.—The Secretary may 

24 provide assistance under this paragraph for a 

25 property only if the owner of the property enVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 ters into such binding commitments as the Sec2 retary may require, which shall be applicable to 

3 any subsequent owner, to ensure that the prop4 erty will be operated, for a period of not less 

5 than 30 years that begins on the termination 

6 date for the property, in accordance with all af7 fordability restrictions that are applicable to the 

8 property under the multifamily housing subsidy 

9 program under which the property is assisted 

10 before the termination date, with flexibility to 

11 recognize more significant restrictions accom12 panying other subsidies for the property. 

13 (3) ASSISTANCE FOR PURCHASE.—The Sec14 retary may provide a grant or loan under this para15 graph to an eligible organization under subpara16 graph (B) for acquisition of a covered multifamily 

17 housing property, subject to the following require18 ments: 

19 (A) PURPOSE.—The assistance shall be 

20 provided for the purpose of facilitating acquisi21 tion of properties by eligible organizations 

22 whose missions are to provide affordable hous23 ing to low- and moderate-income families. 

24 (B) ELIGIBLE ORGANIZATIONS.—A grant 

25 or loan under this paragraph may be made only 


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1 to a nonprofit organization, a for-profit organi2 zation, or a public housing agency (as such 

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

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

5 1437a(b)) that provides such assurances as the 

6 Secretary may require that the organization— 

7 (i) will acquire the property; and 

8 (ii) is capable of managing the prop9 erty and related facilities (either directly or 

10 through a contract) for the remaining use11 ful life of the property and related facili12 ties. 

13 (C) ELIGIBLE USE.—Amounts from the 

14 grant or loan may be used only to cover any di15 rect costs (other than the purchase price), in16 cluding transaction costs, incurred by the eligi17 ble organization in purchasing and assuming re18 sponsibility for the property and related facili19 ties involved. 

20 (D) PER UNIT AMOUNT LIMITATIONS.— 

21 The amount from a grant or loan used with re22 spect to a dwelling unit in the property may not 

23 exceed the per unit dollar amount limitation as 

24 the Secretary shall establish for purposes of 


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1 this paragraph for dwelling units of the applica2 ble size. 

3 (E) REQUIRED EXTENSION OF AFFORD4 ABILITY RESTRICTIONS.—The Secretary may 

5 provide assistance under this paragraph for a 

6 property only if the eligible organization that 

7 purchases the property enters into such binding 

8 commitments as the Secretary may require, 

9 which shall be applicable to any subsequent 

10 owner, to ensure that the property will be oper11 ated, for the remaining useful life of the prop12 erty, in accordance with all affordability restric13 tions that are applicable to the property under 

14 the multifamily housing subsidy program under 

15 which the property is assisted before the termi16 nation date. 

17 (4) LOW- AND MODERATE-INCOME AFFORD18 ABILITY ASSISTANCE.—The Secretary may provide 

19 new project-based assistance under section 8 of the 

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

21 1437f) for currently unassisted units in covered mul22 tifamily housing properties occupied by tenants oth23 erwise eligible for such assistance, subject to the fol24 lowing requirements: 


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1 (A) PURPOSE.—The assistance shall be 

2 provided for the purpose of maintaining the af3 fordability of dwelling units in covered multi4 family housing properties not currently provided 

5 project-based rental assistance. 

6 (B) ELIGIBILITY.—Assistance may be 

7 made available for a property only if the prop8 erty— 

9 (i) is located in an area having a dem10 onstrated demand for affordable rental 

11 housing; or 

12 (ii) may be subject to rent level in13 creases as the result of mortgage maturity 

14 or termination or as the result of a recapi15 talization activity approved by the Sec16 retary or the Secretary of Agriculture. 

17 (C) FORM AND TERM.—The assistance 

18 shall be in the form of a housing assistance 

19 payment contract under such section 8 and 

20 shall be provided for such term as may be 

21 agreed to by the Secretary and the owner of the 

22 property. The form of assistance may include 

23 an amendment of an existing assistance con24 tract to cover additional units in the subject 

25 property. 


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1 (D) PREVENTION OF DUPLICATIVE SUB2 SIDIES.—Assistance may not be provided for 

3 any dwelling unit in a property if such assist4 ance would duplicate other project- or tenant5 based rental assistance of any kind for the 

6 dwelling unit from any source. 

7 (E) AMOUNT AND RENT LEVELS.—The 

8 Secretary shall determine the amount of annual 

9 assistance provided for a property based on rent 

10 levels, for the dwelling units in the property 

11 that are subject to affordability restrictions pur12 suant to subparagraph (F), that are equal to 

13 the lesser of— 

14 (i) comparable market rents for the 

15 market area in which the property is lo16 cated for dwelling units of the applicable 

17 size; and 

18 (ii) 150 percent of the fair market 

19 rentals established under section 8(c) of 

20 the United States Housing Act of 1937 for 

21 the market area in which the property is 

22 located for dwelling units of the applicable 

23 size. 

24 (F) REQUIRED EXTENSION OF AFFORD25 ABILITY RESTRICTIONS.—The Secretary may 


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1 provide assistance under this paragraph for a 

2 property only if the owner of the property en3 ters into such binding commitments as the Sec4 retary may require, which shall be applicable to 

5 any subsequent owner, to ensure that the prop6 erty will be operated, for a period not shorter 

7 than the term of the assistance agreed to pur8 suant to subparagraph (C) or 10 years, which9 ever is longer, that begins on the termination 

10 date for the property, in accordance with all af11 fordability restrictions that are applicable to the 

12 property under the multifamily housing subsidy 

13 program under which the property is assisted 

14 before the termination date. 

15 (5) AUTHORIZATION OF APPROPRIATIONS.— 

16 There are authorized to be appropriated for assist17 ance under this subsection such sums as may be 

18 necessary. 

19 (b) ENHANCED VOUCHERS.— 

20 (1) QUALIFICATION; ELECTION TO REMAIN IN

21 UNIT.—Section 8(t)(1) of the United States Housing 

22 Act of 1937 (42 U.S.C. 1437f(t)(1)(B)) is amend23 ed— 

24 (A) in the matter preceding subparagraph 

25 (A), by inserting ‘‘and shall not require that the 


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1 family requalify under the selection standards 

2 for a public housing agency in order to be eligi3 ble for such assistance’’ before the comma; and 

4 (B) by striking subparagraph (B) and in5 serting the following new subparagraph: 

6 ‘‘(B)(i) the assisted family may elect to re7 main in the same project in which the family 

8 was residing on the date of the eligibility event 

9 for the project regardless of unit and family 

10 size standards normally used by the admin11 istering public housing agency (except that ten12 ants may be required to move to units of appro13 priate size if available on the premises), and the 

14 owner of the unit shall accept the enhanced 

15 voucher and terminate the tenancy only for se16 rious or repeated violation of the terms and 

17 conditions of the lease or for violation of appli18 cable law; and 

19 ‘‘(ii) if, during any period the family 

20 makes such an election and continues to so re21 side, the rent for the dwelling unit of the family 

22 in such project exceeds the applicable payment 

23 standard established pursuant to subsection (o) 

24 for the unit, the amount of rental assistance 

25 provided on behalf of the family shall be deterVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 mined using a payment standard that is equal 

2 to the rent for the dwelling unit (as such rent 

3 may be increased from time-to-time), subject to 

4 paragraph (10)(A) of subsection (o) and any 

5 other reasonable limit prescribed by the Sec6 retary, except that a limit shall not be consid7 ered reasonable for purposes of this subpara8 graph if it adversely affects such assisted fami9 lies;’’. 

10 (2) PROVISION TO RESIDENTS OF ASSISTED

11 MULTIFAMILY PROJECTS UPON TERMINATION

12 DATE.— 

13 (A) REQUIREMENT.—Upon the termi14 nation date for each assisted multifamily hous15 ing property, to the extent that amounts for as16 sistance under this paragraph are provided in 

17 advance in appropriation Acts, the Secretary of 

18 Housing and Urban Development shall make 

19 enhanced voucher assistance under section 8(t) 

20 of the United States Housing Act of 1937 (42 

21 U.S.C. 1437f(t)) available on behalf of each 

22 family described in subparagraph (B). The Sec23 retary shall make such assistance available no 

24 later than 60 days before the termination date 

25 on behalf of each family described in subparaVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 graph (B) that elects to move from the prop2 erty. 

3 (B) ELIGIBILITY.—A family described in 

4 this subparagraph is a family who— 

5 (i)(I) is a low-income family (as such 

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

7 United States Housing Act of 1937 (42 

8 U.S.C. 1437a(b))); or 

9 (II) is a moderate-income family that 

10 is— 

11 (aa) an elderly family (as such 

12 term is used in section 3(b) of the 

13 United States Housing Act of 1937 

14 (42 U.S.C. 1437a(b))); 

15 (bb) a disabled family (as such 

16 term is used in section 3(b) of the 

17 United States Housing Act of 1937 

18 (42 U.S.C. 1437a(b))); or 

19 (cc) residing in a low-vacancy 

20 area (as determined by the Secretary); 

21 and 

22 (ii) is residing in— 

23 (I) a property that immediately 

24 before such termination date was an 


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1 assisted multifamily housing property; 

2 and 

3 (II) a dwelling unit that is not 

4 assisted after such termination date 

5 under section 8 of the United States 

6 Housing Act of 1937. 

7 (C) ELIGIBILITY EVENT.—Section 8(t)(2) 

8 of the United States Housing Act of 1937 (42 

9 U.S.C. 1437f(t)(2)) is amended by adding after 

10 the period at the end the following new sen11 tence: ‘‘Such term includes, with respect to an 

12 assisted multifamily housing property (as such 

13 term is defined in section 102(f) of the Housing 

14 Preservation and Tenant Protection Act of 

15 2010), the occurrence of the termination date 

16 (as such term is defined in such section 102(f)) 

17 for the property.’’. 

18 (3) REGULATIONS.—The Secretary of Housing 

19 and Urban Development shall issue regulations to 

20 implement the amendments made by this subsection 

21 not later than the expiration of the 6-month period 

22 beginning on the date of enactment of this Act, and 

23 such regulations shall require that the provisions of 

24 such amendments relating to termination of tenancy 

25 shall be contained in the lease. 


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1 (c) NOTIFICATION REQUIREMENT.— 

2 (1) TIMING.—An owner of an assisted multi3 family housing property, including any owner of a 

4 property with rent limitations that expire concur5 rently with the expiration of the term of the mort6 gage for the property, who intends to terminate or 

7 alter the affordability restrictions for the property 

8 on or after the termination date for the property 

9 shall, not less than 12 months before such termi10 nation date, provide written notice of such termi11 nation date to the Secretary of Housing and Urban 

12 Development, the chief executive officer of the State 

13 and the unit of general local government (as such 

14 term is defined in section 104 of the Cranston-Gon15 zalez National Affordable Housing Act (42 U.S.C. 

16 12704)) in which the property is located, and each 

17 tenant of the property. 

18 (2) CONTENTS.—The notice shall include— 

19 (A) a statement specifying any changes in 

20 the terms or applicability of the affordability re21 strictions for the property that the owner in22 tends to make on or after the termination date 

23 for the property; 

24 (B) a statement that, if the owner pro25 ceeds with such intended changes and the ConVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00019 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 gress makes funds available, the Department of 

2 Housing and Urban Development will provide 

3 tenant-based rental assistance to all eligible 

4 residents, enabling them to choose the place 

5 they wish to rent, which may include the right 

6 to remain in the dwelling unit in which they 

7 currently reside; and 

8 (C) a statement that, if the Congress 

9 makes funds available, the owner and the Sec10 retary may yet agree to renewal of assistance 

11 and affordability restrictions for the property, 

12 thereby obviating the need for such tenant13 based rental assistance. 

14 (3) FAILURE TO PROVIDE NOTICE.—If the 

15 owner does not provide the notice required under 

16 this subsection, notwithstanding any inapplicability 

17 of the affordability restrictions for the property, the 

18 owner may not evict the tenants or increase the ten19 ants’ rent payments until such time as the owner 

20 has provided the notice and the 12-month period be21 ginning upon the provision of such notice has 

22 elapsed. 

23 (4) OTHER TERMS.—The Secretary may, to 

24 preserve affordable housing or protect tenants in 


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1 such properties, establish additional notice require2 ments. 

3 (5) SAVINGS PROVISION.—This subsection may 

4 not be construed to annul, alter, affect, or preempt 

5 any provision of the law of a State or political sub6 division thereof requiring notice regarding termi7 nation of assistance or affordability restrictions with 

8 respect to a multifamily housing project or to ex9 empt any person from complying with such a law. 

10 (d) PROJECTS WITH COMMON USE AGREEMENTS.— 

11 Notwithstanding any provision of the Emergency Low In12 come Housing Preservation Act of 1987 (12 U.S.C. 1715l 

13 note), if two covered multifamily housing properties are 

14 encumbered by use agreements that were recorded in land 

15 records on the same date pursuant to such Act and both 

16 such properties are subject to a single mortgage, both such 

17 use agreements shall be deemed to expire on the earlier 

18 of the expiration dates stated in such use agreements, but 

19 only if the owner of the properties agrees to maintain any 

20 project-based rental assistance for both such properties for 

21 the 30-year period beginning upon such common expira22 tion date. At the request of the owner, the Secretary shall 

23 establish contract rents for such project-based assistance 

24 at levels for comparable properties in the same market 

25 area. 


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1 (e) ANNUAL AND SEMIANNUAL REVIEWS.— 

2 (1) ANNUAL REVIEW.—To ensure compliance 

3 with this section, the Secretary shall conduct an an4 nual review on actions taken under this section and 

5 the status of covered multifamily housing properties 

6 and submit a report to the Congress regarding each 

7 such annual review. 

8 (2) SEMIANNUAL REVIEW.—Not less than semi9 annually during the 2-year period beginning on the 

10 date of the enactment of this Act and not less than 

11 annually thereafter, the Secretary shall submit re12 ports to the Committee on Financial Services of the 

13 House of Representatives and the Committee on 

14 Banking, Housing, and Urban Affairs of the Senate 

15 stating, for such periods, the total number of as16 sisted multifamily housing properties for which noti17 fication has been provided under subsection (c) dur18 ing such period, the total number of covered multi19 family housing properties for which assistance has 

20 been provided under subsection (a), and the type or 

21 types of such assistance provided. 

22 (f) DEFINITIONS.—For purposes of this section: 

23 (1) AFFORDABILITY RESTRICTIONS.—The term 

24 ‘‘affordability restrictions’’ means, with respect to a 

25 covered multifamily housing property, limits imposed 


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1 by regulation, regulatory agreement, or contract on 

2 tenant rents, rent contributions, or income eligibility. 

3 (2) ASSISTED MULTIFAMILY HOUSING PROP4 ERTY.—The term ‘‘assisted multifamily housing 

5 property’’ means a multifamily housing project for 

6 which assistance is provided under a multifamily 

7 housing subsidy program. 

8 (3) COMPARABLE PROPERTIES.—The term 

9 ‘‘comparable properties’’ means, with respect to a 

10 covered multifamily housing property, properties in 

11 the same market area, where practicable, that— 

12 (A) are similar to the covered multifamily 

13 housing property as to neighborhood (including 

14 risk of crime), type of location, access, street 

15 appeal, age, property size, apartment mix, phys16 ical configuration, property and unit amenities, 

17 utilities, and other relevant characteristics; 

18 (B) are not receiving rental assistance of 

19 any kind from any source; and 

20 (C) are not subject to affordability restric21 tions of any kind. 

22 (4) COVERED MULTIFAMILY HOUSING PROP23 ERTY.—The term ‘‘covered multifamily housing 

24 property’’ means an assisted multifamily housing 

25 property for which the termination date will occur 


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1 within the 10-year period beginning on the date of 

2 the enactment of this Act. 

3 (5) LOW-INCOME FAMILY.—The term ‘‘low-in4 come family’’ has the meaning given such term in 

5 section 3(b) of the United States Housing Act of 

6 1937 (42 U.S.C. 1437a(b)). 

7 (6) MODERATE-INCOME FAMILY.—The term 

8 ‘‘moderate-income family’’ has the meaning given 

9 such term in section 229 of the Low-Income Hous10 ing Preservation and Resident Homeownership Act 

11 of 1992 (12 U.S.C. 4119). 

12 (7) MULTIFAMILY HOUSING SUBSIDY PRO13 GRAM.—The term ‘‘multifamily housing subsidy pro14 gram’’ means— 

15 (A) the rent supplement program under 

16 section 101 of the Housing and Urban Develop17 ment Act of 1965 (12 U.S.C. 1701s); 

18 (B) the below-market interest rate mort19 gage insurance program under section 

20 221(d)(3) of the National Housing Act (12 

21 U.S.C. 1715l(d)(3)); 

22 (C) a contract under section 236(f)(2) of 

23 the National Housing Act (12 U.S.C. 1715z– 

24 1(f)(2)); 


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1 (D) the program for interest reduction 

2 payments under section 236 of the National 

3 Housing Act (12 U.S.C. 1715z–1) and any 

4 comparable State program providing for inter5 est reduction payments; 

6 (E) the program for supportive housing for 

7 the elderly under section 202 of the Housing 

8 Act of 1959 (12 U.S.C. 1701q), including as9 sistance under such section as in effect before 

10 the enactment of the Cranston-Gonzalez Na11 tional Affordable Housing Act; 

12 (F) the program for rural rental housing 

13 under section 515 of the Housing Act of 1949 

14 (42 U.S.C. 1485); and 

15 (G) any other mortgage insurance program 

16 provided under the National Housing Act for 

17 which the insured property is subject to budget18 based rent restrictions. 

19 (8) NONPROFIT ORGANIZATION.—The term 

20 ‘‘nonprofit organization’’ has the meaning, with re21 spect to housing assisted under this section, given 

22 such term in section 202(k) of the Housing Act of 

23 1959 (12 U.S.C. 1701q(k)). 

24 (9) SECRETARY.—The term ‘‘Secretary’’ means 

25 the Secretary of Housing and Urban Development. 


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1 (10) TERMINATION DATE.—The term ‘‘termi2 nation date’’ means, with respect to an assisted or 

3 a covered multifamily housing property, the date 

4 that— 

5 (A) the mortgage, loan, or capital advance 

6 for the property matures or expires and the af7 fordability restrictions applicable to the prop8 erty because of assistance for the property pur9 suant to a multifamily housing subsidy program 

10 terminate with respect to the property; 

11 (B) an assistance contract for the property 

12 that is not renewed, terminates, or expires; 

13 (C) in the case of a property that is not el14 igible low-income housing, as such term is de15 fined in section 229 of the Low-Income Hous16 ing Preservation and Resident Homeownership 

17 Act of 1990 (12 U.S.C. 4119), the mortgage or 

18 loan that covers the property is prepaid or an 

19 insurance contract that covers the property ter20 minates; or 

21 (D) use restrictions imposed with respect 

22 to the property pursuant to the Emergency Low 

23 Income Housing Preservation Act of 1987 ex24 pire. 


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1 (g) REGULATIONS.—The Secretary may issue any 

2 regulations necessary to carry out this section. 

3 SEC. 103. ENHANCED VOUCHER ASSISTANCE AND PRESER4 VATION PROJECT-BASED SECTION 8 ASSIST5 ANCE FOR STATE-FINANCED AFFORDABLE 

6 HOUSING. 

7 (a) ENHANCED VOUCHER ASSISTANCE.— 

8 (1) REQUIREMENT.—Upon the prepayment or 

9 maturity of a mortgage for which interest reduction 

10 payments have been made through a State housing 

11 program or financed by a State housing finance 

12 agency and subsidized by interest reduction pay13 ments made pursuant to section 236 of the National 

14 Housing Act (12 U.S.C. 1715z–1), to the extent 

15 that amounts for assistance under this subsection 

16 are provided in advance in appropriation Acts, the 

17 Secretary of Housing and Urban Development shall 

18 make enhanced voucher assistance under section 8(t) 

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

20 1437(t)) available on behalf of families described in 

21 paragraph (2). 

22 (2) ELIGIBLE FAMILIES.—A family described in 

23 this paragraph is a family that— 


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1 (A)(i) is a low-income family, as such term 

2 is defined in section 3(b) of the United States 

3 Housing Act of 1937 (42 U.S.C. 1437a(b)); or 

4 (ii) is a moderate-income family that has 

5 an income that is not less than 80 percent, and 

6 not greater than 95 percent, of the median in7 come for the area, as determined by the Sec8 retary, that— 

9 (I) is an elderly family (as such term 

10 is used in section 3(b) of the United States 

11 Housing Act of 1937 (42 U.S.C. 

12 1437a(b)); 

13 (II) is a disabled family (as such term 

14 is used in such section 3(b); or 

15 (III) resides in a low-vacancy area, as 

16 determined by the Secretary; and 

17 (B) on such prepayment or maturity date 

18 is residing in dwelling unit of the project that— 

19 (i) immediately before such prepay20 ment or maturity was subject to the mort21 gage for which interest reduction payments 

22 were made and subject to affordability re23 strictions; and 

24 (ii) is not assisted after such prepay25 ment or maturity date under section 8 of 


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1 the United States Housing Act of 1937, 

2 other than as provided under section 

3 8(t)(4) of the United States Housing Act 

4 of 1937 (42 U.S.C. 1437f(t)(4)). 

5 (3) ELIGIBILITY EVENT.—Paragraph (2) of sec6 tion 8(t) of the United States Housing Act of 1937 

7 (42 U.S.C. 1437f(t)(2)), as amended by the pre8 ceding provisions of this Act, is further amended by 

9 adding after the period at the end the following new 

10 sentence: ‘‘Such term also includes, with respect to 

11 a multifamily family housing project with a mort12 gage for which interest reduction payments have 

13 been made through a State housing program or fi14 nanced by a State housing finance agency, the pre15 payment or maturity of such mortgage which results 

16 in eligible residents of such housing project being eli17 gible for enhanced voucher assistance under this 

18 subsection, pursuant to section 103(a) of the Hous19 ing Preservation and Tenant Protection Act of 

20 2010.’’. 

21 (b) PRESERVATION PROJECT-BASED SECTION 8 AS22 SISTANCE.— 

23 (1) IN GENERAL.—Notwithstanding any other 

24 provision of law, in connection with the prepayment 

25 or maturity of a multifamily housing project mortVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 gage subsidized by interest reduction payments 

2 made through a State housing program or financed 

3 by a State housing finance agency and subsidized by 

4 interest reduction payments made pursuant to sec5 tion 236 of the National Housing Act (12 U.S.C. 

6 1715z–1), to prevent displacement of residents and 

7 to further preservation and affordability of such 

8 multifamily housing project, at the election of the 

9 project owner and in lieu of enhanced voucher assist10 ance under subsection (a) of this section or project11 based voucher assistance under subsections (t)(4) 

12 and (o)(13)(N) of section 8 of the United States 

13 Housing Act of 1937 (42 U.S.C. 1437f), the Sec14 retary of Housing and Urban Development shall, 

15 pursuant to the authority under subsections (a) and 

16 (b) of such section 8, enter an annual contributions 

17 contract with the State housing finance agency to 

18 permit the State housing finance agency enter 

19 project-based assistance contract under this sub20 section covering all units in the project for which 

21 such enhanced or project-based voucher assistance 

22 would otherwise be provided. 

23 (2) CONTRACT TERMS.—Any project-based as24 sistance contract pursuant to this subsection shall— 


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1 (A) be considered for all purposes a con2 tract entered into under section 8 of the United 

3 States Housing Act of 1937 (42 U.S.C. 1437f); 

4 (B) have a term of at least 20 years; 

5 (C) provide such assistance at rent levels 

6 established as provided under section 524 of the 

7 Multifamily Assisted Housing Reform and Af8 fordability Act of 1997 (42 U.S.C. 1437f note); 

9 (D) be subsequently renewable at the re10 quest of the owner under such section 524; 

11 (E) be subject to the availability of 

12 amounts provided in appropriations Acts; and 

13 (F) be subject to such other terms as the 

14 Secretary considers appropriate. 

15 (3) INCOME TARGETING.—To the extent that 

16 dwelling units subject to an assistance contract 

17 under this paragraph are occupied by families eligi18 ble for enhanced voucher assistance under section 

19 8(t) of the United States Housing Act of 1937 (42 

20 U.S.C. 1437f(t)), the units shall be considered to be 

21 in compliance with all income targeting requirements 

22 under the United States Housing Act of 1937. 

23 (4) TENANT ELIGIBILITY.—Notwithstanding 

24 any other provision of law, in the multifamily hous25 ing project for which project-based assistance is proVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00031 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 vided pursuant to this subsection, each eligible fam2 ily described in subsection (a)(2) of this section that 

3 resides in a dwelling unit in such project on the date 

4 such assistance contract first becomes effective shall 

5 be considered to meet any applicable requirements 

6 for income eligibility and occupancy. 

7 (5) CONTRACT ADMINISTRATION.—Notwith8 standing any other provision of law, any contract for 

9 project-based assistance entered into pursuant to 

10 this subsection shall be administered by the project11 based contract administrator of the State in which 

12 the multifamily housing project is located. 

13 SEC. 104. PROJECT-BASED PRESERVATION ASSISTANCE. 

14 (a) ENHANCED VOUCHERS.—Section 8(t) of the 

15 United States Housing Act of 1937 (42 U.S.C. 1437f(t)) 

16 is amended— 

17 (1) by redesignating paragraph (4) as para18 graph (5); and 

19 (2) by inserting after paragraph (3) the fol20 lowing new paragraph: 

21 ‘‘(4) PROJECT-BASED PRESERVATION ASSIST22 ANCE.— 

23 ‘‘(A) AUTHORITY.—Notwithstanding any 

24 other provision of law, in the case of a multi25 family housing project eligible under subparaVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00032 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 graph (C), the Secretary shall, subject to the 

2 availability of amounts provided in advance in 

3 appropriation Acts and at the request of the 

4 owner of the project, provide project-based pres5 ervation assistance in accordance with this 

6 paragraph, in such form authorized in subpara7 graph (B) as is requested by the owner, in lieu 

8 of enhanced voucher assistance under this sub9 section. Such owner of the project shall agree to 

10 accept such project-based preservation assist11 ance for a period of not less than 20 years: Pro12 vided, That any renewal contract during such 

13 period is offered on terms and conditions com14 parable to the original contract. 

15 ‘‘(B) FORMS.—Project-based preservation 

16 assistance provided in accordance with this 

17 paragraph shall be in one of the following 

18 forms: 

19 ‘‘(i) PROJECT-BASED PRESERVATION

20 VOUCHERS.—Project-based voucher assist21 ance, which shall be provided in accordance 

22 with subsection (o)(13)(N). 

23 ‘‘(ii) PROJECT-BASED ASSISTANCE.— 

24 Project-based assistance under the terms 

25 and conditions in section 524 of the MultiVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00033 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 family Assisted Housing Reform and Af2 fordability Act of 1997 (42 U.S.C. 1437f 

3 note). In determining the initial rent levels 

4 for a contract for project-based assistance 

5 under this subparagraph, the Secretary 

6 shall establish initial contract rents at the 

7 comparable market rents for the area (as 

8 such term is defined in section 524(a)(5) 

9 of the Multifamily Assisted Housing Re10 form and Affordability Act of 1997 (42 

11 U.S.C. 1437f note)). 

12 ‘‘(C) ELIGIBLE PROJECTS.—A multifamily 

13 housing project is eligible under this subpara14 graph if— 

15 ‘‘(i)(I) an eligibility event for the 

16 project occurs; and 

17 ‘‘(II) the project is not a project for 

18 which the owner has opted not to renew a 

19 contract for project-based rental assistance 

20 under this section; or 

21 ‘‘(ii) enhanced voucher assistance has 

22 already been provided for the project pur23 suant to the conditions specified in sub24 paragraph (F)(ii). 

25 ‘‘(D) ELIGIBLE UNITS.— 


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1 ‘‘(i) INCOME ELIGIBILITY.—Assistance 

2 pursuant to this paragraph may be pro3 vided for all dwelling units in a multifamily 

4 housing project for which tenants residing 

5 in the project at the time assistance is ini6 tially provided meet income eligibility re7 quirements for enhanced voucher assist8 ance under this subsection. 

9 ‘‘(ii) ADDITIONAL UNITS.— At the re10 quest of the owner of a multifamily hous11 ing project for which assistance pursuant 

12 to this paragraph is provided, the Sec13 retary may approve assistance for addi14 tional dwelling units, which may include 

15 units that are vacant at the time of the eli16 gibility event, subject to a determination 

17 by the Secretary that such additional as18 sistance is necessary or desirable to further 

19 the purposes reflected in subparagraph 

20 (E). 

21 ‘‘(iii) RENT PAYMENTS.—Eligible 

22 families residing in a project at the time 

23 assistance pursuant to this paragraph is 

24 provided shall be subject to the provisions 

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1 graph (1) of this subsection. Notwith2 standing the preceding sentence, an eligible 

3 family that is a low-income family shall not 

4 be required to pay as rent for a dwelling 

5 unit assisted pursuant to this paragraph 

6 an amount that exceeds 30 percent of the 

7 family’s adjusted monthly income. 

8 ‘‘(iv) INCOME ELIGIBILITY.—For pur9 poses of income targeting requirements 

10 under section 16 of the United States 

11 Housing Act of 1937 (42 U.S.C. 1437n), 

12 tenants initially assisted under this para13 graph shall not be considered new tenants. 

14 ‘‘(E) REQUIRED DETERMINATIONS.—As a 

15 condition of entering into a contract pursuant 

16 to this paragraph, the Secretary shall have de17 termined, pursuant to standards established by 

18 the Secretary and before entering into such 

19 contract, that— 

20 ‘‘(i) the housing to be assisted under 

21 the contract is economically viable; and 

22 ‘‘(ii)(I) there is a significant demand 

23 for the housing; 

24 ‘‘(II) the housing will contribute to a 

25 community revitalization plan or to 


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1 deconcentrating poverty and expanding 

2 housing and economic opportunities; or 

3 ‘‘(III) the continued affordability of 

4 the housing otherwise is an important 

5 asset to the community. 

6 The Secretary may delegate the authority to 

7 make the determination under this subpara8 graph to the public housing agency or project9 based contract administrator that would admin10 ister project-based assistance for such project. 

11 Such public housing agency or project-based 

12 contract administrator shall apply such stand13 ards as the Secretary shall establish in making 

14 such determination. 

15 ‘‘(F) TIMING OF REQUEST.— 

16 ‘‘(i) PROJECTS FOR WHICH REQUEST

17 IS MADE BEFORE ELIGIBILITY EVENT.—In 

18 the case of a project eligible for assistance 

19 under subparagraph (C)(i) that is re20 quested prior to the occurrence of the eligi21 bility event, a contract for assistance pur22 suant to this paragraph shall be provided 

23 upon the occurrence of the eligibility event. 

24 ‘‘(ii) REQUEST MADE AFTER

25 ISSUANCE OF ENHANCED VOUCHERS.—In 


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1 the case of a project eligible for assistance 

2 under subparagraph (C)(ii) that is re3 quested after the issuance of enhanced 

4 voucher assistance for the project, a con5 tract for assistance pursuant to this para6 graph shall be provided only— 

7 ‘‘(I) if the eligibility event for the 

8 project occurred before the date of the 

9 enactment of the Housing Preserva10 tion and Tenant Protection Act of 

11 2010 and a request for such assist12 ance is made within 12 months after 

13 such date of enactment (or such 

14 longer period as the Secretary may 

15 permit to facilitate preservation of the 

16 project as affordable housing); 

17 ‘‘(II) if the project is sold or oth18 erwise transferred and the new owner 

19 requests such assistance within 12 

20 months (or such longer period as the 

21 Secretary may permit to facilitate 

22 preservation of the project as afford23 able housing) of such purchase; or 

24 ‘‘(III) in such other cir25 cumstances as the Secretary may deVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00038 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 termine are necessary or appropriate 

2 to facilitate preservation of the project 

3 as affordable. 

4 Assistance for projects eligible pursuant to 

5 subparagraph (C)(ii) may only be provided 

6 as project-based preservation voucher as7 sistance under subparagraph (B)(i). Such 

8 contract shall cover all dwelling units in 

9 the project that are occupied by tenants re10 ceiving enhanced voucher assistance at the 

11 time the contract is effective, plus any ad12 ditional units as may be approved for the 

13 project pursuant to subparagraph 

14 (D)(ii).’’. 

15 (b) PHA PROJECT-BASED VOUCHER ASSISTANCE.— 

16 Paragraph (13) of section 8(o) of the United States Hous17 ing Act of 1937 (42 U.S.C. 1437f(o)(13)) is amended by 

18 adding at the end the following new subparagraph: 

19 ‘‘(N) PRESERVATION ASSISTANCE.— 

20 ‘‘(i) AUTHORITY.—Project-based 

21 voucher assistance in accordance with this 

22 subparagraph shall be provided for projects 

23 eligible for such assistance pursuant to 

24 subsection (t)(4). 


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1 ‘‘(ii) AUTHORITY FOR HIGHER

2 RENTS.—At the request of the owner of a 

3 multifamily housing project for a contract 

4 for assistance in accordance with this sub5 paragraph to establish rents at levels above 

6 those permitted by subparagraph (H) of 

7 this paragraph, a public housing agency 

8 may request, and the Secretary may ap9 prove, higher unit rents if necessary to 

10 preserve housing opportunities that further 

11 the purposes of subsection (t)(4)(E). 

12 ‘‘(iii) PROJECTS IN MULTIPLE PHA

13 JURISDICTIONS.—If the Secretary has not 

14 entered into a contract with a public hous15 ing agency to provide enhanced voucher as16 sistance under subsection (t) for the 

17 project at the time the owner of a multi18 family housing project requests assistance 

19 in accordance with this subparagraph, and 

20 the project is located within the jurisdic21 tion for the program under this subsection 

22 of more than one public housing agency, in 

23 determining which agency will administer 

24 such assistance, the Secretary shall— 


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1 ‘‘(I) consider the ratio of the 

2 number of vouchers to be awarded 

3 under this subparagraph and of other 

4 project-based vouchers administered 

5 under this paragraph to the total 

6 number of vouchers administered by 

7 an agency; and 

8 ‘‘(II) among other factors, pro9 vide preference to an agency for which 

10 the total number of project-based 

11 vouchers administered under this 

12 paragraph, including vouchers to be 

13 awarded pursuant to this subpara14 graph, would not exceed 50 percent of 

15 the total number of all vouchers to be 

16 administered by the agency after such 

17 award. 

18 The Secretary shall establish guidelines for 

19 determining which agency will administer 

20 assistance if a unit is not located within 

21 the jurisdiction of any public housing agen22 cy that administers vouchers. 

23 ‘‘(iv) INAPPLICABILITY OF GOALS.— 

24 Subparagraph (C) shall not apply to a 


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1 housing assistance payment contract pur2 suant to this subparagraph. 

3 ‘‘(v) DISREGARD OF ASSISTANCE

4 UNDER PERCENTAGE LIMITATION.— 

5 Amounts provided pursuant to this sub6 paragraph shall not be considered for pur7 poses of calculating the limitation under 

8 subparagraph (B). 

9 ‘‘(vi) INAPPLICABILITY OF INCOME10 MIXING REQUIREMENT.—Subparagraph 

11 (D) shall not apply with respect to a hous12 ing assistance payments contract pursuant 

13 to this subparagraph.’’. 

14 SEC. 105. PRESERVATION OF STATE-FINANCED AFFORD15 ABLE HOUSING. 

16 (a) MAXIMUM CONTRACT TERM.—In the case of a 

17 State housing finance agency that has entered into a hous18 ing assistance payments contract with the owner of a 

19 housing project for project-based rental assistance under 

20 section 8 of the United States Housing Act of 1937 (42 

21 U.S.C. 1437f), using the November 1975 version of form 

22 HUD 52645A of the Department of Housing and Urban 

23 Development, under the Section 8 Housing Assistance 

24 Payment Program for State Housing Finance and Devel25 opment Agencies, if such contract provides that the maxVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00042 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 imum total term of the contract for any dwelling unit shall 

2 not exceed a period terminating on the date of the last 

3 payment of principal due on the permanent financing, the 

4 Secretary of Housing and Urban Development shall treat 

5 such provision as providing for a maximum term extending 

6 to the originally scheduled maturity date of the permanent 

7 financing, without regard to any prepayment of such per8 manent financing. 

9 (b) AMENDMENT TO MARK-TO-MARKET PROVI10 SIONS.—Section 524 of the Multifamily Assisted Housing 

11 Reform and Affordability Act of 1997 is amended— 

12 (1) by redesignating subsection (g) as sub13 section (i); and 

14 (2) by inserting after subsection (f) the fol15 lowing new subsection: 

16 ‘‘(g) STATE HOUSING AGENCY CONTRACTS.— 

17 ‘‘(1) RENT ADJUSTMENTS FOR EXTENDED CON18 TRACTS.—In the case of a contract for project-based 

19 assistance under section 8 of the United States 

20 Housing Act of 1937 pursuant to the State Housing 

21 Agencies program governed by part 883 of the Sec22 retary’s regulations (24 C.F.R. 883), the provisions 

23 of this section authorizing the increase of rent levels 

24 to comparable market rents shall apply upon the ex25 piration of any contract term, notwithstanding the 


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1 renewal provisions of the contract. If, at any time 

2 during the five-year period ending upon the final ex3 piration date of any such contract, the owner of the 

4 housing project assisted under the contract enters 

5 into a binding commitment to renew the contract at 

6 the rent levels authorized under subsection (a)(4)(A) 

7 for an additional five-year term beginning upon the 

8 final expiration of the contract, the annual rent ad9 justment during such five-year period ending upon 

10 such final expiration date may be to such rent levels. 

11 ‘‘(2) PROJECTS WITH DEBT FINANCING.—In 

12 the case of a contract for project-based assistance 

13 under section 8 for a project with debt financing 

14 provided by a State housing agency or local housing 

15 authority, with the approval of the State housing 

16 agency or local authority, the owner may terminate 

17 the contract and enter into a new contract for 

18 project-based assistance under this section for a 

19 term of 20 years, subject to the availability of 

20 amounts provided by appropriation Acts, but only if 

21 the owner enters into an enforceable commitment to 

22 preserve the affordability of the project for not fewer 

23 than 55 years from the date of such contract, sub24 ject to the continued provision of rental assistance 

25 under section 8 or a comparable program.’’. 


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1 SEC. 106. PRESERVATION EXCHANGE PROGRAM. 

2 (a) ESTABLISHMENT OF PROGRAM.—The Secretary 

3 of Housing and Urban Development shall carry out a pres4 ervation exchange program under this section to provide 

5 for the transfer of preservation projects to purchasers who 

6 agree to maintain the projects for use for affordable hous7 ing. 

8 (b) PARTICIPATION.— 

9 (1) ELECTION.—The Secretary shall provide for 

10 owners of preservation projects to elect, in accord11 ance with such procedures as the Secretary shall es12 tablish, to participate in the preservation exchange 

13 program under this section. 

14 (2) TRANSFER OF PRESERVATION PROJECTS.— 

15 A selling owner of a preservation project may, in ac16 cordance with this section, enter into a contract for 

17 transfer of the project to a preservation purchaser 

18 during the 12-month period beginning upon such 

19 election. 

20 (3) OFFER PERIOD.—A selling owner of a pres21 ervation project shall agree not to sell, transfer, or 

22 further encumber the preservation project during the 

23 period of the owner’s participation in the program, 

24 with respect to such project, except as otherwise pro25 vided in this section. 


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1 (4) COMPLIANCE WITH PROGRAM REQUIRE2 MENTS.—Except as otherwise provided by the Sec3 retary, a preservation project may be sold under the 

4 program only if all of the parties to the transaction 

5 comply with the requirements of this section. 

6 (c) NOTICE OF PARTICIPATION AND CERTIFI7 CATION.— 

8 (1) RECIPIENTS; TIMING.—Each selling owner 

9 shall of a preservation project shall— 

10 (A) not later than the date that is 12 

11 months before the date of maturity or expira12 tion of the mortgage on the preservation 

13 project, provide written notice of election to 

14 participate in the program with respect to the 

15 project to— 

16 (i) the Secretary; 

17 (ii) each tenant of the project; 

18 (iii) any public housing agency or 

19 other organization representing tenants of 

20 the preservation project; and 

21 (iv) qualified State and local authori22 ties; and 

23 (B) post such notice conspicuously in the 

24 common area of the preservation project for the 

25 duration of the 12-month period beginning on 


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1 the date that notice is required to be provided 

2 pursuant to subparagraph (A). 

3 (2) CONTENTS.—Notice required under sub4 paragraph (A) shall— 

5 (A) include a statement that the selling 

6 owner has elected to participate in the preserva7 tion exchange program and to seek a contract 

8 for sale of the preservation project to a preser9 vation purchaser within the 12-month period 

10 following the date of the notice, or within such 

11 other time period as permitted by this section; 

12 (B) clearly identify the preservation 

13 project; 

14 (C) identify, and provide contact informa15 tion for, the selling owner; and 

16 (D) include such other information regard17 ing the preservation project and its potential 

18 sale under the program as the Secretary may 

19 require, which shall include information con20 cerning any applicable subsidies or restrictions 

21 applicable to the preservation project. 

22 (3) CERTIFICATION.—Not later than 7 days 

23 after completion of all notice requirements of para24 graph (1) with respect to a preservation project, the 

25 selling owner shall certify in writing to the Secretary 


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1 that notice to all recipients has been provided as re2 quired under this section. 

3 (4) NOTIFICATION TO CONGRESS AND PUB4 LIC.—Not later than 14 days after certification pur5 suant to paragraph (3) is provided to the Secretary 

6 regarding a preservation project, the Secretary 

7 shall— 

8 (A) provide to the Member of the House of 

9 Representatives representing the district in 

10 which the project is located, and to the Mem11 bers of the Senate for the State in which the 

12 project is located, a copy of such notice and cer13 tification; and 

14 (B) make such notice and certification 

15 publicly available at an easily identifiable World 

16 Wide Web location of the Department of Hous17 ing and Urban Development. 

18 (d) OPPORTUNITY TO PURCHASE.— 

19 (1) NOTIFICATION; OFFER.—During the offer 

20 period referred to in subsection (b)(3) with respect 

21 to a preservation project— 

22 (A) the Secretary shall post on an easily 

23 identifiable World Wide Web location of the De24 partment of Housing and Urban Development 

25 information that identifies the preservation 


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1 project as eligible for purchase or transfer pur2 suant to the preservation exchange program, 

3 additional information about the property, as 

4 determined by the Secretary, and the identity of 

5 a contact person on behalf of the selling owner 

6 who may be contacted by a potential preserva7 tion purchaser; and 

8 (B) a potential preservation purchaser may 

9 make an offer to purchase the preservation 

10 project, in accordance with the requirements of 

11 this section, by providing the offer, in writing, 

12 to the selling owner and a copy of the offer to 

13 the Secretary. 

14 (2) DETERMINATION OF BONA FIDE OFFER.— 

15 During the 21-day period beginning upon receipt of 

16 a copy of an offer to purchase a preservation project 

17 made by a potential preservation purchaser pursuant 

18 to paragraph (1)(B) (in this subsection referred to 

19 as the ‘‘review period’’), the Secretary shall— 

20 (A) review the terms of the offer to pur21 chase and determine whether it is a bona fide 

22 preservation purchase offer meeting the require23 ments of subsection (e); and 

24 (B) provide notice of such determination to 

25 the parties. 


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1 If the parties do not receive such notice of such de2 termination from the Secretary during the review pe3 riod, notwithstanding subsection (i)(1), the offer 

4 shall be considered for purposes of this section to be 

5 a bona fide preservation purchase offer. 

6 (3) TOLLING OF OTHER PERIODS.—During the 

7 review period for an offer to purchase a preservation 

8 project or until earlier receipt of a determination 

9 from the Secretary under paragraph (2), all other 

10 time periods set forth in this section shall be tolled 

11 with respect to such preservation project. 

12 (4) ACTION ON OFFER.—With respect to a bona 

13 fide offer to purchase a preservation project made by 

14 a potential preservation purchase, during the 30-day 

15 period that begins upon the earlier of the receipt of 

16 a determination from the Secretary under paragraph 

17 (2) regarding the offer or the expiration of the re18 view period, the selling owner shall accept or reject 

19 the offer, subject to the conditions and requirements 

20 set forth in this section. 

21 (5) ACCEPTED OFFER; CONTRACT.—If a selling 

22 owner accepts a bona fide preservation purchase 

23 offer made by a potential preservation purchaser, 

24 such parties shall promptly enter into a binding con25 tract that reflects the terms of the accepted offer. 


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1 (6) DECLINED OFFER.—If a selling owner de2 clines to accept any bona fide preservation purchase 

3 offer made to the owner, such owner shall— 

4 (A) provide to the Secretary a written ex5 planation of the basis for its decision; and 

6 (B) repay to the Secretary all funds it re7 ceived as a participant in the program, plus in8 terest at rate determined by the Secretary at 

9 the time the funds were made available. 

10 (e) BONA FIDE PRESERVATION PURCHASE

11 OFFER.—An offer to purchase a preservation project shall 

12 constitute a bona fide preservation purchase offer meeting 

13 the requirements of this subsection only if the offer— 

14 (1) includes an agreement by the preservation 

15 purchaser to enter into such agreements, which shall 

16 be contained in the deed or other recorded instru17 ments for the preservation project, as specified by 

18 the Secretary, that ensure that the preservation 

19 project will remain affordable for very-low income 

20 families for a period of not less than 40 years from 

21 the date of transfer pursuant to sale under such 

22 offer, utilizing all available assistance, including re23 newal of existing Federal assistance contracts and 

24 leasing to holders of tenant-based assistance; 


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1 (2) includes an agreement by the preservation 

2 purchaser to accept any contract for project-based 

3 rental assistance applicable to the preservation 

4 project, notwithstanding the transfer of the preser5 vation housing to the preservation purchaser, includ6 ing the renewal of such contract upon expiration, for 

7 a period of not less than 40 years from the date of 

8 transfer; 

9 (3) requires that the preservation purchaser 

10 execute such agreements, which shall be contained in 

11 the deed or other recorded instruments for the pres12 ervation housing, as specified by the Secretary, that 

13 ensure that the preservation project and related fa14 cilities will remain affordable for very-low income 

15 households for a period of not less that 40 years 

16 from the date of transfer, using all available assist17 ance, including renewal of existing Federal assist18 ance contracts and leasing to holders of tenant19 based assistance; and 

20 (4) includes such other terms and conditions as 

21 may be required by the Secretary. 

22 (f) INCENTIVES.—Notwithstanding any other provi23 sion of law or regulation, the Secretary may, with respect 

24 to a preservation project— 


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1 (1) suspend physical inspections and manage2 ment reviews of the project, during the period that 

3 begins upon the provision to the Secretary by the 

4 selling owner notice of its election to participate in 

5 the program and ending upon the completion of the 

6 transfer of the preservation project to a preservation 

7 purchaser or termination of participation of the sell8 ing owner in the program; 

9 (2) streamline approval of requests for prepay10 ment, assignment of Housing Assistance Payments 

11 contracts, transfer of physical assets, and other ac12 tivities and functions, to facilitate the sale or trans13 fer under the program to a preservation purchaser; 

14 (3) release project resources, in the form of re15 serve for replacement funds or project residual re16 ceipts, to the selling owner for purposes related to 

17 preparation of the preservation project for sale 

18 under the program, applicable pre-development 

19 costs, or transaction costs related to sale or transfer 

20 of the preservation project under the program; 

21 (4) provide advances in the form of a forgivable 

22 loan for the selling owner to be used for direct 

23 predevelopment and administrative costs for prepa24 ration of the preservation project for sale under the 

25 program, and the transfer of the preservation 


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1 project to the preservation purchaser, but not in2 cluding compensation for property value beyond the 

3 purchase price; 

4 (5) provide grants or loans to a preservation 

5 purchaser who has entered into a bona fide preserva6 tion purchase contact under the program with the 

7 selling owner, which grant or loan funds shall be 

8 used for to purchase or rehabilitate the preservation 

9 project; and 

10 (6) provide grants or loans pursuant to section 

11 102(a) of this Act to a preservation purchaser who 

12 has entered into a bona fide preservation purchase 

13 contract under the program with the selling owner. 

14 (g) RELEASE OF SELLING OWNER.—Upon closing of 

15 the sale or transfer of the preservation project pursuant 

16 to this section— 

17 (1) the selling owner shall be released from obli18 gations with respect to the preservation project 

19 under— 

20 (A) the new construction, substantial reha21 bilitation, moderate rehabilitation, property dis22 position, and loan management set-aside pro23 grams, and any other program providing 

24 project-based assistance, under section 8 of the 


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

2 1437f); 

3 (B) the below-market interest rate pro4 gram under paragraphs (3) and (5) of section 

5 221(d)(3) of the National Housing Act (12 

6 U.S.C. 1715(d)); 

7 (C) section 236 of the National Housing 

8 Act (12 U.S.C. 1715z–1); 

9 (D) section 202 of the Housing Act of 

10 1959 (12 U.S.C. 1701q); 

11 (E) the rent supplement program under 

12 section 101 of the Housing and Urban Develop13 ment Act of 1965 (12 U.S.C. 1701s); or 

14 (F) other Federal affordable housing pro15 grams, as identified by the Secretary; and 

16 (2) the preservation purchaser agrees— 

17 (A) to operate the preservation project in 

18 accordance with the provisions of this section 

19 and any agreements entered into pursuant to 

20 this section; and 

21 (B) to maintain any existing limits or re22 strictions on the amount of tenant rents, rent 

23 contributions, or income eligibility of tenants, or 

24 on the use of the preservation project, as re25 quired by the Secretary, for a period of not less 


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1 than 40 years from the transfer date, except 

2 that rents may be increased to the extent that 

3 additional project-based assistance is provided 

4 by the Secretary. 

5 (h) RENEWAL OF PARTICIPATION IN PROGRAM.— 

6 (1) IN GENERAL.—A selling owner who has 

7 participated in the program in good faith for 12 

8 months and does not receive or does not reject a 

9 bona fide preservation purchase offer during that 

10 12-month period of participation may seek approval 

11 of the Secretary to renew its participation for an ad12 ditional 12-month period. A request for renewal 

13 under this paragraph shall be subject to the same 

14 provisions of subsection (c) applicable to a notice of 

15 election to participate in the program. 

16 (2) TIMING.—A request for renewal may be 

17 made, but shall not be required to be made, imme18 diately upon the expiration of the selling owner’s ini19 tial 12-month period of participation in the program. 

20 (3) APPROVAL.—The Secretary may, at the dis21 cretion of the Secretary, approve or reject a renewal 

22 request under this subsection. A renewal request 

23 that is not accepted or rejected by the Secretary 

24 during the 30-day period beginning upon receipt of 


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1 the request by the Secretary shall be considered for 

2 purposes of this section to have been accepted. 

3 (4) TERMS.—A selling owner who renews par4 ticipation in the program shall be subject to the re5 quirements and procedures for participation under 

6 this section for the initial term of participation. 

7 (i) DEFINITIONS.—For purposes of this section, the 

8 following definitions shall apply: 

9 (1) BONA FIDE PRESERVATION PURCHASE

10 OFFER.—The term ‘‘bona fide preservation purchase 

11 offer’’ means an offer to purchase a preservation 

12 project that has been determined by the Secretary, 

13 pursuant to subsection (d)(2) to meet the require14 ments under subsection (e). 

15 (2) ELIGIBLE JURISDICTION.—The term ‘‘eligi16 ble jurisdiction’’ means an area so designated by the 

17 Secretary for purposes of this section. 

18 (3) PRESERVATION CONTRACT.—The term 

19 ‘‘preservation contract’’ means any contract for sale 

20 or transfer of a preservation project pursuant to the 

21 provisions of this section. 

22 (4) PRESERVATION EXCHANGE PROGRAM.—The 

23 terms ‘‘preservation exchange program’’ and ‘‘pro24 gram’’ mean the preservation exchange program auVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00057 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 thorized by, and established pursuant to, this sec2 tion. 

3 (5) PRESERVATION PROJECT.—The term ‘‘pres4 ervation project’’ means any multifamily housing 

5 project that— 

6 (A) has been specifically identified to the 

7 Secretary by a selling owner as available for 

8 purchase or transfer under the preservation ex9 change program; 

10 (B) is located in an eligible jurisdiction; 

11 (C) is financed by a loan or mortgage that 

12 will mature or expire within 5 years of the elec13 tion by the selling owner to participate in the 

14 preservation exchange program; and 

15 (D) is insured or assisted under— 

16 (i) the new construction, substantial 

17 rehabilitation, moderate rehabilitation, 

18 property disposition, and loan management 

19 set-aside programs, or any other program 

20 providing project-based assistance, under 

21 section 8 of the United States Housing Act 

22 of 1937 (42 U.S.C. 1437f); 

23 (ii) the below-market interest rate 

24 program under paragraphs (3) and (5) of 


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1 section 221(d)(3) of the National Housing 

2 Act (12 U.S.C. 1715(d)); 

3 (iii) section 236 of the National Hous4 ing Act (12 U.S.C. 1715z–1); 

5 (iv) section 202 of the Housing Act of 

6 1959 (12 U.S.C. 1701q); 

7 (v) the rent supplement program 

8 under section 101 of the Housing and 

9 Urban Development Act of 1965 (12 

10 U.S.C. 1701s); or 

11 (vi) any other Federal affordable 

12 housing program, as identified by the Sec13 retary. 

14 (6) PRESERVATION PURCHASER.—The term 

15 ‘‘preservation purchaser’’ means any person or enti16 ty that acquires a preservation project pursuant to 

17 an agreement to participate in the preservation ex18 change program. 

19 (7) SECRETARY.—The term ‘‘Secretary’’ means 

20 the Secretary of Housing and Urban Development. 

21 (8) SELLING OWNER.—The term ‘‘selling 

22 owner’’ means, with respect to a preservation 

23 project, the person or entity that owns the project 

24 and that has elected to participate in the preserva25 tion exchange program with respect to such project. 


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1 (j) EFFECT OF PARTICIPATION.—During the time 

2 that the owner is participating in the preservation ex3 change program with respect to a preservation project, 

4 such owner and such project shall not be subject to the 

5 requirements under section 107 of this Act. 

6 (k) AUTHORIZATION OF APPROPRIATIONS.—There 

7 are authorized to be appropriated to the Secretary such 

8 sums as may be necessary to carry out this section, includ9 ing amounts for the provision of additional educational 

10 services and training and technical assistance and to pro11 vide information to the public and to potential participants 

12 in the preservation exchange program to facilitate partici13 pation in the program, and for other activities to promote 

14 the preservation of affordable housing. 

15 (l) REGULATIONS.—The Secretary shall issue any 

16 regulations necessary to carry out this section. 

17 SEC. 107. FEDERAL FIRST RIGHT OF REFUSAL. 

18 (a) NOTICE OF TERMINATION OF AFFORDABILITY

19 RESTRICTIONS.— 

20 (1) NOTICE OF TERMINATION.— 

21 (A) REQUIREMENT.—Except as provided 

22 in subparagraph (D), an owner of covered hous23 ing shall provide written notice under subpara24 graph (B) of any termination of the afford25 ability restrictions affecting the covered housVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00060 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 ing, not later than one year, but no earlier than 

2 three years, before such termination to— 

3 (i) all tenants and the resident coun4 cil, if any, of the covered housing; 

5 (ii) the State housing agency or com6 parable State agency of the State in which 

7 the housing is located; and 

8 (iii) the Secretary. 

9 Nothing in this section shall prohibit an owner 

10 from taking actions to terminate an afford11 ability restriction during any notice period 

12 under this section; except that an owner shall 

13 comply with all of the notice terms and restric14 tions pursuant to paragraphs (2) and (3). 

15 (B) CONTENTS.—Written notice under this 

16 subparagraph with respect to covered housing 

17 shall include— 

18 (i) the address of the covered housing; 

19 (ii) the name and address of the 

20 owner; 

21 (iii) a statement identifying that an 

22 affordability restriction may terminate; 

23 (iv) the date on which each afford24 ability restriction may terminate; and 


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1 (v) such other information as may be 

2 required by the Secretary. 

3 (C) SINGLE NOTICE COVERING MULTIPLE

4 TERMINATIONS.—In any case in which more 

5 than one termination is scheduled to occur 

6 within a 12-month period, an owner may pro7 vide a single written notice covering all such 

8 terminations, but only if the notice is provided 

9 in accordance with subparagraph (A) at least 

10 one year before the earliest such termination 

11 and the notice otherwise complies with this 

12 paragraph. 

13 (D) TRANSITION.—Subparagraph (A) shall 

14 not apply with respect to covered housing sub15 ject to an affordability restriction that, as of 

16 the effective date under subsection (j), has less 

17 than two years of applicability remaining. Such 

18 covered housing shall be subject to paragraph 

19 (5). 

20 (2) NOTICE OF INTENT TO COMPLETE TERMI21 NATION.—An owner of covered housing shall not 

22 complete a termination or allow a termination to 

23 occur with respect to such housing unless, not later 

24 than one year before the completion of the last ter25 mination event affecting the covered housing, the 


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1 owner provides the entities identified in paragraph 

2 (1) with written notice of intent to complete such 

3 termination. The notice shall include— 

4 (A) the address of the covered housing; 

5 (B) the name and address of the owner; 

6 (C) the date on which the owner intends to 

7 complete termination; and 

8 (D) such other information as may be re9 quired by the Secretary. 

10 (3) OPPORTUNITY FOR PURCHASE BY SEC11 RETARY.—Except as provided in subsection (d), an 

12 owner of covered housing shall not sell the covered 

13 housing at any time before— 

14 (A) providing notice, in writing, to the par15 ties identified in paragraph (1) of the owner’s 

16 intention to sell the property; and 

17 (B) offering the Secretary the opportunity 

18 to purchase the property pursuant to subsection 

19 (b). 

20 (4) DELIVERY OF NOTICE.— 

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

22 subparagraph (B), any notice required by this 

23 subsection shall be deemed to have been pro24 vided when delivered in person or mailed by cer25 tified or registered mail, return receipt reVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00063 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 quested, to the party to whom notice is re2 quired. 

3 (B) NOTICE TO TENANT.—With respect to 

4 any notice to tenants required by this sub5 section, any such notice shall be deemed to have 

6 been provided upon the when— 

7 (i) the notice is delivered in hand to 

8 the tenant or an adult member of the ten9 ant’s household; 

10 (ii) the notice is sent by first class 

11 mail; or 

12 (iii) a copy is left in or under the door 

13 of the tenant’s dwelling unit. 

14 (5) TRANSITION.—Notwithstanding paragraph 

15 (1) of this subsection, an owner of covered housing 

16 who, on the effective date under subsection (j), has 

17 less than one year remaining before the date when 

18 the affordability restriction will cease to apply to 

19 such housing, shall not be required to give the one20 year notice required by paragraph (1), but shall pro21 vide such notice within 90 days after the effective 

22 date under subsection (j). Notwithstanding para23 graph (2) of this subsection, an owner who, on the 

24 effective date under subsection (j), has less than one 

25 year remaining before a termination shall not be reVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00064 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 quired to give the one-year notice required by para2 graph (2), but shall provide such notice within 90 

3 days after such effective date. 

4 (6) EFFECT OF OFFER, PURCHASE, OR SALE.— 

5 The notice requirements of this subsection shall not 

6 be affected by the status of an offer, purchase con7 tract, or sale under subsection (b) or (c). 

8 (b) RIGHT OF SECRETARY TO MAKE OFFER.— 

9 (1) OPPORTUNITY FOR PURCHASE BY SEC10 RETARY.—An owner of covered housing shall offer 

11 the Secretary an opportunity to purchase the cov12 ered housing, in accordance with this subsection, be13 fore entering into any agreement to sell such hous14 ing to a third party. This paragraph may not be 

15 construed to establish any obligation on the part of 

16 an owner of covered housing to enter into an agree17 ment to sell such housing to the Secretary. 

18 (2) ASSIGNEE OF SECRETARY.— 

19 (A) AUTHORITY TO SELECT.—The Sec20 retary may select an assignee to act on behalf 

21 of the Secretary under this subsection as the 

22 purchaser of covered housing and shall give the 

23 owner written notice of any assignee selected. 

24 (B) AGREEMENT.—The Secretary shall 

25 enter into a written agreement with any asVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00065 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 signee selected, which shall provide that the as2 signee, and any of its successors or assigns, 

3 agree to preserve the affordability of the cov4 ered housing. Upon entering into such an 

5 agreement, the assignee shall assume all rights 

6 and responsibilities of the Secretary as a pro7 spective purchaser under this subsection and 

8 subsection (c). 

9 (C) REVOCATION.—At any time before a 

10 sale of covered housing under this subsection or 

11 subsection (d), the Secretary may revoke the se12 lection and designation of an assignee with re13 spect to the covered housing pursuant to this 

14 paragraph and assume the rights and respon15 sibilities in the Secretary’s own capacity or se16 lect a new assignee and enter into an agreement 

17 under subparagraph (B) with such assignee. No 

18 action under this subparagraph shall operate to 

19 extend or alter any time periods for perform20 ance under this section or in any purchase con21 tract entered into pursuant to this section. 

22 (3) PURCHASE OFFER.— 

23 (A) TIMING.—During the 90-day period 

24 with respect to covered housing that begins 

25 upon receipt of notice pursuant to subsection 


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1 (a)(3) of the owner’s intention to sell the cov2 ered housing, the Secretary may submit an 

3 offer to the owner to purchase the covered 

4 housing. 

5 (B) FAILURE TO SUBMIT.—Failure by the 

6 Secretary to submit an offer to purchase cov7 ered housing during the period under subpara8 graph (A) shall constitute an irrevocable waiver 

9 of the Secretary’s rights under this subsection 

10 and the owner may sell the covered housing 

11 subject to subsection (c). 

12 (C) ACCEPTANCE.—If the owner accepts 

13 the initial or any revised offer of the Secretary, 

14 the owner and the Secretary shall enter into 

15 such other agreements as are necessary and ap16 propriate to complete the purchase. If the 

17 owner and the Secretary have not entered into 

18 an agreement for the Secretary to purchase the 

19 property within 90 days after receipt of the no20 tice pursuant to subsection (a)(3), the owner 

21 may enter into an agreement to sell the prop22 erty to a purchaser of the owner’s choice, sub23 ject to subsection (c). 

24 (4) AVAILABILITY OF DOCUMENTS.— 


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1 (A) REQUIREMENT.—If the Secretary 

2 makes a request pursuant to this subparagraph 

3 to the owner of covered housing at any time 

4 after notice required under subsection (a)(1) 

5 has been provided, the owner shall, within 10 

6 days after receiving the request, make the docu7 ments described in subparagraph (B) available 

8 to the Secretary for review and photocopying 

9 during normal business hours at the owner’s 

10 principal place of business or at a commercial 

11 photocopying facility. 

12 (B) COVERED DOCUMENTS.—The docu13 ments described in this subparagraph with re14 spect to covered housing shall include— 

15 (i) any existing architectural plans 

16 and specifications of the covered housing; 

17 (ii) itemized lists of monthly operating 

18 expenses and capital expenditures for the 

19 covered housing in each of the two pre20 ceding calendar years; 

21 (iii) any capital needs studies or mar22 ket studies for the covered housing that 

23 have been submitted to a Federal, State, 

24 or local agency in the preceding three 

25 years; 


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1 (iv) utility consumption rates for the 

2 covered housing for preceding year; 

3 (v) the last two audited annual finan4 cial statements and physical inspection re5 ports for the covered housing filed with 

6 Federal, State, or local agencies; 

7 (vi) the most recent rent roll for the 

8 covered housing showing then-current va9 cancies and rent arrearages; 

10 (vii) a statement of the approximate 

11 annualized vacancy rate for the covered 

12 housing for each of the two preceding cal13 endar years; and 

14 (viii) any other documents relating to 

15 the covered housing that the Secretary 

16 considers appropriate. 

17 (C) PROTECTION OF INFORMATION.—Doc18 uments obtained pursuant to a request under 

19 this paragraph shall not be considered public 

20 records, and the Secretary shall not make such 

21 documents available to the public without the 

22 written consent of the owner or pursuant to a 

23 court order, except that disclosure of such docu24 ments may be made to potential funding 

25 sources, regulatory agencies, or agents or conVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00069 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 sultants of the Secretary in connection with a 

2 purchase transaction pursuant to this sub3 section, subject to appropriate confidentiality 

4 agreements. 

5 (5) INSPECTIONS.— 

6 (A) IN GENERAL.—Subject to execution of 

7 an access and confidentiality agreement in ac8 cordance with subparagraph (B), upon request 

9 by the Secretary and with appropriate notice, 

10 the owner shall permit reasonable inspections of 

11 the dwelling units, building systems, common 

12 areas, and common grounds of the covered 

13 housing by agents, consultants, and representa14 tives of the Secretary or the assignee of the 

15 Secretary, including inspections related to envi16 ronmental, engineering, structural, or zoning 

17 matters. 

18 (B) ACCESS AND CONFIDENTIALITY

19 AGREEMENT.—An access and confidentiality 

20 agreement in accordance with this subpara21 graph is an agreement, entered into by the 

22 owner of covered housing and any agents, con23 sultants, or representatives of the Secretary or 

24 the assignee of the Secretary, in a form ap25 proved by the Secretary, with respect to such 


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1 matters as insurance to be carried by the in2 spectors of the covered housing, indemnities of 

3 the owner, restrictions on invasive testing, res4 toration requirements, the timing of such in5 spections, and the requirement to maintain con6 fidentiality with respect to all matters discov7 ered. 

8 (6) NOTIFICATION TO TENANTS.—Not later 

9 than 30 days after the Secretary submits an offer to 

10 purchase the covered housing pursuant to subsection 

11 (c), the Secretary shall notify tenants in the housing 

12 development of its plans. 

13 (c) FIRST RIGHT OF REFUSAL.— 

14 (1) SALE TO THIRD PARTY.—An owner of cov15 ered housing may execute a purchase contract with 

16 a third party to sell the covered housing pursuant to 

17 this subsection during the one-year period that be18 gins upon the date on which notice for such housing 

19 was provided to the Secretary pursuant to sub20 section (a)(3). After such period expires, the owner 

21 may not sell the housing without providing notice of 

22 such sale in accordance with subsection (a)(3)(A). 

23 (2) MATCHING OF THIRD PARTY OFFER BY

24 SECRETARY OR OTHER PARTY.— 


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1 (A) NOTICE OF THIRD PARTY PURCHASE

2 CONTRACT.—Upon execution of a third party 

3 purchase contract for covered housing, the 

4 owner shall, within 7 days, submit a copy of the 

5 contract to the Secretary, the resident council, 

6 if any, all tenants, and the State housing agen7 cy. 

8 (B) PURCHASE BY SECRETARY AND AS9 SIGNMENT OF RIGHT TO MATCH OFFER.—In 

10 the case of covered housing for which a third 

11 party purchase contract is executed, the Sec12 retary may— 

13 (i) elect to purchase the housing 

14 under a contract under subparagraph (D); 

15 or 

16 (ii) assign the right to match the 

17 third party offer for the covered housing 

18 under a contract under subparagraph (D). 

19 If the Secretary elects to take action under 

20 clause (i) or (ii), the Secretary shall take such 

21 action, or execute such other agreement as is 

22 acceptable to the owner and the Secretary, dur23 ing the 30-day period that begins upon receipt 

24 by the Secretary of a copy of the third party 

25 purchase contract. 


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1 (C) EXTENSION OF TIME PERIODS.—The 

2 time periods set forth in this paragraph may be 

3 extended by agreement between the owner and 

4 the Secretary. 

5 (D) TERMS OF MATCHING CONTRACT.— 

6 The purchase contract between the owner and 

7 the Secretary or the Secretary’s assignee pursu8 ant to this paragraph shall contain the same 

9 material terms and conditions as the executed 

10 third party purchase contract, except that the 

11 purchase contract between the owner and the 

12 assignee shall provide at least the following 

13 terms: 

14 (i) AMOUNT OF EARNEST MONEY DE15 POSIT.—The amount of the earnest money 

16 deposit shall not exceed the lesser of— 

17 (I) the amount of the deposit 

18 provided under the third party pur19 chase contract; 

20 (II) 2 percent of the sale price; 

21 or 

22 (III) $250,000. 

23 (ii) ESCROW OF EARNEST MONEY DE24 POSIT.—The earnest money deposit shall 

25 be held under commercially reasonable 


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1 terms by an escrow agent selected jointly 

2 by the owner and the Secretary or the as3 signee of the Secretary. 

4 (iii) REFUNDING OF EARNEST MONEY

5 DEPOSIT.—The earnest money deposit 

6 shall be refundable for not less than 90 

7 days from the date of execution of the pur8 chase contract or such longer period as 

9 provided for in the third party purchase 

10 contract; except that if the owner unrea11 sonably delays the buyer’s ability to con12 duct due diligence during the 90-day pe13 riod, the earnest money deposit shall con14 tinue to be refundable for a period greater 

15 than 90 days. 

16 (iv) TIME FOR PERFORMANCE.—The 

17 time for performance shall be no sooner 

18 than 240 days after the date of the execu19 tion of the purchase contract, or such later 

20 date provided for in the third party pur21 chase contract. 

22 (3) FAILURE TO EXECUTE PURCHASE CON23 TRACT BY SECRETARY OR ASSIGNEE.—If the Sec24 retary, or the assignee, fails to execute a proposed 

25 purchase contract during the 30-day period under 


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1 paragraph (2)(B) (as such period may be extended 

2 pursuant to paragraph (2)(C)), the owner may, dur3 ing the 2-year period beginning upon expiration of 

4 such 30-day (or extended) period, complete a sale of 

5 the owner’s covered housing to a third party, except 

6 as provided in paragraph (5). After the expiration of 

7 such 2-year period, the owner may not sell the hous8 ing without, after such expiration, complying with 

9 paragraph (3) of subsection (a) and with this sub10 section. 

11 (4) FAILURE TO PERFORM PURCHASE CON12 TRACT BY SECRETARY OR ASSIGNEE.—If the Sec13 retary, or the assignee, executes the proposed pur14 chase contract as provided in paragraph (2) but fails 

15 to perform as provided in the executed purchase con16 tract, the owner may, during the 2-year period be17 ginning upon the date on which the executed pur18 chase contract terminated, complete a sale of the 

19 owner’s covered housing to a third party. After the 

20 expiration of such 2-year period, the owner may not 

21 sell the housing without, after such expiration, com22 plying with paragraph (3) of subsection (a) and with 

23 this subsection. 

24 (5) COUNTEROFFER.— 


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1 (A) OPPORTUNITY.—After receipt of the 

2 third party purchase contract provided for in 

3 paragraph (2), the Secretary may, during the 

4 30-day period under paragraph (2), make a 

5 counteroffer by executing and submitting to the 

6 owner an amended proposed purchase contract, 

7 or by assigning the right to make such a 

8 counteroffer to an assignee. 

9 (B) ASSIGNMENT.—If the Secretary as10 signs the right under subparagraph (A) to 

11 make a counteroffer, the assignee may, during 

12 the 15-day period that begins upon such assign13 ment or the remaining period remaining in the 

14 30-day period under paragraph (2), whichever 

15 is longer, make such a counteroffer. 

16 (C) FAILURE BY SECRETARY TO EXECUTE

17 OR ASSIGN.—Failure by the Secretary to exe18 cute or assign the purchase contract or submit 

19 a counteroffer during the 30-day period under 

20 paragraph (2) shall constitute a waiver of the 

21 Secretary’s right to purchase under this sub22 section. 

23 (D) PERIOD FOR OWNER RESPONSE.—If 

24 the Secretary or an assignee submits a 

25 counteroffer pursuant to this paragraph, the 


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1 owner may, during the 30-day period beginning 

2 upon receipt of the amended proposed purchase 

3 contract, execute the amended proposed pur4 chase contract or reject the counteroffer in 

5 writing. 

6 (E) REJECTION BY OWNER.—If the owner 

7 rejects the counteroffer, the owner may, during 

8 the 2-year period beginning on the date of such 

9 rejection, complete a sale of the covered housing 

10 to a third party. If such sale is upon economic 

11 terms and conditions that are the same as, or 

12 materially more favorable to the proposed pur13 chaser than, the economic terms and conditions 

14 in the proposed purchase contract offered by 

15 the Secretary or assignee in the Secretary’s or 

16 assignee’s counteroffer, the owner shall, within 

17 7 days after such execution, provide a copy of 

18 the new third party purchase contract, along 

19 with a proposed purchase contract for execution 

20 by the Secretary or assignee, which shall con21 tain the same terms and conditions as the exe22 cuted third party purchase contract. The Sec23 retary or assignee may, during the 30-day pe24 riod beginning upon receipt of the third party 

25 purchase contract and the proposed purchase 


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1 contract, execute the proposed purchase con2 tract or such other agreement as is acceptable 

3 to the owner and the Secretary or assignee. 

4 (6) PROVISION OF THIRD PARTY CONTRACT TO

5 SECRETARY.—If any owner executes any purchase 

6 contract with a third party during any of the 2-year 

7 periods referred to paragraph (3), (4), or (5), the 

8 owner shall— 

9 (A) not later than 7 after such execution, 

10 provide the Secretary with a copy of the new or 

11 amended purchase contract executed with re12 spect to the covered housing; and 

13 (B) not later than 7 days after the record14 ing or filing of the deed or other document with 

15 the registry of deeds or the registry district of 

16 the land court of the county in which the af17 fected covered housing is located, provide the 

18 Secretary with a copy of any such deed or other 

19 document transferring the owner’s interest in 

20 the covered housing. 

21 (7) CERTIFICATION BY OWNER.—Any third 

22 party purchase contract, amended third party pur23 chase contract, deed, or any other document trans24 ferring the owner’s interest in covered housing shall 

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1 ment is accurate and complete and that there are no 

2 other agreements between the owner and the third 

3 party buyer, or an affiliate of either, with respect to 

4 the sale of the covered housing. 

5 (d) EXEMPTIONS.— 

6 (1) INAPPLICABILITY OF FIRST RIGHT OF RE7 FUSAL.—Subsection (b) and (c) shall not apply to 

8 any of the following actions: 

9 (A) A government taking of covered hous10 ing by eminent domain or a negotiated pur11 chase in lieu of eminent domain. 

12 (B) A forced sale of covered housing pur13 suant to a foreclosure. 

14 (C) A deed-in-lieu of foreclosure for cov15 ered housing. 

16 (D) A proposed sale of covered housing to 

17 a purchaser pursuant to terms and conditions 

18 that preserve affordability, as determined by 

19 the Secretary (including sales or transfers pur20 suant to section 106 of this Act). 

21 (E) A proposed sale of covered housing— 

22 (i) that the Secretary has determined 

23 was not, as of the effective date under sub24 section (j), receiving Federal assistance nor 

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1 grams identified in subsection (g)(4), other 

2 than the program identified in subsection 

3 (g)(4)(A); and 

4 (ii) under which the buyer has agreed, 

5 as provided in a regulatory agreement, to 

6 renew in whole, all contracts for project7 based assistance under section 8 of the 

8 United States Housing Act of 1937 (42 

9 U.S.C. 1437f) or any successor program 

10 thereto; such renewal shall be subject to 

11 the availability, at the time of such re12 newal, of such assistance to the owner on 

13 economic terms and conditions that are 

14 comparable to the existing project-based 

15 rental assistance contract. 

16 (F) A proposed sale of covered housing to 

17 an affiliate of the owner that is not a termi18 nation, as determined by the Secretary. 

19 (G) A proposed sale of covered housing 

20 with respect to which the first scheduled termi21 nation will occur more than 15 years after the 

22 date of the sale. 

23 (H) A bona fide proposed sale pursuant to 

24 a purchase contract in effect on the effective 

25 date under subsection (j). 


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1 (2) REQUIREMENT TO SUBMIT REQUEST.—The 

2 Secretary shall make a determination that an ex3 emption under subparagraph (D), (E), or (F) of 

4 paragraph (1) applies only pursuant to a written re5 quest for such an exemption submitted by the owner 

6 of the covered housing. Such a request shall include 

7 the name and address of any resident council for the 

8 covered housing. The Secretary shall provide a copy 

9 of the Secretary’s determination under subparagraph 

10 (D), (E), or (F) of paragraph (1) to the owner and 

11 the resident council. 

12 (e) REGULATORY AGREEMENT.—A purchase of cov13 ered housing by the Secretary or an assignee of the Sec14 retary pursuant to this section shall be subject to a regu15 latory agreement. Such a regulatory agreement shall not 

16 contain any terms or conditions that would preclude an 

17 owner or purchaser from participating in, or diminishing 

18 the benefits that an owner would otherwise receive by par19 ticipating in the mark-to-market program of the Depart20 ment under Multifamily Assisted Housing Reform and Af21 fordability Act of 1997 (42 U.S.C. 1437f note). 

22 (f) CERTIFICATE OF COMPLIANCE.— 

23 (1) ISSUANCE.—An owner of covered housing 

24 who has complied with subsections (a), (b), and (c), 

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1 retary or the assignee of the Secretary of the cov2 ered housing, or which has resulted in a sale of the 

3 covered housing pursuant to subsection (c), may 

4 apply to the Secretary for a certificate of compliance 

5 by submitting a written request for the certificate, in 

6 such form and together with such documentation as 

7 the Secretary shall require. The Secretary shall issue 

8 the certificate of compliance within 30 days after re9 ceipt of the application if the Secretary determines 

10 that the owner has complied with said subsections 

11 (a), (b), and (c) and such certificate shall establish 

12 the owner’s compliance to the satisfaction of the 

13 Secretary. 

14 (2) FILING.—An owner obtaining a certificate 

15 of compliance with respect to covered housing shall 

16 file the certificate with the registry of deeds or the 

17 registry district of the land court of the county in 

18 which the covered housing is located not later than 

19 one year after the date of issuance. 

20 (3) PROVISION TO TENANTS.—Upon request by 

21 any tenant of the affected covered housing, the 

22 owner shall provide a copy of the owner’s request for 

23 a certificate of compliance. 

24 (g) RELATIONSHIP WITH OTHER LAWS.—This sec25 tion shall not preempt any State or local law that has esVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00082 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 tablished a right of first refusal to preserve affordable 

2 housing that is on terms and conditions that are com3 parable to this section, establishes such a right after the 

4 effective date under subsection (j). Any covered housing 

5 located in a State or locality with such a right of first 

6 refusal shall not be subject to this section. 

7 (h) DEFINITIONS.—For the purposes of this section, 

8 the following definitions shall apply: 

9 (1) AFFILIATE.—The term ‘‘affiliate’’ means an 

10 entity owned or controlled by an owner or under 

11 common control with the owner. 

12 (2) AFFORDABILITY RESTRICTION.—The term 

13 ‘‘affordability restriction’’ means, with respect to 

14 covered housing, a limit on rents that an owner may 

15 charge for occupancy of a rental unit in the housing 

16 or a limit on tenant income for persons or families 

17 seeking to qualify for admission to such housing. 

18 (3) ASSIGNEE.—The term ‘‘assignee’’ means a 

19 State agency, local or regional housing authority, 

20 nonprofit or for profit corporation, or other entity 

21 qualified to do business in the affected State, that 

22 is selected by the Secretary to operate covered hous23 ing that is decent, safe, and sanitary affordable 

24 housing in a manner to be determined by the Sec25 retary. 


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1 (4) COVERED HOUSING.—The term ‘‘covered 

2 housing’’ means a housing unit or development that 

3 receives Federal assistance under any of the fol4 lowing programs or provisions: 

5 (A) The programs under section 8 of the 

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

7 1437f) for new construction, substantial reha8 bilitation, moderate rehabilitation, property dis9 position, and loan management set-aside, and 

10 any other Federal program providing project11 based rental assistance. 

12 (B) The Federal program for low-income 

13 housing tax credits under section 42 of the In14 ternal Revenue Code of 1986 (26 U.S.C. 42). 

15 (C) The program for rent supplement as16 sistance under section 101 of the Housing and 

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

18 1701s). 

19 (D) Section 202 of the Housing Act of 

20 1959 (12 U.S.C. 1701q). 

21 (E) The below-market interest rate pro22 gram under paragraphs (3) and (5) of 

23 221(d)(3) of the National Housing Act (12 

24 U.S.C. 1715(d) (3) and (5)). 


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1 (F) Section 221(d)(4) of the National 

2 Housing Act (12 U.S.C. 1715(d)(4)), to the ex3 tent the project’s rents are restricted pursuant 

4 to a government agreement. 

5 (G) A contract under section 236(f)(2) of 

6 the National Housing Act (12 U.S.C. 1715z– 

7 1(f)(2)). 

8 (H) Section 236 of the National Housing 

9 Act (12 U.S.C. 1715z–1) and any comparable 

10 State program providing for interest reduction 

11 payments or rental assistance payments. 

12 (I) Sections 514, 515, and 516 of the 

13 Housing Act of 1949 (42 U.S.C. 1484, 1485, 

14 and 1486). 

15 (J) Section 521 of the Housing Act of 

16 1949 (42 U.S.C. 1490a). 

17 (K) The urban development action grant 

18 program under section 119 of the Housing and 

19 Community Development Act of 1974 (42 

20 U.S.C. 5318), to the extent that the afford21 ability of dwelling units subject to such pro22 gram are restricted pursuant to a government 

23 agreement. 

24 (L) The rental development grant program 

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1 ing Act of 1937 (42 U.S.C. 1437o), as in effect 

2 before October 1, 1989, to the extent that rents 

3 of a project assisted under such program are 

4 restricted pursuant to a government agreement. 

5 (5) DEPARTMENT.—The term ‘‘Department’’ 

6 means the Department of Housing and Urban De7 velopment. 

8 (6) LOW-INCOME FAMILY.—The term ‘‘low-in9 come family’’ has the meaning given such term in 

10 section 3(b) of the Unites States Housing Act of 

11 1937 (42 U.S.C. 1437a(b)). 

12 (7) OWNER.—The term ‘‘owner’’ means, with 

13 respect to covered housing, the person, firm, part14 nership, corporation, trust, organization, limited li15 ability company, or other entity, or its successors or 

16 assigns, that holds title to the housing. 

17 (8) PREPAYMENT.—The term ‘‘prepayment’’ 

18 means— 

19 (A) the payment in full, or the refinancing, 

20 of a federally insured or federally held mortgage 

21 loan indebtedness prior to the original maturity 

22 date, 

23 (B) the voluntary cancellation of mortgage 

24 insurance on covered housing, or 


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1 (C) the payment in full of a government 

2 contract, 

3 any of which would have the effect of removing (i) 

4 the affordability restrictions applicable to covered 

5 housing, or (ii) a requirement to renew any such af6 fordability restrictions 

7 (9) PURCHASE CONTRACT.—The term ‘‘pur8 chase contract’’ means a binding written agreement 

9 under which an owner agrees to sell covered housing 

10 including, without limitation, a purchase and sale 

11 agreement, contract of sale, purchase option, or 

12 other similar instrument. 

13 (10) RESIDENT COUNCIL.— 

14 (A) IN GENERAL.—The term ‘‘resident 

15 council’’ means, with respect to covered hous16 ing, any incorporated nonprofit organization or 

17 association that— 

18 (i) is representative of the residents of 

19 the covered housing; 

20 (ii) adopts written procedures pro21 viding for the election of officers on a reg22 ular basis; and 

23 (iii) has a democratically elected gov24 erning board, elected by the residents of 

25 the covered housing. 


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1 (B) LIMITATION.—No owner of covered 

2 housing or other third party shall be required 

3 to ascertain an organization’s or association’s 

4 compliance with the requirements of subpara5 graph (A). 

6 (11) SALE.— 

7 (A) IN GENERAL.—The term ‘‘sale’’ means 

8 an act by which an owner conveys, transfers, or 

9 disposes property by deed or otherwise, whether 

10 through a single transaction, or a series of 

11 transactions, during a 2-year period. 

12 (B) LIMITATION.—Such term does not in13 clude disposition of covered housing by an 

14 owner to an affiliate of such owner. 

15 (12) SECRETARY.—The term ‘‘Secretary’’ 

16 means the Secretary of Housing and Urban Develop17 ment. 

18 (13) STATE HOUSING AGENCY.—The term 

19 ‘‘State housing agency’’ means the department of 

20 housing or department of housing and community 

21 development of a State, or any comparable State 

22 agency. 

23 (14) TENANT.—The term ‘‘tenant’’ means, with 

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1 ered housing, including a subtenant, lessee, and sub2 lessee. 

3 (15) TERMINATION.—The term ‘‘termination’’ 

4 means, with respect to covered housing, the date 

5 that— 

6 (A) the mortgage or loan for the housing 

7 matures and the affordability restrictions appli8 cable to the housing because of assistance for 

9 the housing pursuant to a program referred to 

10 in paragraph (4) terminate with respect to the 

11 housing; 

12 (B) an assistance contract under a pro13 gram referred to in paragraph (4) for the hous14 ing that is not renewed, terminates, or expires; 

15 (C) in the case of housing that is not eligi16 ble low-income housing, as such term is defined 

17 in section 229 of the Low-Income Housing 

18 Preservation and Resident Homeownership Act 

19 of 1990 (12 U.S.C. 4119), the mortgage or 

20 loan that covers the housing is prepaid or an 

21 insurance contract that covers the housing ter22 minates; or 

23 (D) use restrictions imposed with respect 

24 to the housing pursuant to the Emergency Low 


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1 Income Housing Preservation Act of 1987 ex2 pire. 

3 (i) REGULATIONS.—The Secretary shall issue regula4 tions to carry out this section not later than the effective 

5 date under subsection (j). This subsection shall take effect 

6 upon the date of the enactment of this Act. 

7 (j) EFFECTIVE DATE.—Except as otherwise specifi8 cally provided in this section, this section shall take upon 

9 the expiration of the 180-day period beginning on the date 

10 of the enactment of this Act. 

11 SEC. 108. AMENDMENT TO LOW-INCOME HOUSING PRESER12 VATION AND RESIDENT HOMEOWNERSHIP 

13 ACT OF 1990. 

14 Section 232 of the Low-Income Housing Preservation 

15 and Resident Homeownership Act of 1990 (12 U.S.C. 

16 4122) is amended— 

17 (1) in subsection (a), by striking ‘‘No State’’ 

18 and inserting ‘‘Except as provided in subsection (c), 

19 no State’’; and 

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

22 ‘‘(c) INAPPLICABILITY TO HOUSING FOR WHICH NO

23 PLAN OF ACTION IS EXECUTED.—Preemption under sub24 section (a) shall not apply to eligible low-income housing 


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1 for which an owner has not executed a plan of action for 

2 incentives under this subtitle. 

3 ‘‘(d) CLARIFICATION OF CONGRESSIONAL INTENT

4 REGARDING FEDERAL PREEMPTION.—State and local 

5 laws intended to further the preservation of affordable 

6 housing or to protect tenants when owners propose to ter7 minate their participation in Federal affordable housing 

8 programs are not preempted by Federal law, except as ex9 pressly required by the terms of any applicable Federal 

10 statute.’’. 

11 SEC. 109. PRESERVATION OF HUD-HELD AND HUD-OWNED 

12 BUILDINGS. 

13 (a) USE OF ALL AVAILABLE ENFORCEMENT AND

14 INTERVENTION TOOLS.—To maximize the preservation of 

15 existing housing assisted by the Department of Housing 

16 and Urban Development, the Secretary of Housing and 

17 Urban Development shall utilize all available enforcement 

18 and intervention tools to stabilize properties in distress, 

19 including acting as mortgagee-in-possession, accepting 

20 deeds in lieu of foreclosure from owners, and exercising 

21 rights under applicable program contacts and regulations. 

22 (b) MANAGEMENT AND DISPOSITION AUTHORITY.— 

23 Subsection (a) of 204 of the Departments of Veterans Af24 fairs and Housing and Urban Development, and IndeVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00091 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 pendent Agencies Appropriations Act, 1997 (12 U.S.C. 

2 1715z–11a(a)) is amended— 

3 (1) by striking ‘‘During’’ and all that follows 

4 through ‘‘and thereafter, the provision of’’ and in5 serting ‘‘In managing and disposing of multifamily 

6 properties that are owned by the Secretary or that 

7 have mortgages held by the Secretary, during any 

8 fiscal year, the Secretary may provide’’; 

9 (2) by striking ‘‘and multifamily mortgages held 

10 by the Secretary’’; and 

11 (3) by striking ‘‘notwithstanding any other pro12 vision’’ and inserting ‘‘consistent with other applica13 ble provisions’’. 

14 SEC. 110. AUTHORITY FOR HUD TO ASSIGN FLEXIBLE SUB15 SIDY LOANS. 

16 The Secretary of Housing and Urban Development 

17 may, in connection with a preservation transaction or 

18 transfer of an assisted project to an owner that commits 

19 to long-term use and affordability restrictions with respect 

20 to the property to forgive or assign to the transferee any 

21 debt held by the Secretary that was created pursuant to 

22 section 201 of the Housing and Community Development 

23 Amendments of 1978 (12 U.S.C. 1715z–1a), if required 

24 for the financial viability of the preservation transaction 

25 or the transfer. If any low-income housing tax credits 


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1 under section 42 of the Internal Revenue Code of 1986 

2 (26 U.S.C. 42), State or local funds, tax-exempt housing 

3 bonds, or other affordable housing resources are being uti4 lized by the purchaser in connection with the transfer of 

5 the property, the Secretary shall not require any repay6 ment in connection with the assignment or forgiveness of 

7 the mortgages to the purchaser. 

8 SEC. 111. USE OF EXISTING SECTION 8 FUNDS TO PRE9 SERVE AND REVITALIZE AFFORDABLE HOUS10 ING. 

11 Section 8 of the United States Housing Act of 1937 

12 (42 U.S.C. 1437f) is amended by adding at the end the 

13 following: 

14 ‘‘(ff) AFFORDABLE HOUSING PRESERVATION AND

15 REVITALIZATION PROGRAM.— 

16 ‘‘(1) IN GENERAL.—The Secretary of Housing 

17 and Urban Development shall ensure that funds in 

18 the residual receipts account of an eligible multi19 family housing property are, at the time of a quali20 fied sale or pursuant to an approved rehabilitation 

21 plan approved by the Secretary or the section 8 con22 tract administrator, transferred or released, in con23 junction with an approved rehabilitation plan, to the 

24 acquiring owner. 


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1 ‘‘(2) USE OF RESIDUAL RECEIPT FUNDS BY

2 PURCHASER.—An owner that acquires an assisted 

3 multifamily housing property through a qualified 

4 sale shall, subject to the approval of the Secretary, 

5 use the funds in the residual receipts account trans6 ferred to it, or for its benefit— 

7 ‘‘(A) to pay for rehabilitation costs; 

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

9 reserve account of the property; 

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

11 that directly benefit the tenants of such prop12 erty; 

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

14 acquisition of the property; and 

15 ‘‘(E) to pay for any other costs, as deter16 mined eligible by the Secretary. 

17 ‘‘(3) USE OF RESIDUAL RECEIPTS BY OWNERS

18 TO PRESERVE AND RENEW AFFORDABLE HOUS19 ING.—Subject to approval and any requirements es20 tablished by the Secretary, an owner of an eligible 

21 multifamily housing property may use funds in the 

22 residual receipts account for the property to— 

23 ‘‘(A) reduce operating or cash flow deficits 

24 when such use would prevent an increase in 

25 rental rates for tenants; 


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1 ‘‘(B) make a mortgage payment when a 

2 mortgage default is actual or imminent; 

3 ‘‘(C) pay for rehabilitation costs, which 

4 may include— 

5 ‘‘(i) making repairs to the property 

6 not otherwise covered by a reserve for re7 placements or other similar fund; 

8 ‘‘(ii) providing additional project 

9 amenities and improvements, such as air 

10 conditioning, a sprinkler system, fire or 

11 smoke detectors, energy saving devices or 

12 improvements, office equipment, and com13 puters and associated software; and 

14 ‘‘(iii) making enhancements to the 

15 property or retrofit units to enhance acces16 sibility; 

17 ‘‘(D) pay accrued, allowable distributions 

18 in cases in which insufficient surplus cash is 

19 available; 

20 ‘‘(E) repay residual receipt notes approved 

21 by the Secretary; 

22 ‘‘(F) repay flexible subsidy operating as23 sistance or capital improvements loans provided 

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1 nity Development Amendments of 1978 (12 

2 U.S.C. 1715z–1a); 

3 ‘‘(G) provide for testing or abatement of 

4 lead-based paint at the property; 

5 ‘‘(H) provide for social and other services 

6 that directly benefit the tenants of such prop7 erty; and 

8 ‘‘(I) pay for any costs or purposes, as de9 termined eligible by the Secretary. 

10 ‘‘(4) DELEGATION OF AUTHORITY TO SECTION

11 8 CONTRACT ADMINISTRATOR OR OTHER ENTITY.— 

12 At the request of a section 8 contract administrator 

13 or other appropriate entity, as determined by the 

14 Secretary, that administers assistance referred to in 

15 paragraph (5)(A)(i) with respect to an eligible multi16 family housing property, the Secretary may delegate 

17 to such agency the authority of the Secretary under 

18 paragraph (2) or (3), or both, to approve the use of 

19 funds in residual receipt accounts for properties so 

20 assisted by such agency as provided in such para21 graph or paragraphs. 

22 ‘‘(5) DEFINITIONS.—For purposes of this sub23 section, the following definitions shall apply: 


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1 ‘‘(A) ELIGIBLE MULTIFAMILY HOUSING

2 PROPERTY.—The term ‘eligible multifamily 

3 housing property’ means a property that— 

4 ‘‘(i) is assisted under any program 

5 providing project-based assistance under 

6 section 8 of the United States Housing Act 

7 of 1937 (42 U.S.C. 1437f); and 

8 ‘‘(ii) is subject to regulations of the 

9 Secretary in effect on the date of enact10 ment of this subsection that require remit11 tance of excess funds to the Secretary 

12 upon termination of the project-based as13 sistance contract. 

14 ‘‘(B) QUALIFIED SALE.— 

15 ‘‘(i) IN GENERAL.—The term ‘quali16 fied sale’ means the sale or other transfer 

17 of an eligible multifamily housing property 

18 to an owner who agrees to maintain afford19 ability and use restrictions regarding the 

20 property that are— 

21 ‘‘(I) for a term of not less than 

22 30 years from the time of the quali23 fied sale; and 

24 ‘‘(II) legally enforceable. 


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1 ‘‘(ii) FUTURE APPLICABILITY OF RE2 STRICTIONS.—The restrictions under sub3 paragraph (A) shall be— 

4 ‘‘(I) binding on all successors 

5 and assigns of the qualified preserva6 tion owner; and 

7 ‘‘(II) recorded as a restrictive 

8 covenant on the property pursuant to 

9 State law. 

10 ‘‘(C) RESIDUAL RECEIPTS.—The term ‘re11 sidual receipts’ means— 

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

13 excess of the amount needed for operating 

14 expenses, operating reserve requirements, 

15 and allowable distributions to project own16 ers; and 

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

18 Secretary, in his or her discretion, des19 ignates as residual receipts. 

20 ‘‘(6) RESIDUAL RECEIPTS NOT TREATED AS

21 FEDERAL FUNDS.—For the purposes of section 42 

22 of the Internal Revenue Code of 1986, residual re23 ceipts used or transferred under this section shall 

24 not be considered Federal funds.’’. 


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1 SEC. 112. AUTHORITY FOR GINNIE MAE TO SECURITIZE 

2 FHA RISK-SHARING MORTGAGES. 

3 (a) AUTHORITY.—Section 542 of the Housing and 

4 Community Development Act of 1992 (12 U.S.C. 1715z– 

5 22) is amended— 

6 (1) in subsection (b), by striking paragraph (8) 

7 and inserting the following new paragraph: 

8 ‘‘(8) GINNIE MAE SECURITIZATION.—The Gov9 ernment National Mortgage Association may 

10 securitize any multifamily loan insured or reinsured 

11 under this subsection under the same terms and 

12 conditions as if the loan were insured under the Na13 tional Housing Act.’’; and 

14 (2) in subsection (c), by striking paragraph (6) 

15 and inserting the following new paragraph: 

16 ‘‘(6) GINNIE MAE SECURITIZATION.—The Gov17 ernment National Mortgage Association may 

18 securitize any multifamily loan insured under this 

19 subsection under the same terms and conditions as 

20 if the loan were insured under the National Housing 

21 Act.’’. 

22 (b) LIMITATION.—Section 542 of the Housing and 

23 Community Development Act of 1992 is amended by add24 ing at the end the following new subsection: 

25 ‘‘(d) LIMITATION.—In carrying out subsections 

26 (b)(8) and (c)(6), the Secretary shall prohibit State housVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00099 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 ing finance agencies from giving preference to, or condi2 tioning the approval of, awards of subordinate debt funds, 

3 allocation of tax credits, or tax exempt bonds based on 

4 the use of financing for the first mortgage that is provided 

5 by such State housing finance agency.’’. 

6 (c) CONFORMING AMENDMENT.—Clause (ii) of the 

7 first sentence of section 306(g)(1) of the National Hous8 ing Act (12 U.S.C. 1721(g)(1)) is amended by inserting 

9 before the period at the end the following: ‘‘; or insured 

10 or reinsured under subsection (b) or (c) of section 542 

11 of the Housing and Community Development Act of 1992, 

12 subject to the terms of paragraph (8) or (6), respectively, 

13 of such subsection’’. 

14 TITLE II—RESTORATION OF 

15 HOUSING AT RISK OF LOSS 

16 DUE TO DETERIORATION 

17 SEC. 201. AUTHORITY TO TRANSFER RENTAL ASSISTANCE 

18 TO OTHER PROPERTIES. 

19 (a) AUTHORITY.—Subject to subsection (b) and not20 withstanding any other provision of law, the Secretary of 

21 Housing and Urban Development may authorize the 

22 transfer of some or all of project-based assistance, debt, 

23 interest reduction payments, and statutorily required low24 income and very low-income use restrictions, associated 

25 with one or more covered multifamily housing properties 


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1 to another covered multifamily housing property or prop2 erties located in the same metropolitan area. 

3 (b) PHASED TRANSFERS.—Transfers of project4 based assistance under this section may be done in phases 

5 to accommodate the financing and other requirements re6 lated to improving or constructing the property or prop7 erties to which the assistance is transferred to ensure that 

8 such property or properties meet the standards under sub9 section (c). 

10 (c) CONDITIONS.—A transfer authorized in sub11 section (a) shall be subject to the following conditions: 

12 (1) TOTAL NUMBER OF LOW-INCOME UNITS.— 

13 The number of low-income and very low-income 

14 dwelling units provided by the transferring property 

15 or properties shall remain the same as the number 

16 of such dwelling units in the receiving property or 

17 properties. Upon transfer of subsidy, vacant, non18 viable, or obsolete units may be replaced with units 

19 that meet the demands of the local waiting list for 

20 assistance under section 8 of the United States 

21 Housing Act of 1937 (42 U.S.C. 1437f) or current 

22 market demand, but only if there is no impact on as23 sisted residents of such units. 

24 (2) NET AMOUNT OF ASSISTANCE.—The net 

25 dollar amount of Federal assistance provided to the 


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1 transferring property or properties shall remain the 

2 same as the net dollar amount of Federal assistance 

3 provided to the receiving property or properties, un4 less an increase in Federal assistance is necessary to 

5 secure project financing, to allow rent increases per6 mitted under the Multifamily Affordable Housing 

7 Reform and Affordability Act of 1997 (42 U.S.C. 

8 1437f note), to accommodate allowable reconfigura9 tions of the units and bedrooms, or to allow stand10 ard contract extensions, or simultaneous termination 

11 of current contracts with extensions of new contract 

12 authority, similar to that extended to comparable 

13 properties, as determined by the Secretary. 

14 (3) CONDITION OF TRANSFERRING PROP15 ERTY.—The transferring property shall, as deter16 mined by the Secretary, be physically obsolete or 

17 economically non-viable. 

18 (4) CONDITION OF RECEIVING PROPERTY.—The 

19 receiving property shall meet or exceed applicable 

20 physical standards established by the Secretary with21 in a reasonable period of time, as determined by the 

22 Secretary. 

23 (5) TENANT PROTECTION.— 

24 (A) NOTIFICATION AND CONSULTATION.— 

25 The owner or mortgagor of the transferring 


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1 property shall notify and consult with the ten2 ants of the transferring property concerning all 

3 significant elements of the transfer plan, includ4 ing the identification of receiving properties and 

5 any proposed additional ownership entities. 

6 (B) BEST INTEREST OF TENANTS; FAIR

7 HOUSING.—The transfer shall, as determined 

8 by the Secretary— 

9 (i) be in the best interest of the ten10 ants; and 

11 (ii) comply with applicable statutes 

12 and regulations relating to fair housing. 

13 (6) AVAILABILITY OF NEW UNITS.—The ten14 ants of the transferring property shall not be re15 quired to vacate their dwelling units in the transfer16 ring property until new units in the receiving prop17 erty or properties are available for occupancy, in18 cluding a phase or phases of a multi-phase project 

19 or projects that are available for occupancy. Tenants 

20 may choose to be temporarily relocated to facilitate 

21 their transition to the receiving property according 

22 to relocation procedures set forth in the Uniform 

23 Relocation Assistance and Real Property Acquisition 

24 Act of 1970 (42 U.S.C. 4601 et seq.). 


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1 (7) MORTGAGES UNDER NATIONAL HOUSING

2 ACT.—Any lien on the receiving property resulting 

3 from additional financing obtained by the owner 

4 shall be subordinate to any lien under a mortgage 

5 insured under the National Housing Act that is 

6 transferred to, or placed on, such property by the 

7 Secretary, except that the Secretary may waive this 

8 requirement upon determination that such waiver is 

9 necessary to facilitate the financing of acquisition, 

10 construction, or rehabilitation of the receiving prop11 erty. 

12 (8) HOUSING SUBJECT TO A USE AGREE13 MENT.—The owner or mortgagor of the receiving 

14 property shall execute and record a continuation of 

15 the existing use agreement or a new use agreement 

16 for the property containing use restrictions having a 

17 duration at least as long as the existing restrictions. 

18 (9) NO INCREASE OF RISK TO INSURANCE

19 FUNDS.—The transfer under this section shall result 

20 in no increase in financial risk to the General and 

21 Special Risk Insurance Funds of the Secretary, as 

22 determined by the Secretary, except that the Sec23 retary may waive this requirement upon determina24 tion that such waiver is necessary to facilitate the fiVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00104 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 nancing of acquisition, construction, or rehabilitation 

2 of the receiving property. 

3 (10) NO INCREASE OF FEDERAL LIABILITY.— 

4 Federal liability with regard to the receiving prop5 erty shall not be increased, as determined by the 

6 Secretary, except as provided in paragraph (2). 

7 (d) DEFINITIONS.—For purposes of this section, the 

8 following definitions shall apply: 

9 (1) COVERED MULTIFAMILY HOUSING PROP10 ERTY.—The term ‘‘covered multifamily housing 

11 property’’ means housing that is assisted or insured 

12 under one or more of the following programs: 

13 (A) The rent supplement program under 

14 section 101 of the Housing and Urban Develop15 ment Act of 1965 (12 U.S.C. 1701s). 

16 (B) The below-market interest rate mort17 gage insurance program under section 

18 221(d)(3) of the National Housing Act (12 

19 U.S.C. 17151(d)(3)). 

20 (C) The program for assistance provided 

21 under the proviso in section 221(d)(5) of the 

22 National Housing Act (12 U.S.C. 17151(d)(5)). 

23 (D) A contract under section 236(f)(2) of 

24 the National Housing Act (12 U.S.C. 1715z– 

25 1(f)(2)). 


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1 (E) The program for interest reduction 

2 payments under section 236 of the National 

3 Housing Act (12 U.S.C. 1715z–1) or a com4 parable State program providing for interest re5 duction payments. 

6 (F) Any other mortgage insurance pro7 gram provided under the National Housing Act 

8 for which the insured property is subject to 

9 budget-based rent restrictions. 

10 (G) The program for supportive housing 

11 for the elderly under section 202 of the Hous12 ing Act of 1959 (12 U.S.C. 1701q), including 

13 assistance under such section as was in effect 

14 before the enactment of the Cranston-Gonzales 

15 National Affordable Housing Act. 

16 (H) The program for rural rental housing 

17 under section 515 of the Housing Act of 1949 

18 (42 U.S.C. 1485). 

19 (I) Any program providing project-based 

20 assistance that is attached to the structure. 

21 (J) Any other program under which the 

22 Secretary provides any rental assistance, mort23 gage insurance, subsidy, or other financial as24 sistance. 


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1 (2) LOW-INCOME; VERY LOW-INCOME.—The 

2 terms ‘‘low-income’’ and ‘‘very low-income’’, with re3 spect to a covered multifamily housing property, 

4 shall have the meanings provided under the laws and 

5 regulations governing the program under which the 

6 covered multifamily housing property is insured or 

7 assisted. 

8 (3) PROJECT-BASED ASSISTANCE.—The term 

9 ‘‘project-based assistance’’ means— 

10 (A) assistance provided under section 8(b) 

11 of the United States Housing Act of 1937 (42 

12 U.S.C. 1437f(b)), including the additional as13 sistance program; 

14 (B) assistance for housing constructed or 

15 substantially rehabilitated pursuant to assist16 ance provided under section 8(b)(2) of such Act 

17 (as such section was in effect immediately be18 fore October 1, 1983); 

19 (C) rent supplement payments under sec20 tion 101 of the Housing and Urban Develop21 ment Act of 1965 (12 U.S.C. 1701s); 

22 (D) additional assistance payments under 

23 section 236(f)(2) of the National Housing Act 

24 (12 U.S.C. 1715z–1(f)(2)) or a comparable 


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1 State program providing for interest reduction 

2 payments; 

3 (E) payments made under section 

4 202(c)(2) of the Housing Act of 1959 (12 

5 U.S.C. 1701q(c)(2)); and 

6 (F) payments made under any other Fed7 eral program under which rental assistance is 

8 attached to the structure. 

9 (4) RECEIVING PROPERTY.—The term ‘‘receiv10 ing property’’ means, with respect to a transfer of 

11 project-based assistance, debt, and statutorily re12 quired low-income and very low-income use restric13 tions under this section, the covered multifamily 

14 housing property or properties to which the assist15 ance, debt, and use restrictions are to be trans16 ferred. 

17 (5) SECRETARY.—The term ‘‘Secretary’’ means 

18 the Secretary of Housing and Urban Development. 

19 (6) TRANSFERRING PROPERTY.—The term 

20 ‘‘transferring property’’ means, with respect to a 

21 transfer of project-based assistance, debt, and statu22 torily required low-income and very low-income use 

23 restrictions under this section, the covered multi24 family housing property or properties from which 


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1 the assistance, debt, and use restrictions are to be 

2 transferred. 

3 SEC. 202. BUILDING TRANSFERS: REQUIREMENTS FOR PUR4 CHASERS OF FHA INSURED PROJECTS AND 

5 SECTION 8 PROJECTS. 

6 (a) REQUIREMENTS FOR POTENTIAL PUR7 CHASERS.—Not later than 90 days after the date of the 

8 enactment of this Act, the Secretary of Housing and 

9 Urban Development shall issue a proposed rulemaking, in 

10 accordance with title 5, United States Code, that applies 

11 the participation and certification requirements for poten12 tial purchasers required under section 219 of Division G 

13 of the Consolidated Appropriations Act, 2004 (Public Law 

14 108–199; 118 Stat. 397) to the sale or transfer of any 

15 multifamily housing having a mortgage that is insured or 

16 receives assistance under the National Housing Act or for 

17 which project-based assistance is provided under section 

18 8 of the United States Housing Act of 1937 (42 U.S.C. 

19 1437f). 

20 (b) NOTICE TO LOCAL GOVERNMENT AND RESI21 DENTS OF APPLICATION FOR TRANSFER.—The Secretary 

22 shall provide notice of an owner’s application for approval 

23 of any such transfer to the unit of local government where 

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1 erty, using procedures required under the Housing and 

2 Community Development Amendments of 1978. 

3 (c) GROUNDS FOR DISAPPROVAL.—Grounds for dis4 approval of a transfer may include— 

5 (1) a purchaser’s record of pervasive or con6 tinuing noncompliance under housing, health, and 

7 safety codes with respect to other housing owned or 

8 managed by the purchaser, regardless of location, 

9 except where the Secretary determines that such 

10 noncompliance did not result from the actions of the 

11 purchaser and would be satisfactorily remedied by a 

12 plan approved by the Secretary; and 

13 (2) a risk of financial instability for the project 

14 under the terms of the acquisition, such as indicated 

15 by the application of conventional underwriting 

16 standards. 

17 SEC. 203. USE OF INTEREST REDUCTION PAYMENTS FOR 

18 REHABILITATION GRANTS. 

19 The Secretary of Housing and Urban Development 

20 may obligate any amounts recaptured from the termi21 nation of a contract for interest reduction payments under 

22 section 236 of the National Housing Act (12 U.S.C. 

23 1715z–1), for the use under subsection (s) of such section, 

24 except that the Secretary shall take immediate action to 

25 issue appropriate guidelines to make such funds available 


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1 within 180 days after the date of the enactment of this 

2 Act, which shall include the availability of both loans and 

3 grants. 

4 SEC. 204. CLARIFICATION OF BUDGET-BASED RENT IN5 CREASES FOR REHABILITATED PROJECTS. 

6 (a) APPROVAL OF RENT INCREASES.— 

7 (1) APPROVAL.—At the request of an owner of 

8 a covered multifamily housing property (which term, 

9 for purposes of this section, shall have the same 

10 meaning given such term in section 201(c) of this 

11 Act) that meets the requirements of paragraph (2), 

12 the Secretary of Housing and Urban Development 

13 shall, prior to rehabilitation and subject to sub14 section (b), adjust project rents on a budget-based 

15 basis to support the cost of the rehabilitation, any 

16 increased debt service, and other appropriate costs. 

17 (2) REQUIREMENTS.—The requirements of this 

18 paragraph with respect to a covered multifamily 

19 housing property are that— 

20 (A) the project is to undergo rehabilitation; 

21 and 

22 (B) the owner or purchaser of the project 

23 executes a binding agreement to preserve the 

24 project as affordable housing at least until the 

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1 gage for the project or the termination of an as2 sistance contract on the property. 

3 (b) CONDITIONS.—Rent adjustments pursuant to this 

4 section for a covered multifamily housing property shall 

5 be subject to the following conditions and requirements: 

6 (1) EFFECTIVENESS.—Such rent adjustments 

7 shall not become effective until completion of the re8 habilitation of the property. 

9 (2) AMOUNT.—Such rent adjustments shall— 

10 (A) be subject to adjustment by the Sec11 retary based on differences between estimated 

12 and actual costs; and 

13 (B) with respect to units that are assisted 

14 under section 8 of the United States Housing 

15 Act of 1937 (42 U.S.C. 1437) that are subject 

16 to a renewal contract under section 524(a) of 

17 the Multifamily Assisted Housing Reform and 

18 Affordability Act of 1997 (42 U.S.C. 1437f 

19 note), not exceed, after rehabilitation, the rent 

20 for comparable unassisted units in the area. 

21 (3) TENANT NOTICE AND OPPORTUNITY TO

22 COMMENT.—Tenants in the property shall be pro23 vided notice and an opportunity to comment on such 

24 rent adjustments in accordance with rent increase 

25 procedures of the Department of Housing and 


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1 Urban Development issued pursuant to the authority 

2 under section 202(b) of the Housing and Commu3 nity Development Amendments of 1978 (12 U.S.C. 

4 1715z–1b(b)). 

5 (4) PROVISION OF RENTAL ASSISTANCE.—Rent6 al assistance shall be provided for all affected eligi7 ble tenants of the property in the form of new 

8 project-based assistance for previously unassisted 

9 units and legally authorized contract rent increases 

10 under existing project-based contracts. 

11 (c) EFFECT ON OTHER TRANSACTIONS.—This sec12 tion shall not have any effect on transactions not meeting 

13 the terms and conditions of this section. 

14 SEC. 205. INTEREST REDUCTION PAYMENTS FOR SECTION 

15 236 PROJECTS EXPERIENCING A REDUCTION 

16 OF UNITS. 

17 (a) IN GENERAL.—Section 236(e)(2) of the National 

18 Housing Act (12 U.S.C. 1715z–1(e)(2)) is amended— 

19 (1) by striking ‘‘under the terms’’ and inserting 

20 ‘‘for the remaining term’’; and 

21 (2) by adding at the end the following new sen22 tence: ‘‘The Secretary may continue to provide the 

23 interest reduction payments in their entirely, not24 withstanding a reduction of total units, if the project 

25 owner is able to demonstrate that such an action will 


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1 contribute to the long-term physical or financial via2 bility of the property.’’. 

3 (b) APPLICABILITY.—The amendments made by sub4 section (a) shall apply to all interest reduction payments 

5 made after October 1, 2006. 

6 TITLE III—PROTECTION OF 

7 RESIDENTS 

8 SEC. 301. TENANT PROTECTION VOUCHER TO REPLACE 

9 LOST SUBSIDIZED UNITS ON 1-FOR-1 BASIS. 

10 Subject only to the availability of amounts provided 

11 for such purpose in appropriation Acts, the Secretary of 

12 Housing and Urban Development shall provide replace13 ment vouchers for rental assistance under section 8 of the 

14 United States Housing Act of 1937 (42 U.S.C. 1437f) for 

15 all dwelling units in projects that cease to be covered mul16 tifamily housing properties (as such term is defined in sec17 tion 201 of this Act) due to demolition, disposition, or con18 version. 

19 SEC. 302. MAINTENANCE OF HOUSING. 

20 Section 8(d) of the United States Housing Act of 

21 1937 (42 U.S.C. 1437f(d)) is amended by adding at the 

22 end the following new paragraphs: 

23 ‘‘(7) ENFORCEMENT OF HOUSING STANDARDS RE24 LATED TO PHYSICAL CONDITION OF PROPERTY.—If the 

25 Secretary determines, upon any inspection or management 


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1 review for any multifamily housing project covered by a 

2 housing assistance payments contract under this section, 

3 that there are serious violations of housing standards ap4 plicable to such project that are not corrected after reason5 able notice, or any other substantial or repeated violations 

6 of other program requirements, including residents right 

7 to organize, the Secretary may take one or more of the 

8 following actions: 

9 ‘‘(A) Withhold all or part of the housing assist10 ance payments due under the contract. 

11 ‘‘(B) Withhold any rent increases otherwise 

12 due. 

13 ‘‘(C) Assume possession and management of 

14 the project and take any actions necessary to correct 

15 the violations, including using such withheld pay16 ments to effectuate repairs or to reimburse others 

17 who make repairs. 

18 ‘‘(D) Use such withheld payments to pay for 

19 utilities and other services that are the responsibility 

20 of the owner under the lease or applicable law. 

21 ‘‘(8) ESCROW OF TENANT RENTS.—If the Secretary 

22 determines that there are serious violations of housing 

23 standards applicable to any multifamily housing project 

24 covered by a housing assistance payments contract under 

25 this section or any other substantial or repeated violations 


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1 of other program requirements, any tenants in assisted 

2 units in the project may withhold the tenant contribution 

3 toward rent and pay such amount, when due, into an es4 crow fund, or use such withheld payments to effectuate 

5 repairs, in accordance with procedures established by the 

6 Secretary. If a tenant withholds the tenant contribution 

7 toward rent in accordance with this paragraph, the Sec8 retary shall withhold all or part of the housing assistance 

9 payments due under the contract until the violation is 

10 remedied. An owner of a project shall not evict tenants 

11 for nonpayment of rent for exercising rights under this 

12 paragraph. 

13 ‘‘(9) PROTECTION OF TENANTS.—An owner of a 

14 multifamily housing project covered by a housing assist15 ance payments contract under this subsection may not ter16 minate the tenancy of any tenant because of the with17 holding or abatement of assistance pursuant to this sub18 section. During the period that assistance is abated pursu19 ant to this subsection, the tenant may terminate the ten20 ancy by notifying the owner. 

21 ‘‘(10) INSPECTIONS UPON REQUEST OR PETITION.— 

22 In addition to periodic inspections by the Secretary, the 

23 Secretary shall conduct an inspection or management re24 view of any multifamily housing project covered by a hous25 ing assistance payments contract under this section when 


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1 requested by the local government in which the project is 

2 located or by a petition signed by not less than 25 percent 

3 of the tenants of the occupied units in the project.’’. 

4 SEC. 303. RESIDENT ENFORCEMENT OF PUBLIC HOUSING 

5 AGENCY OR PROJECT OWNER AGREEMENTS 

6 WITH HUD. 

7 (a) IN GENERAL.—In each covered agreement de8 scribed in subsection (c), any resident, or resident or ten9 ant association, of an affected project shall be permitted 

10 to petition the Secretary of Housing and Urban Develop11 ment requesting enforcement of alleged violations of the 

12 covered agreement. 

13 (b) JUDICIAL RELIEF.—If the Secretary, or the des14 ignee of the Secretary, fails to issue a determination re15 garding an enforcement request within 90 days after re16 ceipt of the petition, the resident, or resident or tenant 

17 association, may seek appropriate judicial relief in connec18 tion with the alleged violation and enforcement of a cov19 ered agreement in any forum of competent jurisdiction. 

20 In the case of any alleged violation that threaten the 

21 health or safety of tenants, the time period for making 

22 such a determination shall be no longer than 15 days. 

23 (c) COVERED AGREEMENTS.—A covered agreement 

24 described in this subsection is any— 


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1 (1) contract between the Secretary and any 

2 public housing agency for housing assistance pay3 ments under section 8 of the United States Housing 

4 Act of 1937 (42 U.S.C. 1437f); 

5 (2) agreement under the Multifamily Assisted 

6 Housing Reform and Affordability Act of 1997 (42 

7 U.S.C. 1437f note) for— 

8 (A) Mark-to-Market Restructuring Com9 mitments or renewal of section 8 rental assist10 ance for a project involving any action under 

11 section 517(b) of such Act; or 

12 (B) Rehabilitation Escrow Deposit Agree13 ments for Mark-to-Market; or 

14 (3) contract for mortgage insurance executed by 

15 the Secretary and any owner or purchaser of a mul16 tifamily housing project. 

17 (d) REGULATIONS.—Within 180 days after the date 

18 of the enactment of this Act, the Secretary shall issue reg19 ulations providing procedures for— 

20 (1) receiving tenant petitions to enforce the 

21 terms of a covered agreement; 

22 (2) evaluating alleged violations of a covered 

23 agreement; and 

24 (3) providing notice to residents, and resident 

25 and tenant associations. 


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1 SEC. 304. RESIDENT ACCESS TO BUILDING INFORMATION. 

2 (a) ACCESS TO INFORMATION.—Upon a written re3 quest by a legitimate residents association established with 

4 respect to a multifamily housing property to which part 

5 245 of the regulations of the Secretary of Housing and 

6 Urban Development (24 C.F.R. Part 245), by or through 

7 its duly appointed designee or representative, the Sec8 retary shall make available, for the property represented 

9 by the association— 

10 (1) information identifying the legal entities 

11 that own and manage the property, including identi12 fication of general partners and other principals, and 

13 their other properties assisted by the Department of 

14 Housing and Urban Development, including previous 

15 participation certifications (with Social Security 

16 numbers redacted); 

17 (2) an annual operating statement of profit and 

18 loss, and project budgets submitted to the Depart19 ment of Housing and Urban Development; 

20 (3) subsidy contracts and regulatory agree21 ments, use agreements. or other contracts referred 

22 to in section 303(c) of this Act between owners and 

23 the Department of Housing and Urban Develop24 ment, including correspondence between owners and 

25 the Department; 


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1 (4) management reviews, capital needs assess2 ments, and physical inspection reports conducted of 

3 entities identified in paragraph (1) by the Depart4 ment or a contractor of the Department; and 

5 (5) an annual statement, prepared by the De6 partment’s contract administrator for the subject 

7 property, of the balances of, and expenditures from, 

8 any replacement reserves and other escrow funds for 

9 the property. 

10 (b) PROTECTION OF PERSONAL INFORMATION.— 

11 Subsection (a) shall not be construed to require disclosure 

12 of Social Security numbers, personal tax returns, or any 

13 other personal financial information of or concerning indi14 viduals who have an interest in the ownership or manage15 ment entities referred to in subsection (a). 

16 TITLE IV—PRESERVATION OF 

17 TROUBLED PROJECTS FAC18 ING FORECLOSURE 

19 SEC. 401. MAINTAINING AFFORDABILITY THROUGH 

20 ESCROWING OF RENTAL ASSISTANCE. 

21 In the case of any transfer of a distressed multifamily 

22 property that does not comply with housing quality stand23 ards applicable to the property, the Secretary of Housing 

24 and Urban Development may not recapture any rental as25 sistance that is attached to any dwelling units in the propVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00120 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 erty and provided under a contract for the property under 

2 section 8 of the United States Housing Act of 1937 or 

3 under any other program administered by the Secretary, 

4 but shall hold any such assistance in escrow for the prop5 erty during the period of noncompliance and, upon deter6 mining that the property complies with such standards 

7 make such assistance available for the property. 

8 SEC. 402. MULTIFAMILY HOUSING MORTGAGE FORE9 CLOSURE. 

10 The Multifamily Mortgage Foreclosure Act of 1981 

11 is amended— 

12 (1) in section 362 (12 U.S.C. 3701)— 

13 (A) in paragraph (5), by striking ‘‘and’’ at 

14 the end; 

15 (B) in paragraph (6), by striking the pe16 riod at the end and inserting ‘‘; and’’; and 

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

18 paragraph: 

19 ‘‘(7) mortgages transferred by the Secretary to 

20 State and local governments should be foreclosed in 

21 the same manner as mortgages held by the Sec22 retary.’’; 

23 (2) in section 363 (12 U.S.C. 3702)— 

24 (A) in paragraph (9), by striking ‘‘and’’ at 

25 the end; 


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1 (B) in paragraph (10), by striking the pe2 riod at the end and inserting ‘‘; and’’; and 

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

4 paragraph: 

5 ‘‘(11) ‘State or local government transferee’ 

6 means any State or unit of general local govern7 ment, any public housing authority, or any State or 

8 local housing finance agency that has acquired mort9 gages pursuant to section 203 of the Housing and 

10 Community Development Amendments of 1978 (12 

11 U.S.C. 1701z–11), section 204 of the Departments 

12 of Veterans Affairs and Housing and Urban Devel13 opment, and Independent Agencies Appropriations 

14 Act, 1997 (12 U.S.C. 1715z–11a), or any other pro15 vision of law, that were previously held by the Sec16 retary.’’; 

17 (3) in section 364 (12 U.S.C. 3703)— 

18 (A) by inserting ‘‘, or any State or local 

19 government transferee,’’ after ‘‘Secretary’’ the 

20 first and fourth places such term appears; and 

21 (B) by inserting ‘‘, or the State or local 

22 government transferee,’’ after ‘‘Secretary’’ the 

23 second, third, and fifth places such term ap24 pears; 

25 (4) in section 365 (12 U.S.C. 3704)— 


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1 (A) by inserting ‘‘, or any State or local 

2 government transferee,’’ after ‘‘Secretary’’ the 

3 first place such term appears; 

4 (B) by inserting ‘‘, or the State or local 

5 government transferee,’’ after ‘‘Secretary’’ each 

6 other place such term appears; and 

7 (C) by striking the last 3 sentences and in8 serting the following: ‘‘The entity designating 

9 the foreclosure commissioner, whether the Sec10 retary or any State or local government trans11 feree, shall be a guarantor of payment of any 

12 judgment against the foreclosure commissioner 

13 for damages based upon the commissioner’s 

14 failure properly to perform the commissioner’s 

15 duties. As between the entity designating the 

16 foreclosure commissioner, whether the Secretary 

17 or any State or local government transferee, 

18 and the mortgagor, the entity designating the 

19 foreclosure commissioner shall bear the risk of 

20 any financial default by the foreclosure commis21 sioner. In the event that the Secretary or any 

22 State or local government transferee makes any 

23 payment pursuant to the preceding two sen24 tences, the Secretary or any State or local govVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00123 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 ernment transferee shall be fully subrogated to 

2 the rights satisfied by such payment.’’; 

3 (5) in section 366 (12 U.S.C. 3705)— 

4 (A) by inserting ‘‘, or any State or local 

5 government transferee,’’ after ‘‘Secretary’’ the 

6 first, third, fourth, and fifth place such term 

7 appears; and 

8 (B) by inserting ‘‘, or the State or local 

9 government transferee,’’ after ‘‘Secretary’’ the 

10 second and sixth places such term appears; 

11 (6) in section 367 (12 U.S.C. 3706)— 

12 (A) in subsection (a)— 

13 (i) in paragraph (1), by inserting ‘‘or 

14 the State or local government transferee,’’ 

15 after ‘‘Secretary,’’; and 

16 (ii) in paragraph (8), by inserting ‘‘, 

17 or the State or local government trans18 feree’’ after ‘‘Secretary’’; 

19 (B) in subsection (b)— 

20 (i) by inserting ‘‘, or any State or 

21 local government transferee,’’ after ‘‘Sec22 retary’’ the first and second places such 

23 term appears; and 

24 (ii) by inserting ‘‘, or the State or 

25 local government transferee,’’ after ‘‘SecVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00124 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 retary’’ the third place such term appears; 

2 and 

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

4 subsection: 

5 ‘‘(c) In any case in which a State or local government 

6 transferee is the purchaser of a multifamily project, the 

7 State or local government transferee shall manage and dis8 pose of such project to benefit those originally intended 

9 to be assisted under the prior program unless continued 

10 operation and disposition of the property under such pro11 gram is not feasible based on consideration of the costs 

12 of rehabilitating and operating the property after consid13 ering all available Federal, State, and local resources, in14 cluding rent adjustments under section 524 of the Multi15 family Assisted Housing Reform and Affordability Act of 

16 1997 (42 U.S.C. 1437f note).’’. 

17 (7) in section 368 (12 U.S.C. 3707)— 

18 (A) by inserting ‘‘, or any State or local 

19 government transferee,’’ after ‘‘Secretary’’ the 

20 first and third places such term appears; and 

21 (B) by inserting ‘‘, or the State of local 

22 government transferee,’’ after ‘‘Secretary’’ the 

23 second place such term appears; 

24 (8) in section 369A (12 U.S.C. 3709)— 


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1 (A) by inserting ‘‘, or any State or local 

2 government transferee,’’ after ‘‘Secretary’’ the 

3 second place such term appears; and 

4 (B) by inserting ‘, or the State or local 

5 government transferee,’ after ‘Secretary’ the 

6 first, third, and fourth places such term ap7 pears; 

8 (9) in section 369B (12 U.S.C. 3710)— 

9 (A) by inserting ‘‘, or the State of local 

10 government transferee,’’ after ‘‘Secretary’’ the 

11 first and second places such term appears; and 

12 (B) by inserting ‘‘, or any State or local 

13 government transferee,’’ after ‘‘Secretary’’ each 

14 other place such term appears; 

15 (10) in section 369E (12 U.S.C. 3713), by in16 serting ‘‘, or any State or local government trans17 feree,’’ after ‘‘Secretary’’ each place such term ap18 pears; and 

19 (11) in section 369F(a)(1) (12 U.S.C. 

20 3714(a)(1)), by inserting ‘‘, or any State or local 

21 government transferee,’’ before the semicolon at the 

22 end. 


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1 SEC. 403. BUILDING ACQUISITION: VALUATION OF PHYS2 ICALLY DISTRESSED PROPERTIES SOLD BY 

3 HUD. 

4 (a) IN GENERAL.—Notwithstanding title II of the 

5 Deficit Reduction Act of 2005 (12 U.S.C. 1701z–11 note) 

6 or any other provision of law, in determining the market 

7 value of any multifamily real property or multifamily loan 

8 for any noncompetitive sale to a State or local government, 

9 the Secretary of Housing and Urban Development shall 

10 consider, but not be limited to, industry standard ap11 praisal practices, including the cost of repairs needed to 

12 bring the property into such condition as to satisfy min13 imum State and local code standards and the cost of main14 taining the affordability requirements imposed by the Sec15 retary on the multifamily real property or multifamily 

16 loan. 

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

18 terms ‘‘affordability requirements’’, ‘‘multifamily loan’’, 

19 and ‘‘multifamily real property’’ have the same meaning 

20 given such terms in section 2001 of the Deficit Reduction 

21 Act of 2005 (12 U.S.C. 1701z–11 note). 

22 SEC. 404. INVESTMENT THROUGH UP-FRONT GRANTS FROM 

23 GENERAL INSURANCE FUND. 

24 (a) 1978 ACT.—Paragraph (4) of section 203(f) of 

25 the Housing and Community Development Amendments 


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1 of 1978 (12 U.S.C. 1701z–11(f)(4)) is amended by strik2 ing the last sentence. 

3 (b) CLARIFICATION OF AUTHORIZED ASSISTANCE.— 

4 In implementing the provisions amended by subsection (b) 

5 of this section, the Secretary of Housing and Urban Devel6 opment may utilize both up-front grants and project-based 

7 rental assistance under section 8 of the United States 

8 Housing Act of 1937 (42 U.S.C. 1437f) as necessary to 

9 preserve the affordability of a multifamily housing project 

10 to low- and very low-income families. 

11 SEC. 405. MAINTAINING PROJECT-BASED ASSISTANCE FOR 

12 PROJECTS DISPOSED OF BY HUD. 

13 (a) IN GENERAL.—In managing and disposing of any 

14 multifamily property that is owned by, or has a mortgage 

15 held by, the Secretary of Housing and Urban Develop16 ment, the Secretary shall maintain any contracts for rent17 al assistance payments under section 8 of the United 

18 States Housing Act of 1937 (42 U.S.C. 1437f) and other 

19 programs that are attached to any dwelling units in the 

20 property. 

21 (b) INFEASIBILITY OF CONTINUED ASSISTANCE.—To 

22 the extent the Secretary determines, in consultation with 

23 the tenants and the local government, that such a multi24 family property owned or held by the Secretary is not fea25 sible for continued rental assistance payments under such 


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1 section 8 or other programs, based on consideration of (1) 

2 the costs of rehabilitating and operating the property and 

3 all available Federal, State, and local resources, including 

4 rent adjustments under section 524 of the Multifamily As5 sisted Housing Reform and Affordability Act of 1997 (42 

6 U.S.C. 1437f note), and environmental conditions that 

7 cannot be remedied in a cost-effective fashion, the Sec8 retary may, in consultation with the tenants of such prop9 erty, contract for project-based rental assistance payments 

10 with an owner or owners of other existing housing prop11 erties, or provide other rental assistance. 

12 (c) FORECLOSURE.—For all properties with project13 based section 8 assistance, regardless of the type of under14 lying financing, the Secretary shall also take appropriate 

15 actions to ensure that project-based contracts remain in 

16 effect prior to foreclosure, subject to the exercise of con17 tractual remedies to assist relocation of tenants for immi18 nent major threats to health and safety, after written no19 tice to and informed consent of the affected tenants and 

20 use of other available remedies, such as partial abatements 

21 or receivership. 

22 (d) APPLICABILITY OF MAHRA.—After disposition 

23 of any multifamily property described under this section, 

24 the contract and allowable rent levels on such properties 

25 shall be subject to section 524 of the Multifamily Assisted 


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1 Housing Reform and Affordability Act of 1997 (42 U.S.C. 

2 1437f note). 

3 SEC. 406. CORRECTING HARM CAUSED BY LATE SUBSIDY 

4 PAYMENTS. 

5 Section 8 of the United States Housing Act of 1937 

6 (42 U.S.C. 1437f), as amended by the preceding provi7 sions of this Act, is further amended by adding at the end 

8 the following new subsection:’’. 

9 ‘‘(gg) LATE PAYMENTS.— 

10 ‘‘(1) IN GENERAL.—The Secretary shall make 

11 payments of project-based rental assistance provided 

12 under this section for each month on or before the 

13 due date under paragraph (2) for the payment. 

14 ‘‘(2) DUE DATE.—The due date under this 

15 paragraph for a monthly payment is the first busi16 ness day of the month. 

17 ‘‘(3) NOTIFICATION OF LATE PAYMENT.—The 

18 Secretary shall notify a project owner at least 10 

19 days before the due date for a housing assistance 

20 payment if such payment will be late and shall in21 form the project owner of the approximate date the 

22 payment will be made. 

23 ‘‘(4) USE OF RESERVES.—If a housing assist24 ance payment for a project has not been received be25 fore the expiration of the 10-day period beginning 


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1 upon the due date for such payment, the project 

2 owner shall, after the expiration of such period, be 

3 entitled to obtain funds from a project replacement 

4 reserve, residual receipts reserve, or other project re5 serve in order to pay operating and debt service 

6 costs for the project. Upon receipt of the monthly 

7 housing assistance payment from the Secretary, the 

8 project owner shall promptly replace or replenish 

9 any such funds advanced pursuant to the preceding 

10 sentence. 

11 ‘‘(5) INTEREST PAYMENT.—If a monthly hous12 ing assistance payment is not made before the expi13 ration of the 30-day period beginning upon the due 

14 date for such payment, the Secretary shall pay to 

15 the owner simple interest on the amount of such 

16 monthly payment, from the due date until the date 

17 of payment, at a rate determined by the Secretary 

18 of Treasury in accordance with section 12 of the 

19 Contract Disputes Act of 1978 (41 U.S.C. 611). In20 terest payments under this paragraph shall be made 

21 from amounts made available for management and 

22 administration of the Department of Housing and 

23 Urban Development.’’. 


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1 TITLE V—INCENTIVES UNDER 

2 MAHRA FOR OWNERS TO 

3 MAINTAIN HOUSING AFFORD4 ABILITY 

5 SEC. 501. EXTENSION OF MARK-TO-MARKET PROGRAM. 

6 Section 579 of the Multifamily Assisted Housing Re7 form and Affordability Act of 1997 (42 U.S.C. 1437f 

8 note) is amended by striking ‘‘October 1, 2011’’ each place 

9 such term appears and inserting ‘‘October 1, 2015’’. 

10 SEC. 502. MAINTAINING AFFORDABILITY IN PRESERVATION 

11 PROJECT TRANSACTIONS. 

12 (a) RENEWAL UNDER ALTERNATIVE AUTHORI13 TIES.—Paragraph (1) of section 524(e) of the Multifamily 

14 Assisted Housing Reform and Affordability Act of 1997 

15 (42 U.S.C. 1437f note) is amended by adding at the end 

16 the following new sentences: ‘‘At the request of the owner 

17 of the project, in order to facilitate a rehabilitation plan 

18 approved by the Secretary as being necessary to ensure 

19 the sustainability of a project, a contract eligible for re20 newal pursuant to this paragraph may instead be renewed 

21 pursuant to any provision of subsection (a) or (b) of this 

22 section if the contract is otherwise eligible for renewal pur23 suant to such provision. In the case of a renewal pursuant 

24 to subsection (a) or (b), the rent and rent adjustment 

25 standards applicable to a renewal pursuant to those subVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00132 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 sections shall apply, but tenant occupancy and afford2 ability restrictions in the plan of action shall continue to 

3 apply to the project for the duration of those restric4 tions.’’. 

5 (b) EXTENSION OF AFFORDABILITY PERIOD FOR

6 ELIHPA PROJECTS.—Section 524(e) of the Multifamily 

7 Assisted Housing Reform and Affordability Act of 1997 

8 (42 U.S.C. 1437f note) is amended by adding at the end 

9 the following new paragraph: 

10 ‘‘(4) HYBRID CONTRACT.—To facilitate the 

11 sale, transfer, or rehabilitation of a project that is 

12 subject to a plan of action under the Emergency 

13 Low Income Housing Preservation Act of 1987 (12 

14 U.S.C. 1715l note) to an owner who agrees to bind15 ing low-income affordability restrictions for at least 

16 30 years beyond the term of the plan of action and 

17 a rehabilitation plan approved by the Secretary as 

18 being necessary to ensure the sustainability of the 

19 project, a contract for such a project shall, at the re20 quest of the owner of the project, be renewed under 

21 this paragraph for a term of not less than 30 years. 

22 The contract shall provide that the terms of the plan 

23 of action shall apply for the duration of the original 

24 plan of action, and that at the expiration of the plan 

25 of action the rents shall be established at rent levels 


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1 equal to comparable market rents for the market 

2 area. After expiration of the plan of action, rent ad3 justments shall be determined in accordance with 

4 the provisions of subsection (c) that are applicable to 

5 contracts renewed pursuant to subsection (a). Any 

6 existing contract entered into pursuant to paragraph 

7 (1) shall be terminated at the request of the owner 

8 of the project, and replaced by a contract under this 

9 paragraph.’’. 

10 SEC. 503. ENCOURAGING CONTINUED PARTICIPATION IN 

11 ASSISTED HOUSING PROGRAMS. 

12 (a) ELIMINATION OF DISCRIMINATORY RENEWAL

13 TERMS.—Paragraph (3) of section 524(b) of the Multi14 family Assisted Housing Reform and Affordability Act of 

15 1997 (42 U.S.C. 1437f note) is amended— 

16 (1) in the matter preceding subparagraph (A), 

17 by striking ‘‘the lesser of’’ and inserting ‘‘as fol18 lows’’; and 

19 (2) by striking subparagraphs (A), (B), and (C) 

20 and inserting the following: 

21 ‘‘(A) PREVIOUSLY RENEWED PROJECTS.— 

22 In the case of a project with a contract pre23 viously renewed under this paragraph, for the 

24 first renewal occurring after the date of the en25 actment of the Housing Preservation and TenVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00134 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 ant Protection Act of 2010, at a rent level de2 termined in accordance paragraph (1)(B) of 

3 this subsection. 

4 ‘‘(B) PROJECTS NOT PREVIOUSLY RE5 NEWED.—In the case of a project with a con6 tract not previously renewed under this para7 graph, at a rent level determined in accordance 

8 with paragraph (1) of this subsection.’’. 

9 (b) SUBSEQUENT RENEWALS AND RENT ADJUST10 MENTS.—Paragraph (1) of section 524(c) of the Multi11 family Assisted Housing Reform and Affordability Act of 

12 1997 (42 U.S.C. 1437f note) is amended in the first sen13 tence by striking ‘‘(b)(1)’’ and inserting ‘‘(b)(1), (b)(3)’’. 

14 SEC. 504. PREPAYMENT OF FHA MORTGAGES ON MULTI15 FAMILY HOUSING. 

16 (a) CONDITIONS FOR PREPAYMENT.—Section 250 of 

17 the National Housing Act (12 U.S.C. 1715z–15) is 

18 amended— 

19 (1) in subsection (a)— 

20 (A) by striking paragraph (1) and insert21 ing the following new paragraph: 

22 ‘‘(1) the Secretary has determined that— 

23 ‘‘(A) such project is no longer meeting a 

24 need for rental housing for lower income fami25 lies in the area, as evidenced by a persistent 


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1 lack of demand for the units under the rent 

2 schedule approved by the Secretary; or 

3 ‘‘(B) the prepayment is part of a trans4 action to preserve and improve the project as 

5 affordable housing, pursuant to the guidance in 

6 effect that implements section 236(e)(2) of this 

7 Act (12 U.S.C. 1715z–1(e)2)) or pursuant to 

8 additional administrative guidance, ensuring 

9 that— 

10 ‘‘(i) the proceeds of any refinancing 

11 will be used for rehabilitation of the 

12 project and related costs or for affordable 

13 housing and related social services under a 

14 plan approved by the Secretary; 

15 ‘‘(ii) tenants will not be displaced 

16 from the project; 

17 ‘‘(iii) rent burdens for unassisted ten18 ants as a result of the transaction will not 

19 be increased by more than 10 percent an20 nually or 20 percent in total, unless addi21 tional project-based assistance is provided; 

22 and 

23 ‘‘(iv) binding commitments, which 

24 shall apply to current and subsequent own25 ers, are made to ensure that the project 


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1 will operate in accordance with all cur2 rently applicable low-income affordability 

3 restrictions for a period of not less than 

4 the original mortgage term plus an addi5 tional 20 years, including a duty to main6 tain a substantially similar occupancy pro7 file for the project of low-, very low-, and 

8 extremely low-income tenants, to renew 

9 any expiring rental assistance contracts for 

10 the project, and accept additional rental 

11 assistance for the project.’’; 

12 (B) in paragraph (2)— 

13 (i) in subparagraph (A), by inserting 

14 before the semicolon at the end the fol15 lowing: ‘‘which shall include reasonable ac16 cess to all information relevant to the re17 quest, including the anticipated sources 

18 and uses of proceeds, any additional fi19 nancing, subsidies, and rental assistance, 

20 and any proposed rehabilitation plan, af21 fordable housing and services plan, or use 

22 agreement’’; and 

23 (ii) in subparagraph (C), by inserting 

24 before the semicolon the following: ‘‘in 


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1 making the determination required by 

2 paragraph (1)’’; 

3 (C) in paragraph (3), by striking the pe4 riod at the end and inserting ‘‘; and’’; and 

5 (D) by adding at the end the following new 

6 paragraph: 

7 ‘‘(4) the Secretary has ensured that such pre8 payment or termination involves extension of any 

9 low-income affordability restrictions (as such term is 

10 defined in section 229 of the Low-Income Housing 

11 Preservation and Resident Homeownership Act of 

12 1990 (12 U.S.C. 4119) for the project for a period 

13 of not less than 30 years.’’. 

14 (b) USE OF PROCEEDS OF PRESERVATION TRANS15 ACTIONS BY NONPROFIT OWNERS OF MULTIFAMILY

16 PROJECTS; SECTION 236 TRANSACTIONS; CLARIFICATION

17 OF EFFECT.—Section 250 of the National Housing Act 

18 (12 U.S.C. 1715z–15) is amended by adding at the end 

19 the following new subsections: 

20 ‘‘(d) USE OF PROCEEDS FROM PRESERVATION

21 TRANSACTION.—Notwithstanding any other provision of 

22 law, in connection with a preservation transaction, the pre23 payment of a mortgage on a multifamily rental housing 

24 project or termination of an insurance contract pursuant 

25 to section 229, or the sale or refinancing of a multifamily 


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1 rental housing project for which approval of the Secretary 

2 is required, the Secretary may not, in any manner that 

3 is not equally applicable to a for-profit owner of such a 

4 project— 

5 ‘‘(1) impose on any owner of such a project 

6 that is a nonprofit organization or controlled by a 

7 nonprofit organization any limitation on the right of 

8 such owner to use the proceeds of such preservation 

9 transaction for the affordable housing mission (in10 cluding tenant and supportive services) of such orga11 nization, except that any increase in the project12 based rental assistance shall be used solely to cover 

13 the cost of actual debt service, customary operating 

14 costs, and project reserve requirements, and for any 

15 rehabilitation of the project and reasonably related 

16 costs, and not for cash distributions or proceeds 

17 made to any project owner or purchaser; or 

18 ‘‘(2) restrict the right of any owner of such a 

19 project that is a nonprofit organization or controlled 

20 by a nonprofit organization to do business, in con21 nection with any affiliate or entity in which it has 

22 a financial interest. 

23 ‘‘(e) SECTION 236 DECOUPLING REFINANCING

24 TRANSACTIONS.—In the case of a decoupling refinancing 

25 transaction under section 236, the Secretary may not 


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1 enter into any agreement that establishes an escrow for 

2 the payment of future section 8 rent increases from sales 

3 proceeds funded by low-income housing tax credit equity 

4 and any such agreement already entered into shall be con5 sidered unenforceable, shall be rescinded, and may be re6 issued without the void condition. 

7 ‘‘(f) APPLICABILITY.—Notwithstanding any existing 

8 administrative directive of the Secretary to the contrary, 

9 except as specifically authorized in this section, this sec10 tion shall apply to the prepayment of any multifamily 

11 mortgage on any property insured or held by the Secretary 

12 under this Act for which the approval of the Secretary 

13 is required for prepayment of the mortgage.’’. 

14 SEC. 505. PERIOD OF ELIGIBILITY FOR NONPROFIT DEBT 

15 RELIEF. 

16 Section 517(a)(5) of the Multifamily Assisted Hous17 ing Reform and Affordability Act of 1997 (42 U.S.C. 

18 1437f note) is amended by adding at the end the following 

19 new sentences: ‘‘If such purchaser acquires such project 

20 subsequent to the date of recordation of the affordability 

21 agreement described in section 514(e)(6), (A) the pur22 chaser must acquire the project on or before the later of 

23 (i) seven years after the date of recordation of the afford24 ability agreement and (ii) two years after the date of en25 actment of this sentence; and (B) the Secretary must have 


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1 received, and determined acceptable, the purchaser’s ap2 plication for modification, assignment, or forgiveness prior 

3 to the purchaser’s acquisition of the project. In the event 

4 any low-income housing tax credits, State or local funds, 

5 tax-exemption or other affordable housing resources are 

6 being utilized by the purchaser in connection with the 

7 transfer of the property, the Secretary shall not require 

8 any repayment in connection with the assignment or for9 giveness of the mortgages to the purchaser.’’. 

10 SEC. 506. ACQUISITION OF RESTRUCTURED PROJECTS BY 

11 NONPROFIT ORGANIZATIONS. 

12 Paragraph (5) of section 517(a) of the Multifamily 

13 Assisted Housing Reform and Affordability Act of 1997 

14 (42 U.S.C. 1437 note) is amended by inserting ‘‘, or the 

15 sole general partner of the limited partnership owning the 

16 project,’’ after ‘‘if the project’’. 

17 SEC. 507. RENT ADJUSTMENTS UPON SUBSEQUENT RENEW18 ALS OF SECTION 8 CONTRACTS. 

19 Section 524(c) of the Multifamily Assisted Housing 

20 Reform and Affordability Act of 1997 (42 U.S.C. 1437f 

21 note) is amended by adding at the end the following new 

22 paragraph: 

23 ‘‘(3) SUBSEQUENT RENEWALS.—At the request 

24 of the owner of the project, a contract initially re25 newed pursuant to this section may subsequently be 


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1 renewed under any renewal authority in this section 

2 for which it is eligible. The subsequent renewal of a 

3 contract initially renewed under subsection (b)(1) 

4 shall be at rents established in accordance with 

5 paragraph (1) of this subsection. A project whose 

6 contract is initially renewed under this section shall 

7 not be considered an eligible multifamily housing 

8 project as defined in section 512(2) unless (A) the 

9 owner of the project and the Secretary consent to 

10 the project’s designation as an eligible multifamily 

11 housing project, and (B) the project meets the re12 quirements of subparagraphs (A) and (C) of such 

13 section 512(2).’’. 

14 SEC. 508. BUDGET-BASED RENT ADJUSTMENTS. 

15 (a) METHODS FOR ANNUAL RENT ADJUSTMENTS.— 

16 Section 514(g) of the Multifamily Assisted Housing Re17 form and Affordability Act of 1997 (42 U.S.C. 1437f 

18 note) is amended by adding at the end the following new 

19 paragraph: 

20 ‘‘(4) ANNUAL RENT ADJUSTMENTS.—The Sec21 retary shall annually adjust the rents initially estab22 lished pursuant to this section using an operating 

23 cost adjustment factor established by the Secretary 

24 (which shall not result in a negative adjustment) or, 


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1 upon the request of the project owner, on a budget 

2 basis.’’ 

3 (b) MEETING REHABILITATION NEEDS OF PRE4 VIOUSLY RESTRUCTURED PROJECTS.—Section 517(c) of 

5 the Multifamily Assisted Housing Reform and Afford6 ability Act of 1997 (42 U.S.C. 1437f note) is amended 

7 by adding at the end the following new paragraph: 

8 ‘‘(3) REHABILITATION NEEDS OF RESTRUC9 TURED PROJECTS.— 

10 ‘‘(A) REHABILITATION ASSISTANCE.—Not11 withstanding any other provision of this title, at 

12 the request of a project owner, the Secretary 

13 shall, pursuant to a revised evaluation of the 

14 physical condition of the project approved by 

15 the Secretary, provide rehabilitation assistance 

16 from the funding sources specified in the first 

17 sentence of paragraph (1)(A) for any project 

18 for which the Secretary and the project owner 

19 executed a mortgage restructuring and rental 

20 assistance sufficiency plan prior to October 1, 

21 2001, pursuant to which mortgage debt on the 

22 project was restructured. 

23 ‘‘(B) FUNDING THROUGH DEBT RESTRUC24 TURING.—The Secretary may, in connection 

25 with the transfer of a project to a qualified 


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1 preservation owner, modify or waive any of the 

2 requirements or conditions on debt restruc3 turing contained in this title in order to provide 

4 a simplified debt restructuring for funding the 

5 rehabilitation of previously restructured projects 

6 under this title. The Secretary may make a 

7 non-default partial or full payment of claim 

8 under a mortgage insurance contract pursuant 

9 to section 541(b) of the National Housing Act 

10 (12 U.S.C. 1735f–19(b)), notwithstanding the 

11 limitation in section 541(b) to its one-time use. 

12 The Secretary may also modify or waive any re13 quirement or condition in such section 541(b) 

14 that the Secretary considers inconsistent with 

15 the simplified debt restructuring authorized by 

16 this paragraph. 

17 ‘‘(C) CONTRIBUTION.—The project owner 

18 receiving rehabilitation assistance under this 

19 paragraph shall not be required to make the 

20 contribution specified in paragraph (1)(B) or 

21 (2)(C), except to the extent the Secretary in22 creases project rents to provide for a return of 

23 the owner’s contribution over such period as the 

24 Secretary shall determine.’’. 


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1 SEC. 509. INDEPENDENT APPRAISAL REQUIREMENT IN 

2 CASES OF DIVERGENT RENT STUDIES. 

3 Section 524(a)(5) of the Multifamily Assisted Hous4 ing Reform and Affordability Act of 1997 (42 U.S.C. 

5 1437f note) is amended by adding at the end the following 

6 new sentence: ‘‘In connection with a contract renewal 

7 under this section or section 515, if the comparable mar8 ket rent determination made by the Secretary and the 

9 owner’s appraiser differ by 15 percent or more, the owner 

10 may request a third appraiser, jointly selected and com11 pensated by the Secretary and the owner, to make a com12 parable market rent determination that shall be binding 

13 on both parties.’’. 

14 SEC. 510. EXTENSION OF HOUSING ASSISTANCE PAYMENT 

15 CONTRACT. 

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

17 Assisted Housing Reform and Affordability Act of 1997 

18 (42 U.S.C. 1437f note) is amended by adding at the end 

19 the following new paragraph: 

20 ‘‘(6) EXTENSION OF CONTRACT TERM.—In con21 nection with the refinancing or sale of a project cov22 ered by a contract renewed under this subsection, 

23 the Secretary shall, at the request of the owner, 

24 amend the contract to extend the term to 30 years 

25 or such shorter term as the owner may request. 

26 Such an extension shall be subject to the availability 


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1 of sufficient amounts provided in appropriation 

2 Acts.’’. 

3 (b) EXCEPTION RENT PROJECTS.—Section 524(b) of 

4 the Multifamily Assisted Housing Reform and Afford5 ability Act of 1997 (42 U.S.C. 1437f note) is amended 

6 by adding at the end the following new paragraph: 

7 ‘‘(4) EXTENSION OF CONTRACT TERM.—In con8 nection with the refinancing or sale of a project cov9 ered by a contract renewed under this subsection, 

10 the Secretary shall, at the request of the owner, 

11 amend the contract to extend the term to 30 years 

12 or such shorter term as the owner may request. 

13 Such an extension shall be subject to the availability 

14 of sufficient amounts provided in appropriation 

15 Acts’’. 

16 SEC. 511. OTHERWISE ELIGIBLE PROJECTS. 

17 Section 514 of the Multifamily Assisted Housing Re18 form and Affordability Act of 1997 (42 U.S.C. 1437f 

19 note) is amended by adding at the end the following new 

20 subsection: 

21 ‘‘(i) OTHER ELIGIBLE PROJECTS.— 

22 ‘‘(1) IN GENERAL.—Notwithstanding any other 

23 provision of this subtitle, a project that meets the re24 quirements of subparagraphs (B) and (C) of section 

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1 paragraph (A) of section 512(2), may be treated as 

2 an eligible multifamily housing project on an excep3 tion basis if the Secretary determines, subject to 

4 paragraph (2), that such treatment is necessary to 

5 preserve the project in the most cost-effective man6 ner in relation to other alternative preservation op7 tions. 

8 ‘‘(2) OWNER REQUEST.— 

9 ‘‘(A) REQUEST REQUIRED.—The Secretary 

10 shall not treat an otherwise eligible project de11 scribed under paragraph (1) as an eligible mul12 tifamily housing project unless the owner of the 

13 project requests such treatment. 

14 ‘‘(B) NO ADVERSE TREATMENT IF NO RE15 QUEST MADE.—If the owner of a project does 

16 not make a request under subparagraph (A), 

17 the Secretary shall not withhold from such 

18 project any other available preservation option. 

19 ‘‘(3) CANCELLATION.— 

20 ‘‘(A) TIMING.—At any time prior to the 

21 completion of a mortgage restructuring under 

22 this subtitle, the owner of a project may— 

23 ‘‘(i) withdraw any request made under 

24 paragraph (2)(A); and 


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1 ‘‘(ii) pursue any other option with re2 spect to the renewal of such owner’s sec3 tion 8 contract pursuant to any applicable 

4 statute or regulation. 

5 ‘‘(B) DOCUMENTATION.—If an owner of a 

6 project withdraws such owner’s request and 

7 pursues other renewal options under this para8 graph, such owner shall be entitled to submit 

9 documentation or other information to replace 

10 the documentation or other information used 

11 during processing for mortgage restructuring 

12 under this subtitle. 

13 ‘‘(4) LIMITATION.—The Secretary may exercise 

14 the authority to treat projects as eligible multifamily 

15 housing projects pursuant to this subsection only to 

16 the extent that the number of units in such projects 

17 do not exceed 10 percent of all units for which mort18 gage restructuring pursuant to section 517 is com19 pleted.’’. 

20 SEC. 512. EXCEPTION RENTS. 

21 In the matter preceding clause (i) of section 

22 514(g)(2)(A) of the Multifamily Assisted Housing Reform 

23 and Affordability Act of 1997 (42 U.S.C. 1437f note) is 

24 amended— 


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1 (1) by inserting ‘‘disaster-damaged eligible 

2 projects and’’ after ‘‘waive this limit for’’; and 

3 (2) by striking ‘‘five percent of all units’’ and 

4 inserting ‘‘9 percent of all units’’. 

5 SEC. 513. DISASTER-DAMAGED ELIGIBLE PROJECTS. 

6 (a) MARKET RENT DETERMINATION.—Section 

7 514(g)(1)(B) of the Multifamily Assisted Housing Reform 

8 and Affordability Act of 1997 (42 U.S.C. 1437f note) is 

9 amended by striking ‘‘determined, are equal’’ and insert10 ing the following: ‘‘determined— 

11 ‘‘(i) with respect to a disaster-dam12 aged property, are equal to 100 percent of 

13 the fair market rents for the relevant mar14 ket area (as such rents were in effect at 

15 the time of such disaster); and 

16 ‘‘(ii) with respect to other eligible 

17 multifamily housing projects, are equal’’. 

18 (b) OWNER INVESTMENT.—Section 517(c) of the 

19 Multifamily Assisted Housing Reform and Affordability 

20 Act of 1997 (42 U.S.C. 1437f note) is amended by adding 

21 at the end the following: 

22 ‘‘(3) PROPERTIES DAMAGED BY NATURAL DIS23 ASTERS.—With respect to a disaster-damaged eligi24 ble property, the owner contribution toward rehabiliVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00149 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 tation needs shall be determined in accordance with 

2 paragraph (2)(C).’’. 

3 SEC. 514. FUNDING FOR TENANT AND OTHER PARTICIPA4 TION AND CAPACITY BUILDING. 

5 Paragraph (3) of section 514(f) of the Multifamily 

6 Assisted Housing Reform and Affordability Act of 1997 

7 (42 U.S.C. 1437f note) is amended— 

8 (1) in subparagraph (A)— 

9 (A) in the first sentence— 

10 (i) by striking ‘‘not more than’’ and 

11 inserting ‘‘not less than’’; 

12 (ii) by striking ‘‘of low-income housing 

13 for which project-based rental assistance is 

14 provided at below market rent levels and 

15 may not be renewed’’ and inserting the fol16 lowing: ‘‘and improvement of low-income 

17 housing for which project-based rental as18 sistance, subsidized loans, or enhanced 

19 vouchers under section 8(t) are provided’’; 

20 and 

21 (iii) in the second parenthetical 

22 clause, by inserting before the closing pa23 renthesis the following: ‘‘, and 

24 predevelopment assistance to enable such 

25 transfers’’; and 


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1 (B) by inserting after the period at the end 

2 the following: ‘‘For outreach and training of 

3 tenants and technical assistance, the Secretary 

4 shall implement a grant program utilizing per5 formance-based outcome measures for eligible 

6 costs incurred. Recipients providing capacity 

7 building or technical assistance services to ten8 ant groups shall be qualified nonprofit State9 wide, countywide, area-wide or citywide organi10 zations with demonstrated experience including 

11 at least a two-year recent track record of orga12 nizing and providing assistance to tenants, and 

13 independence from the owner, a prospective 

14 purchaser, or their managing agents. The Sec15 retary may provide assistance and training to 

16 grantees in administrative and fiscal manage17 ment to ensure compliance with applicable Fed18 eral requirements. The Secretary shall expedite 

19 the provision of funding for the fiscal year in 

20 which the date of the enactment of the Housing 

21 Preservation and Tenant Protection Act of 

22 2010 occurs by entering into new multi-year 

23 contracts with any prior grantee without ad24 verse audit findings or whose adverse audit 

25 findings have been cleared, and by entering into 


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1 an interagency agreement for not less than 

2 $1,000,000 with the Corporation for National 

3 and Community Service or any other agency of 

4 the Federal Government, that is selected by the 

5 Secretary and the Secretary determines is 

6 qualified to conduct such program, to conduct 

7 a tenant outreach and training program under 

8 the same or similar terms and conditions as 

9 was most recently conducted by the Corpora10 tion. The Secretary shall also make available 

11 flexible grants to qualified nonprofit organiza12 tions that do not own eligible multifamily prop13 erties, for tenant outreach in underserved areas, 

14 and to experienced national or regional non15 profit organizations to provide specialized train16 ing or support to grantees assisted under this 

17 section. Notwithstanding any other provision of 

18 law, funds authorized under this section for any 

19 fiscal year shall be available for obligation in 

20 subsequent fiscal years. The Secretary shall re21 quire each recipient of amounts made available 

22 pursuant to this subparagraph to submit to the 

23 Secretary reports, on a quarterly basis, detail24 ing the use of such funds and including such in25 formation as the Secretary shall require.’’; and 


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1 (2) by adding at the end the following new sub2 paragraphs: 

3 ‘‘(D) PROHIBITIONS.—None of the funds 

4 made available under subparagraph (A) may be 

5 used for any political activities, political advo6 cacy, or lobbying (as such terms are defined by 

7 Circular A–122 of the Office of Management 

8 and Budget, entitled ‘Cost Principles for Non9 Profit Organizations’), or for expenses for trav10 el to engage in political activities or preparation 

11 of or provision of advice on tax returns. 

12 ‘‘(E) PROGRAM COMPLIANCE SYSTEMS.— 

13 Each recipient of amounts made available under 

14 subparagraph (A) shall develop systems to en15 sure compliance with the program and the re16 quirements of this paragraph. 

17 ‘‘(F) PENALTIES.—The Secretary may im18 pose penalties on any recipient of amounts 

19 made available under subparagraph (A) that 

20 fails to comply with any requirement under this 

21 paragraph or of the program established pursu22 ant to this paragraph, which penalties may in23 clude— 


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1 ‘‘(i) ineligibility for further assistance 

2 from amounts made available under sub3 paragraph (A); and 

4 ‘‘(ii) requiring the recipient to reim5 burse the Secretary for any amounts that 

6 were so misused.’’. 

7 TITLE VI—PRESERVATION 

8 DATABASE 

9 SEC. 601. PRESERVATION DATABASE. 

10 (a) UNIQUE IDENTIFIER.—The Secretary of Housing 

11 and Urban Development, in consultation with the Sec12 retary of Agriculture, shall establish a unique alpha13 numeric identifier for each covered multifamily property 

14 (as such term is defined in subsection (i)). A property 

15 shall have only one such identifier, regardless of whether 

16 such property is receiving more than one of the forms of 

17 assistance identified in subsection (i). 

18 (b) PUBLIC AVAILABILITY OF INFORMATION.—The 

19 Secretary of Housing and Urban Development shall re20 quire the submission of information and make publicly 

21 available such information about each covered multifamily 

22 property, which information shall include the following: 

23 (1) The unique identifier for the property estab24 lished pursuant to subsection (a). 

25 (2) The name of the property. 


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1 (3) The address and geographical coordinates of 

2 the property. 

3 (4) The name of, and contact information for, 

4 the owner (or owners) or sponsor (or sponsors) of 

5 the property. 

6 (5) A characterization of the type of owners or 

7 sponsors of the property (such as nonprofit or for8 profit). 

9 (6) The name of, and contact information for, 

10 the property management company. 

11 (7) The year that the property was built or 

12 placed in service. 

13 (8) The total number of dwelling units in the 

14 property. 

15 (9) The total number of dwelling units in the 

16 property of each size (such as studio units, 1-bed17 room units, or 2-bedroom units). 

18 (10) The average income of tenants residing in 

19 dwelling units in the property receiving project-based 

20 rental assistance, according to the most recent avail21 able information. 

22 (11) For each size of dwelling unit in the prop23 erty, the contract rents for such dwelling units. 

24 (12) For each size of dwelling unit in the prop25 erty, the ratio of the contract rents for such dwelling 


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1 units to the fair market rent established under sec2 tion 8(c) of the United States Housing Act of 1937 

3 for such size dwelling units for the area in which the 

4 property is located. 

5 (13) The most recent 3 scores for the property 

6 for any physical inspections, including any real es7 tate assessment center (REAC) scores for the prop8 erty, and the dates of such inspections. 

9 (14) Indicators of the financial condition of the 

10 property, which may include notification of any fore11 closure proceedings on the property and any bank12 ruptcy filings by the entity holding title to the prop13 erty. 

14 (15) The form or forms of assistance identified 

15 in subsection (i) that are provided for the property. 

16 (16) For each form of assistance identified in 

17 subsection (i) that is provided for the property, the 

18 total number of dwelling units in the property for 

19 which such assistance is provided. 

20 (17) For each form of assistance identified in 

21 subsection (i) that is provided for the property, the 

22 total number of assisted dwelling units in the prop23 erty of each size (such as studio units, 1-bedroom 

24 units, and 2-bedroom units). 


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1 (18) For each form of assistance identified in 

2 subsection (i) that is provided for the property, a 

3 characterization of occupancy restrictions applicable 

4 to the property (such as restrictions limiting occu5 pancy to only elderly, disabled, or families). 

6 (19) For each form of assistance identified in 

7 subsection (i) that is provided for the property, any 

8 limitations on the incomes of tenants applicable to 

9 the assistance. 

10 (20) For each form of assistance identified in 

11 subsection (i) that is provided for the property, the 

12 day, month, and year that any affordability or low13 income use restrictions applicable to the property 

14 first applied. 

15 (21) For each form of assistance identified in 

16 subsection (i) that is provided for the property, the 

17 day, month, and year that any affordability or low18 income use restrictions applicable to the property 

19 will terminate. 

20 (22) For each form of assistance identified in 

21 subsection (i) that is provided for the property, the 

22 day, month, and year of any early termination date 

23 for such form of assistance after which any afford24 ability or low-income use restrictions will not nec25 essarily apply to the property (such as the termiVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00157 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 nation of the compliance period for any low-income 

2 housing tax credit for the property or the date that 

3 a loan or mortgage for the property held or insured 

4 by the Secretary is first eligible for prepayment). 

5 (23) Any notices, plans, and information relat6 ing to the property required under the Low-Income 

7 Housing Preservation and Resident Homeownership 

8 Act of 1990 (12 U.S.C. 4101 et seq.), including any 

9 notice of intent to prepay a mortgage under section 

10 212 of such Act, information provided under section 

11 216 of such Act by the Secretary, second notice of 

12 intent under section 216(d) of such Act, plan of ac13 tion under section 217 of such Act, and notice of ap14 proval of a plan of action under section 225 of such 

15 Act. 

16 (24) Any notice of a request to terminate an in17 surance contract under title II of the National 

18 Housing Act for a loan or mortgage on the property. 

19 (25) Any notice of a request to prepay a loan 

20 or mortgage on the property insured under title II 

21 of the National Housing Act and an indication of 

22 whether such request was made in conjunction with 

23 a refinance application under such title. 

24 (26) Any notice under section 8(c)(8) of the 

25 United States Housing Act of 1937 of proposed terVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00158 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 mination of an assistance contract under such sec2 tion for the property. 

3 (27) A description of any notice indicating an 

4 intention of the owner in selling the property. 

5 (28) Any other information as the Secretary or 

6 the designee of the Secretary determines is appro7 priate. 

8 (c) MEANS.— 

9 (1) AVAILABILITY THROUGH WORLD WIDE

10 WEB.—The information made available pursuant to 

11 subsection (b) shall be made available to the public 

12 through a World Wide Web site of the Department 

13 of Housing and Urban Development. 

14 (2) SEARCHABLE ELECTRONIC DATABASE.— 

15 Such information shall be made available in a 

16 searchable electronic database format that allows for 

17 the data for each of the forms of assistance specified 

18 in subsection (i) to be aggregated in a single data19 base. 

20 (3) USE OF EXISTING SYSTEMS AND DATA21 BASES.—The requirements of subsection (b) may be 

22 met by adapting existing systems or databases to in23 clude the unique identifier established pursuant to 

24 subsection (a) and the information specified in sub25 section (b). 


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1 (4) ANNUAL AND QUARTERLY LIST.—At least 

2 annually, the Secretary shall update and make avail3 able a list of properties receiving one of more forms 

4 of assistance specified in subsection (i). At least on 

5 a quarterly basis, the Secretary shall make available 

6 through a World Wide Web site of the Department 

7 of Housing and Urban Development a list of prop8 erties receiving one or more forms of assistance 

9 specified in subsection (i). Each such annual and 

10 quarterly list shall include, for each such property, 

11 the unique identifier established pursuant to sub12 section (a) and the information specified in para13 graphs (1) through (3) of subsection (b). 

14 (d) UPDATING.—The information made available 

15 pursuant to subsection (b) shall be updated not less than 

16 annually or in accordance with any rules or practice appli17 cable to the subsidy program involved that require infor18 mation to be made available more frequently. Any histor19 ical databases shall remain available to the public through 

20 a World Wide Web site of the Department of Housing and 

21 Urban Development. 

22 (e) INITIAL AVAILABILITY.—The Secretary of Hous23 ing and Urban Development shall make information ini24 tially publicly available pursuant to this section not later 


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1 than the expiration of the 18-month period beginning on 

2 the date of the enactment of this Act. 

3 (f) INFORMATION FROM DEPARTMENT OF AGRI4 CULTURE.—The Secretary of Agriculture shall take such 

5 actions as may be necessary to ensure that information 

6 regarding any covered multifamily properties described in 

7 paragraphs (1)(E) and (3)(G) of subsection (i) that is suf8 ficient for the Secretary of Housing and Urban Develop9 ment to comply with the requirements of this section, with 

10 respect to such properties, is timely made available to the 

11 Secretary of Housing and Urban Development. 

12 (g) INFORMATION FROM SECRETARY OF THE TREAS13 URY.—The Secretary of the Treasury shall take such ac14 tions as may be necessary to ensure that information re15 garding any covered multifamily properties described in 

16 paragraphs (4) and (6) of subsection (i) that is sufficient 

17 for the Secretary of Housing and Urban Development to 

18 comply with the requirements of this section, with respect 

19 to such properties, is timely made available to the Sec20 retary of Housing and Urban Development. 

21 (h) GRANTS TO STATES AND LOCALITIES.— 

22 (1) AUTHORITY.—The Secretary of Housing 

23 and Urban Development shall, to the extent amounts 

24 are made available for grants under this subsection, 

25 make grants to States and units of local government 


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1 to enable such entities to collect and make available 

2 to the public information about State and local as3 sistance provided to covered multifamily properties 

4 identified in databases developed by the Secretary 

5 pursuant to this section or to other properties as6 sisted by such States and units of local government. 

7 (2) AUTHORIZATION OF APPROPRIATIONS.— 

8 There is authorized to be appropriated to the Sec9 retary of Housing and Urban Development for 

10 grants under this subsection such sums as may be 

11 necessary in each fiscal year to carry out this sub12 section. 

13 (i) COVERED MULTIFAMILY PROPERTIES.—For pur14 poses of this section, the term ‘‘covered multifamily prop15 erty’’ means a property consisting of more than 4 rental 

16 dwelling units, which property— 

17 (1) is covered in whole or in part by a contract 

18 for assistance that is attached to the structure 

19 under— 

20 (A) section 8 of the United States Housing 

21 Act of 1937 (42 U.S.C. 1437f), including— 

22 (i) subsections (b) and (o)(13) of such 

23 section 8; 

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1 tion 8(b)(2), as in effect before October 1, 

2 1983; 

3 (iii) the property disposition program 

4 under such section 8(b); 

5 (iv) the moderate rehabilitation pro6 gram under such section 8(e)(2); and 

7 (v) the loan management assistance 

8 program under such section 8; 

9 (B) section 23 of the United States Hous10 ing Act of 1937, as in effect before January 1, 

11 1975; 

12 (C) the rent supplement program under 

13 section 101 of the Housing and Urban Develop14 ment Act of 1965 (12 U.S.C. 1701s); 

15 (D) section 8 of the United States Housing 

16 Act of 1937, following conversion from assist17 ance under section 101 of the Housing and 

18 Urban Development Act of 1965; or 

19 (E) section 521 of the Housing Act of 

20 1949 (42 U.S.C. 1490a); 

21 (2) is financed by a mortgage insured or held 

22 by the Secretary under title II of the National Hous23 ing Act (12 U.S.C. 1707 et seq.); 

24 (3) receives assistance that is attached to the 

25 structure pursuant to— 


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1 (A) section 202 of the Housing Act of 

2 1959 (12 U.S.C. 1701q), including properties 

3 receiving assistance prior to the enactment of 

4 the Cranston-Gonzalez National Affordable 

5 Housing Act; 

6 (B) section 811 of the Cranston-Gonzalez 

7 National Affordable Housing Act (42 U.S.C. 

8 8013); 

9 (C) section 5 or 9 of the United States 

10 Housing Act of 1937 (42 U.S.C. 1437c, 

11 1437g); 

12 (D) title II of the Cranston-Gonzalez Na13 tional Affordable Housing Act (42 U.S.C. 

14 12721 et seq.); 

15 (E) subtitle D of title VIII of the Cran16 ston-Gonzalez National Affordable Housing Act 

17 (42 U.S.C. 12901 et seq.); 

18 (F) title IV of the McKinney-Vento Home19 less Assistance Act (12 U.S.C. 11301 et seq.); 

20 or 

21 (G) sections 514, 515, or 516 of the Hous22 ing Act of 1949 (42 U.S.C. 1484, 1485); 

23 (4) is financed in whole or part with low-income 

24 housing tax credits pursuant to section 42 of the In25 ternal Revenue Code of 1986 (26 U.S.C. 42); 


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1 (5) is financed in whole or part with amounts 

2 from the Housing Trust Fund established under sec3 tion 1338 of the Federal Housing Enterprises Fi4 nancial Safety and Soundness Act of 1992 (12 

5 U.S.C. 4568); or 

6 (6) is financed in whole or in part with the pro7 ceeds from a bond issued pursuant to section 141 or 

8 142 of the Internal Revenue Code of 1986 (26 

9 U.S.C. 141, 142). 

10 (j) PROTECTION OF INFORMATION.—This title shall 

11 not be construed to require disclosure of Social Security 

12 numbers, personal tax returns, or any other personal fi13 nancial information of or concerning individuals who have 

14 an interest in the ownership or management entities of 

15 covered housing. 

16 TITLE VII—SECTION 202 SUP17 PORTIVE HOUSING FOR THE 

18 ELDERLY 

19 SEC. 701. SHORT TITLE AND TABLE OF CONTENTS. 

20 This title may be cited as the ‘‘Section 202 Sup21 portive Housing for the Elderly Act of 2010’’. 


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1 Subtitle A—New Construction 

2 Reforms 

3 SEC. 711. PROJECT RENTAL ASSISTANCE. 

4 Paragraph (2) of section 202(c) of the Housing Act 

5 of 1959 (12 U.S.C. 1701q(c)(2)) is amended— 

6 (1) by inserting after ‘‘ASSISTANCE.—’’ the fol7 lowing: ‘‘(A) INITIAL PROJECT RENTAL ASSISTANCE

8 CONTRACT.—’’; 

9 (2) in the last sentence, by striking ‘‘may’’ and 

10 inserting ‘‘shall’’; and 

11 (3) by adding at the end the following new sub12 paragraph: 

13 ‘‘(B) RENEWAL OF AND INCREASES IN CON14 TRACT AMOUNTS.— 

15 ‘‘(i) EXPIRATION OF CONTRACT TERM.— 

16 Upon the expiration of each contract term, the 

17 Secretary shall adjust the annual contract 

18 amount to provide for reasonable project costs, 

19 and any increases, including adequate reserves, 

20 supportive services, and service coordinators. 

21 ‘‘(ii) EMERGENCY SITUATIONS.—In the 

22 event of emergency situations that are outside 

23 the control of the owner, the Secretary shall in24 crease the annual contract amount, subject to 


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1 reasonable review and limitations as the Sec2 retary shall provide.’’. 

3 SEC. 712. SELECTION CRITERIA. 

4 Section 202(f)(1) of the Housing Act of 1959 (12 

5 U.S.C. 1701q(f)) is amended— 

6 (1) by redesignating subparagraphs (F) and 

7 (G) as subparagraphs (G) and (H), respectively; and 

8 (2) by inserting after subparagraph (E): 

9 ‘‘(F) the extent to which the applicant has en10 sured that a service coordinator will be employed or 

11 otherwise retained for the housing, who has the 

12 managerial capacity and responsibility for carrying 

13 out the actions described in subparagraphs (A) and 

14 (B) of subsection (g)(2);’’. 

15 SEC. 713. DEVELOPMENT COST LIMITATIONS. 

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

17 U.S.C. 1701q(h)(1)) is amended, in the matter preceding 

18 subparagraph (A), by inserting ‘‘reasonable’’ before ‘‘de19 velopment cost limitations’’. 

20 SEC. 714. OWNER DEPOSITS. 

21 Section 202(j)(3)(A) of the Housing Act of 1959 (12 

22 U.S.C. 1701q(j)(3)(A)) is amended by inserting after the 

23 period at the end the following: ‘‘Such amount shall be 

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1 struction shortfalls or inadequate initial project rental as2 sistance amounts.’’. 

3 SEC. 715. DEFINITION OF PRIVATE NONPROFIT ORGANIZA4 TION. 

5 Paragraph (4) of section 202(k) of the Housing Act 

6 of 1959 (12 U.S.C. 1701q(k)(4)) is amended to read as 

7 follows: 

8 ‘‘(4) The term ‘‘private nonprofit organization’’ 

9 means— 

10 ‘‘(A) any incorporated private institution 

11 or foundation— 

12 ‘‘(i) no part of the net earnings of 

13 which inures to the benefit of any member, 

14 founder, contributor, or individual; 

15 ‘‘(ii) which has a governing board— 

16 ‘‘(I) the membership of which is 

17 selected in a manner to assure that 

18 there is significant representation of 

19 the views of the community in which 

20 such housing is located, except that, 

21 in the case of any organization that is 

22 the sponsor of multiple housing 

23 projects assisted under this section, 

24 the organization may comply with this 

25 subclause by having a local advisory 


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1 board for each community to the gov2 erning board of the organization, the 

3 membership of which is selected in the 

4 manner required under this subclause; 

5 and 

6 ‘‘(II) which is responsible for the 

7 operation of the housing assisted 

8 under this section; and 

9 ‘‘(iii) which is approved by the Sec10 retary as to financial responsibility; 

11 ‘‘(B) a for-profit limited partnership the 

12 sole general partner of which is— 

13 ‘‘(i) an organization meeting the re14 quirements under subparagraphs (A); or 

15 ‘‘(ii) a for-profit corporation wholly 

16 owned and controlled by one or more orga17 nizations meeting the requirements under 

18 subparagraph (A); and 

19 ‘‘(C) a limited liability company wholly 

20 owned or controlled by one or more organiza21 tions meeting the requirements under subpara22 graph (A).’’. 


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1 SEC. 716. PREFERENCES FOR HOMELESS ELDERLY. 

2 Subsection (j) of section 202 of the Housing Act of 

3 1959 (12 U.S.C. 1701q(j)) is amended by adding at the 

4 end the following new paragraph: 

5 ‘‘(9) PREFERENCES FOR HOMELESS ELDER6 LY.—The Secretary shall permit an owner of hous7 ing assisted under this section to establish for, and 

8 apply to, such housing a preference in tenant selec9 tion for the homeless elderly, either within the appli10 cation or after selection pursuant to subsection (f), 

11 but only if— 

12 ‘‘(A) such preference is consistent with 

13 paragraph (2); and 

14 ‘‘(B) the owner demonstrates that the sup15 portive services identified pursuant to sub16 section (e)(4), or additional supportive services 

17 to be made available upon implementation of 

18 the preference, will meet the needs of the home19 less elderly, maintain safety and security for all 

20 tenants, and be provided on a consistent, long21 term, and economical basis.’’. 

22 SEC. 717. NONMETROPOLITAN ALLOCATION. 

23 Paragraph (3) of section 202(l) of the Housing Act 

24 of 1959 (12 U.S.C. 1701q(l)(3)) is amended by inserting 

25 after the period at the end the following: ‘‘In complying 

26 with this paragraph, the Secretary shall either operate a 


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1 national competition for the nonmetropolitan funds or 

2 make allocations to regional offices of the Department of 

3 Housing and Urban Development.’’. 

4 Subtitle B—Refinancing 

5 SEC. 721. APPROVAL OF PREPAYMENT OF DEBT. 

6 Subsection (a) of section 811 of the American Home7 ownership and Economic Opportunity Act of 2000 (12 

8 U.S.C. 1701q note) is amended— 

9 (1) in the matter preceding paragraph (1), by 

10 inserting ‘‘, for which the Secretary’s consent to pre11 payment is required,’’ after ‘‘Affordable Housing 

12 Act)’’; 

13 (2) in paragraph (1)— 

14 (A) by inserting ‘‘at least 30 years fol15 lowing’’ before ‘‘the maturity date’’; 

16 (B) by inserting ‘‘project-based’’ before 

17 ‘‘rental assistance payments contract’’; 

18 (C) by inserting ‘‘project-based’’ before 

19 ‘‘rental housing assistance programs’’; and 

20 (D) by inserting ‘‘, or any successor 

21 project-based rental assistance program,’’ after 

22 ‘‘1701s))’’; 

23 (3) by amending paragraph (2) to read as fol24 lows: 


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1 ‘‘(2) the prepayment may involve refinancing of 

2 the loan if such refinancing results in— 

3 ‘‘(A) a lower interest rate on the principal 

4 of the loan for the project and in reductions in 

5 debt service related to such loan; or 

6 ‘‘(B) a transaction in which the project 

7 owner will address the physical needs of the 

8 project, but only if, as a result of the refi9 nancing— 

10 ‘‘(i) the rent charges for unassisted 

11 families residing in the project do not in12 crease or such families are provided rental 

13 assistance under a senior preservation 

14 rental assistance contract for the project 

15 pursuant to subsection (e); and 

16 ‘‘(ii) the overall cost for providing 

17 rental assistance under section 8 for the 

18 project (if any) is not increased, except, 

19 upon approval by the Secretary to— 

20 ‘‘(I) mark-up-to-market contracts 

21 pursuant to section 524(a)(3) of the 

22 Multifamily Assisted Housing Reform 

23 and Affordability Act of 1997 (42 

24 U.S.C. 1437f note), as such section is 

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1 erties owned by nonprofit organiza2 tions; or 

3 ‘‘(II) mark-up-to-budget con4 tracts pursuant to section 524(a)(4) 

5 of the Multifamily Assisted Housing 

6 Reform and Affordability Act of 1997 

7 (42 U.S.C. 1437f note), as such sec8 tion is carried out by the Secretary 

9 for properties owned by eligible own10 ers (as such term is defined in section 

11 202(k) of the Housing Act of 1959 

12 (12 U.S.C. 1701q(k)); and’’; and 

13 (4) by adding at the end the following: 

14 ‘‘(3) notwithstanding paragraph (2)(A), the 

15 prepayment and refinancing authorized pursuant to 

16 paragraph (2)(B) involves an increase in debt service 

17 only in the case of a refinancing of a project assisted 

18 with a loan under such section 202 carrying an in19 terest rate of 6 percent or lower.’’. 

20 SEC. 722. SOURCES OF REFINANCING. 

21 The last sentence of section 811(b) of the American 

22 Homeownership and Economic Opportunity Act of 2000 

23 (12 U.S.C. 1701q note) is amended— 

24 (1) by inserting after ‘‘National Housing Act,’’ 

25 the following: ‘‘or approving the standards used by 


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1 authorized lenders to underwrite a loan refinanced 

2 with risk sharing as provided by section 542 of the 

3 Housing and Community Development Act of 1992 

4 (12 U.S.C. 1701 note),’’; and 

5 (2) by striking ‘‘may’’ and inserting ‘‘shall’’. 

6 SEC. 723. USE OF UNEXPENDED AMOUNTS. 

7 Subsection (c) of section 811 of the American Home8 ownership and Economic Opportunity Act of 2000 (12 

9 U.S.C. 1701q note) is amended— 

10 (1) by striking ‘‘USE OF UNEXPENDED

11 AMOUNTS.—’’ and inserting ‘‘USE OF PRO12 CEEDS.—’’; 

13 (2) by amending the matter preceding para14 graph (1) to read as follows: ‘‘Upon execution of the 

15 refinancing for a project pursuant to this section, 

16 the Secretary shall ensure that proceeds are used in 

17 a manner advantageous to tenants of the project, or 

18 are used in the provision of affordable rental hous19 ing and related social services for elderly persons 

20 that are tenants of the project or of other projects 

21 assisted with a loan under section 202 of the Hous22 ing Act of 1959 (12 U.S.C. 1701q) by the private 

23 nonprofit organization project owner, private non24 profit organization project sponsor, or private non25 profit organization project developer, including—’’; 


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1 (3) in paragraph (1), by striking ‘‘not more 

2 than 15 percent of’’; 

3 (4) in paragraph (2), by inserting before the 

4 semicolon the following; ‘‘, including reducing the 

5 number of units by reconfiguring units that are 

6 functionally obsolete, unmarketable, or not economi7 cally viable’’; 

8 (5) in paragraph (3), by striking ‘‘or’’ at the 

9 end; 

10 (6) in paragraph (4), by striking ‘‘according to 

11 a pro rata allocation of shared savings resulting 

12 from the refinancing.’’ and inserting a semicolon; 

13 and 

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

15 paragraphs: 

16 ‘‘(5) rehabilitation of the project to ensure long17 term viability; 

18 ‘‘(6) the payment to the project owner, sponsor, 

19 or third party developer of a developer’s fee in an 

20 amount not to exceed or duplicate— 

21 ‘‘(A) in the case of a project refinanced 

22 through a State low income housing tax credit 

23 program, the fee permitted by the low income 

24 housing tax credit program as calculated by the 

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1 velopment cost as defined by that State pro2 gram; or 

3 ‘‘(B) in the case of a project refinanced 

4 through any other source of refinancing, 15 

5 percent of the acceptable development cost; and 

6 ‘‘(7) the payment of equity, if any, to— 

7 ‘‘(A) in the case of a sale, to the seller or 

8 the sponsor of the seller, in an amount equal to 

9 the lesser of the purchase price or the appraised 

10 value of the project, as each is reduced by the 

11 cost of prepaying any outstanding indebtedness 

12 on the project and transaction costs of the sale; 

13 or 

14 ‘‘(B) in the case of a refinancing without 

15 the transfer of the project, to the project owner 

16 or the project sponsor, in an amount equal to 

17 the difference between the appraised value of 

18 the project less the outstanding indebtedness 

19 and total acceptable development cost. 

20 For purposes of paragraphs (6)(B) and (7)(B), the term 

21 ‘‘acceptable development cost’’ shall include, as applicable, 

22 the cost of acquisition, rehabilitation, loan prepayment, 

23 initial reserve deposits, and transaction costs.’’. 


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1 SEC. 724. USE OF PROJECT RESIDUAL RECEIPTS. 

2 Paragraph (1) of section 811(d) of the American 

3 Homeownership and Economic Opportunity Act of 2000 

4 (12 U.S.C. 1701q note) is amended— 

5 (1) by striking ‘‘not more than 15 percent of’’; 

6 and 

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

8 following: ‘‘or other purposes approved by the Sec9 retary’’. 

10 SEC. 725. ADDITIONAL PROVISIONS. 

11 Section 811 of the American Homeownership and 

12 Economic Opportunity Act of 2000 (12 U.S.C. 1701q 

13 note) is amended by adding at the end the following new 

14 subsections: 

15 ‘‘(e) SENIOR PRESERVATION RENTAL ASSISTANCE

16 CONTRACTS.—Notwithstanding any other provision of 

17 law, in connection with a prepayment plan for a project 

18 approved under subsection (a) by the Secretary or as oth19 erwise approved by the Secretary to prevent displacement 

20 of elderly residents of the project in the case of refinancing 

21 or recapitalization and to further preservation and afford22 ability of such project, the Secretary shall provide project23 based rental assistance for the project under a senior pres24 ervation rental assistance contract, as follows: 


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1 ‘‘(1) Assistance under the contract shall be 

2 made available to the private nonprofit organization 

3 owner— 

4 ‘‘(A) for a term of at least 20 years, sub5 ject to annual appropriations; and 

6 ‘‘(B) under the same rules governing 

7 project-based rental assistance made available 

8 under section 8 of the Housing Act of 1937 or 

9 under the rules governing such other assistance 

10 as may be made available for the project. 

11 ‘‘(2) Any projects for which a senior preserva12 tion rental assistance contract is provided shall be 

13 subject to a use agreement to ensure continued 

14 project affordability having a term of the longer of 

15 (A) the term of the senior preservation rental assist16 ance contract, or (B) such term as is required by the 

17 new financing. 

18 ‘‘(f) SUBORDINATION OR ASSUMPTION OF EXISTING

19 DEBT.—In lieu of prepayment under this section of the 

20 indebtedness with respect to a project, the Secretary may 

21 approve— 

22 ‘‘(1) in connection with new financing for the 

23 project, the subordination of the loan for the project 

24 under section 202 of the Housing Act of 1959 (as 

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1 zalez National Affordable Housing Act) and the con2 tinued subordination of any other existing subordi3 nate debt previously approved by the Secretary to 

4 facilitate preservation of the project as affordable 

5 housing; or 

6 ‘‘(2) the assumption (which may include the 

7 subordination described in paragraph (1)) of the 

8 loan for the project under such section 202 in con9 nection with the transfer of the project with such a 

10 loan to a private nonprofit organization. 

11 ‘‘(g) FLEXIBLE SUBSIDY DEBT.—The Secretary 

12 shall waive the requirement that debt for a project pursu13 ant to the flexible subsidy program under section 201 of 

14 the Housing and Community Development Amendments 

15 of 1978 (12 U.S.C. 1715z–1a) be prepaid in connection 

16 with a prepayment, refinancing, or transfer under this sec17 tion of a project if such waiver is necessary for the finan18 cial feasibility of the transaction and is consistent with 

19 the long-term preservation of the project as affordable 

20 housing. 

21 ‘‘(h) TENANT INVOLVEMENT IN PREPAYMENT AND

22 REFINANCING.—The Secretary shall not accept an offer 

23 to prepay the loan for any project under section 202 of 

24 the Housing Act of 1959 unless the Secretary has— 


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1 ‘‘(1) determined that the owner of the project 

2 has notified the tenants of the owner’s request for 

3 approval of a prepayment; 

4 ‘‘(2) determined that the owner of the project 

5 has provided the tenants with an opportunity to 

6 comment on the owner’s request for approval of a 

7 prepayment, including a description of any antici8 pated rehabilitation or other use of the proceeds 

9 from the transaction, and its impacts on project 

10 rents, tenant contributions, or the affordability re11 strictions for the project; and 

12 ‘‘(3) taken such comments into consideration. 

13 ‘‘(i) DEFINITION OF PRIVATE NONPROFIT ORGANI14 ZATION.—For purposes of this section, the term ‘private 

15 nonprofit organization’ has the meaning given such term 

16 in section 202(k) of the Housing Act of 1959 (12 U.S.C. 

17 1701q(k)).’’. 

18 Subtitle C—Assisted Living 

19 Facilities 

20 SEC. 731. DEFINITION OF ASSISTED LIVING FACILITY. 

21 Section 202b(g) of the Housing Act of 1959 (12 

22 U.S.C. 1701q–2(g)) is amended by striking paragraph (1) 

23 and inserting the following new paragraph: 

24 ‘‘(1) the term ‘assisted living facility’ means a 

25 facility that— 


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1 ‘‘(A) is owned by a private nonprofit orga2 nization; and 

3 ‘‘(B)(i) is licensed and regulated by a 

4 State (or if there is no State law providing for 

5 such licensing and regulation by the State, by 

6 the municipality or other political subdivision in 

7 which the facility is located); or 

8 ‘‘(ii)(I) makes available, directly or 

9 through licensed or certified third party service 

10 providers, to residents at the resident’s request 

11 or choice supportive services to assist the resi12 dents in carrying out the activities of daily liv13 ing, as described in section 232(b)(6)(B) of the 

14 National Housing Act (12 U.S.C. 

15 1715w(b)(6)(B)); and 

16 ‘‘(II) provides separate dwelling units for 

17 residents, each of which may contain a full 

18 kitchen and bathroom and which includes com19 mon rooms and other facilities appropriate for 

20 the provision of supportive services to the resi21 dents of the facility; and’’. 

22 SEC. 732. MONTHLY ASSISTANCE PAYMENT UNDER RENTAL 

23 ASSISTANCE. 

24 Clause (iii) of section 8(o)(18)(B) of the United 

25 States Housing Act of 1937 (42 U.S.C. 


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1 1437f(o)(18)(B)(iii)) is amended by inserting before the 

2 period at the end the following: ‘‘, except that a family 

3 may be required at the time the family initially receives 

4 such assistance to pay rent in an amount exceeding 40 

5 percent of the monthly adjusted income of the family by 

6 such an amount or percentage that is reasonable given the 

7 services and amenities provided and as the Secretary 

8 deems appropriate.’’. 

9 Subtitle D—National Senior 

10 Housing Clearinghouse 

11 SEC. 741. NATIONAL SENIOR HOUSING CLEARINGHOUSE. 

12 (a) ESTABLISHMENT.—Not later than 12 months 

13 after the date of enactment of this Act, the Secretary of 

14 Housing and Urban Development (in this section referred 

15 to as the ‘‘Secretary’’) shall establish and operate a clear16 inghouse to serve as a national repository to receive, col17 lect, process, assemble, and disseminate information re18 garding the availability and quality of multifamily develop19 ments for elderly tenants, including— 

20 (1) the availability of— 

21 (A) supportive housing for the elderly pur22 suant to section 202 of the Housing Act of 

23 1959 (12 U.S.C. 1701q), including any housing 

24 unit assisted with a project rental assistance 

25 contract under such section; 


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1 (B) properties and units eligible for assist2 ance under section 8 of the United States 

3 Housing Act of 1937 (42 U.S.C. 1437f); 

4 (C) properties eligible for the low-income 

5 housing tax credit under section 42 of the In6 ternal Revenue Code of 1986; 

7 (D) units in assisted living facilities in8 sured pursuant to section 221(d)(4) of the Na9 tional Housing Act (12 U.S.C. 1715l(d)(4)); 

10 (E) units in any multifamily project that 

11 has been converted into an assisted living facil12 ity for elderly persons pursuant to section 202b 

13 of the Housing Act of 1959 (12 U.S.C. 1701q– 

14 2); and 

15 (F) any other federally assisted or sub16 sidized housing for the elderly; 

17 (2) the number of available units in each prop18 erty, project, or facility described in paragraph (1); 

19 (3) the number of bedrooms in each available 

20 unit in each property, project, or facility described in 

21 paragraph (1); 

22 (4) the estimated cost to a potential tenant to 

23 rent or reside in each available unit in each prop24 erty, project, or facility described in paragraph (1); 


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1 (5) the presence of a waiting list for entry into 

2 any available unit in each property, project, or facil3 ity described in paragraph (1); 

4 (6) the number of persons on the waiting list 

5 for entry into any available unit in each property, 

6 project, or facility described in paragraph (1); 

7 (7) the amenities available in each available 

8 unit in each property, project, or facility described in 

9 paragraph (1), including— 

10 (A) the services provided by such property, 

11 project, or facility; 

12 (B) the size and availability of common 

13 space within each property, project, or facility; 

14 (C) the availability of organized activities 

15 for individuals residing in such property, 

16 project, or facility; and 

17 (D) any other additional amenities avail18 able to individuals residing in such property, 

19 project, or facility; 

20 (8) the level of care (personal, physical, or nurs21 ing) available to individuals residing in any property, 

22 project, or facility described in paragraph (1); 

23 (9) whether there is a service coordinator in 

24 any property, project, or facility described in para25 graph (1); and 


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1 (10) any other criteria determined appropriate 

2 by the Secretary. 

3 (b) COLLECTION AND UPDATING OF INFORMA4 TION.— 

5 (1) INITIAL COLLECTION.—Not later than 180 

6 days after the date of enactment of this Act, the 

7 Secretary shall conduct an annual survey requesting 

8 information from each owner of a property, project, 

9 or facility described in subsection (a)(1) regarding 

10 the provisions described in paragraphs (2) through 

11 (11) of such subsection. 

12 (2) RESPONSE TIME.—Not later than 60 days 

13 after receiving the request described under para14 graph (1), the owner of each such property, project, 

15 or facility shall submit such information to the Sec16 retary. 

17 (3) PUBLIC AVAILABILITY.—Not later than 120 

18 days after the Secretary receives the submission of 

19 any information required under paragraph (2), the 

20 Secretary shall make such information publicly avail21 able through the clearinghouse. 

22 (4) UPDATES.—The Secretary shall conduct a 

23 biennial survey of each owner of a property, project, 

24 or facility described in subsection (a)(1) for the pur25 pose of updating or modifying information provided 


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1 in the initial collection of information under para2 graph (1). Not later than 30 days after receiving 

3 such a request, the owner of each such property, 

4 project, or facility shall submit such updates or 

5 modifications to the Secretary. Not later than 60 

6 days after receiving such updates or modifications, 

7 the Secretary shall inform the clearinghouse of such 

8 updated or modified information. 

9 (c) FUNCTIONS.—The clearinghouse established 

10 under subsection (a) shall— 

11 (1) respond to inquiries from State and local 

12 governments, other organizations, and individuals re13 questing information regarding the availability of 

14 housing in multifamily developments for elderly ten15 ants; 

16 (2) make such information publicly available via 

17 the Internet website of the Department of Housing 

18 and Urban Development, which shall include— 

19 (A) access via electronic mail; and 

20 (B) an easily searchable, sortable, 

21 downloadable, and accessible index that itemizes 

22 the availability of housing in multifamily devel23 opments for elderly tenants by State, county, 

24 and zip code; 


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1 (3) establish a toll-free number to provide the 

2 public with specific information regarding the avail3 ability of housing in multifamily developments for el4 derly tenants; and 

5 (4) perform any other duty that the Secretary 

6 determines necessary to achieve the purposes of this 

7 section. 

8 (d) RELATIONSHIP WITH OTHER DATABASES.—In 

9 carrying out this section, the Secretary may make the 

10 clearinghouse a part of any other multifamily housing 

11 database that the Secretary maintains or is otherwise re12 quired to establish pursuant to this Act or any other provi13 sion of law. 

14 (e) AUTHORIZATION OF APPROPRIATIONS.—There 

15 are authorized to be appropriated such sums as necessary 

16 to carry out this section. 

17 TITLE VIII—RURAL HOUSING 

18 PRESERVATION 

19 SEC. 801. SHORT TITLE. 

20 This title may be cited as the ‘‘Rural Housing Preser21 vation Act of 2010’’. 

22 SEC. 802. PRESERVATION OF MULTIFAMILY HOUSING. 

23 (a) PRESERVATION PROGRAM.—Title V of the Hous24 ing Act of 1949 (42 U.S.C. 1471 et seq.) is amended by 

25 adding at the end the following new section: 


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1 ‘‘SEC. 545. PRESERVATION OF MULTIFAMILY HOUSING AND 

2 PROTECTION OF TENANTS. 

3 ‘‘(a) PRESERVATION PROGRAM.—The Secretary 

4 shall, subject to the availability of amounts appropriated, 

5 carry out a preservation program in accordance with this 

6 section to provide financial incentives and other assistance 

7 to owners of eligible projects through long-term use agree8 ments entered into between the project owners and the 

9 Secretary. 

10 ‘‘(b) APPLICATIONS TO PARTICIPATE.— 

11 ‘‘(1) IN GENERAL.—The Secretary shall accept 

12 applications from owners of eligible projects to par13 ticipate in the preservation program under this sec14 tion. 

15 ‘‘(2) PRIORITY.—In selecting among applica16 tions of eligible projects to participate in the preser17 vation program, the Secretary may give priority to 

18 applications for such projects that are located on 

19 tribal trust lands or other Indian areas, in colonias 

20 (as such term is defined in section 916(e) of the 

21 Cranston-Gonzalez National Affordable Housing Act 

22 (42 U.S.C. 5306 note), or in other small, poor, low23 income communities. 

24 ‘‘(c) LONG-TERM VIABILITY PLAN.— 

25 ‘‘(1) REQUIREMENT.—The Secretary shall pre26 pare and approve a long-term viability plan under 


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1 this subsection with respect to each eligible project 

2 for which the owner requests to participate. 

3 ‘‘(2) CONTENTS.—Each long-term viability plan 

4 for an eligible project shall include the following in5 formation: 

6 ‘‘(A) PHYSICAL NEEDS ASSESSMENT.—A 

7 physical needs assessment of the project that 

8 identifies and projects, for the following 30 

9 years— 

10 ‘‘(i) all necessary repairs, improve11 ments, maintenance, and management 

12 standards for the project, and when they 

13 will be made, in order to meet the require14 ments of this title; and 

15 ‘‘(ii) the costs associated with the 

16 items referred to clause (i). 

17 ‘‘(B) FINANCIAL PLAN.—A financial plan 

18 for the project that— 

19 ‘‘(i) reviews the financial stability of 

20 the project; 

21 ‘‘(ii) includes the loan restructuring 

22 elements, rent adjustments, management 

23 and operational efficiencies, and other fi24 nancial adjustments to the project that are 

25 necessary to cover operating expenses for 


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1 the project and maintain an adequate fi2 nancial reserve for the future maintenance 

3 and capital needs of the project; 

4 ‘‘(iii) provides the project owner with 

5 a long-term rate of return on equity of the 

6 project owner, as determined by the Sec7 retary, commensurate to comparable rural 

8 multifamily housing projects for which a 

9 tax credit is provided under section 42 of 

10 the Internal Revenue Code of 1986 (26 

11 U.S.C. 42), and provides that any return 

12 in excess of such rate of return shall be 

13 made available to the Secretary only for 

14 use under section 514, 515, or 516; 

15 ‘‘(iv) meets the physical needs for the 

16 project determined under the physical 

17 needs assessment; 

18 ‘‘(v) ensures that rents available 

19 under the plan are affordable to eligible 

20 households in accordance with subsection 

21 (f); and 

22 ‘‘(vi) addresses any costs associated 

23 with any temporary tenant displacement 

24 resulting from renovations or rehabilitation 


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1 undertaken as a result of participation of 

2 the project in the preservation program. 

3 ‘‘(3) DEVELOPMENT THROUGH PARTICIPATING

4 ADMINISTRATIVE ENTITIES.—The Secretary may de5 velop long-term viability plans through the use of 

6 third-party participating administrative entities, who 

7 may be a private contractor, a State housing finance 

8 agency, or a nonprofit organization. 

9 ‘‘(4) PRESERVATION DETERMINATION.—Based 

10 on the long-term viability plan for an eligible project, 

11 the Secretary shall determine whether to offer the 

12 project owner a financial restructuring plan under 

13 subsection (d) and the financial incentives to be in14 cluded in any such plan offered. 

15 ‘‘(5) FINAL REVIEW AND COMMENT.—Before a 

16 determination is made under subparagraph (D) with 

17 respect to any long-term viability plan prepared by 

18 the Secretary, the Secretary shall— 

19 ‘‘(A) provide the project owner an oppor20 tunity to review the plan and discuss the plan 

21 with the Secretary or its agent; 

22 ‘‘(B) make available to the tenants of the 

23 project a copy of such plan and provide a period 

24 of not less than 30 days for tenants to submit 


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1 comments regarding the plan to the Secretary; 

2 and 

3 ‘‘(C) respond in writing to such comments. 

4 ‘‘(6) FEES.—The Secretary may charge the 

5 project owner a fee for preparation of the long-term 

6 viability plan. 

7 ‘‘(7) PAYMENT OF FEES.—If a long-term viabil8 ity for a project is approved, the payment of such 

9 fee may be incorporated into a project owner’s finan10 cial restructuring plan for the project provided by 

11 the Secretary pursuant to subsection (d). 

12 ‘‘(d) FINANCIAL RESTRUCTURING PLAN; PRESERVA13 TION INCENTIVES.—Based on the long-term viability plan 

14 for an eligible project, the Secretary may offer a project 

15 owner a financial restructuring plan for the project. Such 

16 a plan may include one or more of the following preserva17 tion incentives: 

18 ‘‘(1) Reduction or elimination of interest on the 

19 loan or loans for the project made under section 

20 514, 515, or 516. 

21 ‘‘(2) Partial or full deferral of payments due 

22 under such loan or loans. 

23 ‘‘(3) Forgiveness of such loan or loans. 


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1 ‘‘(4) Subordination of such loan or loans, sub2 ject to such terms and conditions as the Secretary 

3 shall determine. 

4 ‘‘(5) Reamortization of loan payments under 

5 such loan or loans over extended terms. 

6 ‘‘(6) A grant from the Secretary for the project. 

7 ‘‘(7) Payment of project costs associated with 

8 developing the long-term viability plan. 

9 ‘‘(8) Opportunity for project owners to obtain 

10 further investment equity from third parties. 

11 ‘‘(9) A direct loan or guarantee of a loan for 

12 the project, with a subsidized interest rate without 

13 regard to the value of the project. 

14 ‘‘(e) LONG-TERM USE AGREEMENT.— 

15 ‘‘(1) IN GENERAL.—If the owner of an eligible 

16 project agrees to the terms of a financial restruc17 turing plan for the project providing preservation 

18 benefits under subsection (d), in exchange for such 

19 benefits, the Secretary and the project owner shall 

20 enter into a long-term use agreement under this sub21 section for the project. 

22 ‘‘(2) AGREEMENT.—A long-term use agreement 

23 for an eligible project shall include— 


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1 ‘‘(A) the terms of the financial restruc2 turing plan for the project, including any pres3 ervation incentives to be provided; 

4 ‘‘(B) an agreement by the project owner— 

5 ‘‘(i) to continue the property use re6 strictions with respect to the project in ac7 cordance with this title for a period of— 

8 ‘‘(I) 30 years, or 

9 ‘‘(II) the remaining term of any 

10 loans under this title for the project, 

11 whichever ends later; 

12 ‘‘(ii) to comply with the long-term via13 bility plan for the project; and 

14 ‘‘(iii) to comply with the rent terms 

15 under subsection (f) for the project; 

16 ‘‘(C) provisions terminating the agreement 

17 if any material preservation incentives for the 

18 project to be provided under the agreement are 

19 no longer available and the Secretary deter20 mines that such unavailability is not the fault 

21 of the owner; 

22 ‘‘(D) any rent terms for the project pursu23 ant to subsection (f); 

24 ‘‘(E) a covenant which runs with the land; 


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1 ‘‘(F) a representation and warranty by the 

2 owner to provide safe, healthy, clean buildings 

3 pursuant to the Secretary’s guidelines; 

4 ‘‘(G) provisions providing for rural preser5 vation voucher assistance under section 542(c) 

6 for low-income households residing in the 

7 project who are eligible for such vouchers; and 

8 ‘‘(H) such other terms as the Secretary de9 termines are necessary to implement the pur10 poses of this section. 

11 ‘‘(f) RENTS UNDER LONG-TERM USE AGREE12 MENT.—Rents for any eligible households residing in 

13 dwelling units in any preserved project shall comply with 

14 the following requirements: 

15 ‘‘(1) MAXIMUM HOUSEHOLD CONTRIBUTION TO

16 RENT AND UTILITIES.—The maximum household 

17 contribution to monthly rent and utilities for any eli18 gible household may not exceed 30 percent of the 

19 adjusted income of the eligible household. 

20 ‘‘(2) RENT ADJUSTMENTS.—The rents for eligi21 ble projects may be increased or decreased only on 

22 an annual basis and only in accordance with stand23 ards incorporated in such agreement. 

24 ‘‘(3) LOWEST COST REQUIREMENT.—In deter25 mining the terms of a restructuring plan, and the 


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1 type and amount of preservation benefits under such 

2 plan to approve under this section for an eligible 

3 project, the Secretary shall, to the extent prac4 ticable, approve assistance that imposes the least 

5 cost to the Secretary while meeting the requirements 

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

7 ‘‘(g) EARNED INCOME DISREGARD FOR RESI8 DENTS.— 

9 ‘‘(1) IN GENERAL.—Notwithstanding any other 

10 provision of law, the amount of the contribution to11 ward rent for a dwelling unit payable, by any house12 hold described in paragraph (3), for occupancy in a 

13 project funded with a loan under section 514, 515, 

14 or 516 may not be increased as a result of the in15 creased income due to employment during the 12- 

16 month period beginning on the date on which the 

17 employment is commenced. 

18 ‘‘(2) PHASE-IN OF RENT INCREASES.—Upon 

19 the expiration of the 12-month period referred to in 

20 paragraph (1), the contribution toward rent payable 

21 by a household described in paragraph (3) may be 

22 increased due to the continued employment of the 

23 household member described in subparagraph 

24 (3)(B), except that during the 12-month period be25 ginning upon such expiration the amount of the inVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00196 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 crease may not be greater than 50 percent of the 

2 amount of the total increase in contribution toward 

3 rent that would be applicable but for this paragraph. 

4 ‘‘(3) ELIGIBLE HOUSEHOLD.—A household de5 scribed in this paragraph is a household that— 

6 ‘‘(A)(i) is an eligible household who resides 

7 in an eligible project; or 

8 ‘‘(ii) is provided rural preservation voucher 

9 assistance pursuant to section 542(c); and 

10 ‘‘(B)(i) whose income increases as a result 

11 of employment of a member of the household 

12 who was previously unemployed for 1 or more 

13 years; 

14 ‘‘(ii) whose earned income increases during 

15 the participation of a household member in any 

16 family self-sufficiency or other job training pro17 gram; or 

18 ‘‘(iii) who is or was, within 6 months, as19 sisted under any State program for temporary 

20 assistance for needy families funded under part 

21 A of title IV of the Social Security Act (42 

22 U.S.C. 601 et seq.) and whose earned income 

23 increases. 

24 ‘‘(h) INELIGIBILITY.— 


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1 ‘‘(1) PROCEDURE FOR DETERMINATION.—The 

2 Secretary may determine that a project owner is in3 eligible for participation in the preservation program 

4 under this section in accordance with the standards 

5 under paragraph (2). 

6 ‘‘(2) STANDARDS.—The Secretary may deter7 mine that a project owner is ineligible if— 

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

9 poor management or maintenance of multi10 family housing properties; 

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

12 loan made available under the section 514, 515, 

13 or 516 housing program; 

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

15 a long-term use agreement for the project that 

16 is the subject of the application with the project 

17 owner within a reasonable time; 

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

19 debarred from participating in Federal con20 tracts or programs; or 

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

22 for withholding from the project owner the ben23 efits made available under this section. 

24 ‘‘(i) DEFINITIONS.—For purposes of this section, the 

25 following definitions shall apply: 


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1 ‘‘(1) ELIGIBLE HOUSEHOLD.—The term ‘eligi2 ble household’ means a household that, under sec3 tion 514, 515, or 516, is eligible to reside in a 

4 project funded with a loan made by the Secretary 

5 under such section. 

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

7 project’ means a housing project funded with a loan 

8 made at any time by the Secretary under section 

9 514, 515, or 516, the principal obligation of which 

10 has not been fully repaid. 

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

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

13 eligible project, an individual or entity, or principals 

14 thereof that own, or plan to purchase, the project. 

15 ‘‘(4) PRESERVED PROJECT.—The term ‘pre16 served project’ means an eligible project for which 

17 the Secretary and owner have entered into agree18 ment on a financial restructuring plan for the 

19 project and into a long-term use agreement for the 

20 project, under this section. 

21 ‘‘(j) ANNUAL REPORT.—The Secretary shall submit 

22 a report to the Congress annually regarding the compli23 ance of owners of eligible projects participating in the 

24 preservation program under this section with the requireVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00199 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 ments of such program, which shall identify and describe 

2 any significant failures to comply. 

3 ‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There 

4 are authorized to be appropriated for each of fiscal years 

5 2011 through 2015 such sums as may be necessary to 

6 carry out the preservation program under this section.’’. 

7 SEC. 803. RURAL PRESERVATION AND RURAL TENANT PRO8 TECTION VOUCHERS. 

9 Section 542 of the Housing Act of 1949 (42 U.S.C. 

10 1490r) is amended by adding at the end the following new 

11 subsections: 

12 ‘‘(c) RURAL PRESERVATION ASSISTANCE.—In the 

13 case of a housing project subject to a loan made under 

14 section 514, 515, or 516 that is a preserved project (as 

15 such term is defined in section 545(i)), the Secretary shall, 

16 to the extent that amounts for assistance under this sub17 section are provided in advance in appropriation Acts, 

18 make available to each eligible household (as such term 

19 is defined in section 545(i)) that is not already assisted 

20 under the rental assistance program under section 521 or 

21 the program for rental assistance under section 8 of the 

22 United States Housing Act of 1937 (42 U.S.C. 1437f), 

23 and is residing in the project upon the date that a long24 term use agreement is entered into pursuant to section 

25 545(e) between the project owner and the Secretary, 


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1 voucher assistance under this subsection or rental assist2 ance under section 521 upon such date, as follows: 

3 ‘‘(1) The amount of assistance provided shall be 

4 sufficient to allow such household to remain in the 

5 project after it is preserved. 

6 ‘‘(2) The percentage of adjusted income paid by 

7 the eligible household for rent and utilities for the 

8 assisted dwelling shall not exceed 30 percent of ad9 justed income of the eligible household. 

10 ‘‘(3) The assistance shall be available to the eli11 gible household only during the period in which the 

12 eligible household resides in the preserved project 

13 and the long-term use agreement remains in effect. 

14 ‘‘(4) Upon termination of the participation of 

15 the eligible household in the assistance program, the 

16 assistance shall remain attached to the preserved 

17 project and shall be available for use by another eli18 gible household residing in the preserved project. 

19 ‘‘(d) RURAL TENANT PROTECTION VOUCHERS FOR

20 PREPAYMENTS AND FORECLOSURES.— 

21 ‘‘(1) IN GENERAL.—In the case of a housing 

22 project subject to a loan made under section 514, 

23 515, or 516 that is prepaid or foreclosed upon, the 

24 Secretary shall, to the extent that amounts for as25 sistance under this subsection are provided in adVerDate Nov 24 2008 00:12 Mar 19, 2010 Jkt 089200 PO 00000 Frm 00201 Fmt 6652 Sfmt 6201 E:\BILLS\H4868.IH H4868

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1 vance in appropriation Acts, make available to each 

2 eligible household (as such term is defined in section 

3 545(i)) that is not assisted under the rental assist4 ance program under section 521 or the program for 

5 rental assistance under section 8 of the United 

6 States Housing Act of 1937 (42 U.S.C. 1437f), and 

7 is residing in a dwelling unit in the project upon the 

8 date that the Secretary approves the prepayment or 

9 submits notice of foreclosure to the project owner, as 

10 applicable, voucher assistance upon such date, as fol11 lows: 

12 ‘‘(A) RELOCATION VOUCHERS.—In the 

13 case of any such eligible household who must 

14 relocate from a project for which the loan is 

15 being prepaid or foreclosed upon, voucher as16 sistance under this subsection shall be subject 

17 to the terms of section 8(o) of the United 

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

19 1437(o)), except that— 

20 ‘‘(i) the percentage of adjusted income 

21 paid by the eligible household for rent and 

22 utilities for the assisted dwelling unit shall 

23 not at any time exceed 30 percent of the 

24 adjusted income of the eligible household; 

25 and 


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1 ‘‘(ii) a voucher provided pursuant to 

2 this subparagraph shall be subject to the 

3 terms of section 8(r) of such Act (relating 

4 to portability), except that if an eligible 

5 household uses the voucher to move to a 

6 community other than the community in 

7 which the project from which the family re8 located pursuant to such prepayment or 

9 foreclosure is located, upon termination of 

10 the participation of such eligible family in 

11 the voucher program, the voucher shall be 

12 returned for use in the community in 

13 which such project is located. 

14 ‘‘(B) ENHANCED VOUCHERS.—In the case 

15 of any such eligible household who remains in 

16 a project for which the loan is prepaid or fore17 closed upon, voucher assistance under this sub18 section shall be subject to the terms of section 

19 8(t) of the United State Housing Act of 1937 

20 (42 U.S.C. 1437f(t)), except that— 

21 ‘‘(i) the percentage of adjusted income 

22 paid by the eligible household for rent and 

23 utilities for the assisted dwelling unit shall 

24 not at any time exceed 30 percent of the 

25 adjusted income of the eligible household; 


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1 ‘‘(ii) the owner of the project may not 

2 refuse to lease, to an eligible household for 

3 whom voucher assistance under this sub4 paragraph is made available, any available 

5 appropriately sized rental dwelling unit in 

6 the project; 

7 ‘‘(iii) voucher assistance under this 

8 subparagraph may be used only for dwell9 ing units in housing that is decent, safe, 

10 and sanitary; and 

11 ‘‘(iv) upon termination of participa12 tion of such eligible family in the enhanced 

13 voucher program, the voucher shall convert 

14 to a relocation voucher under subpara15 graph (A) of this paragraph, and shall be 

16 available with respect to such project only 

17 to provide assistance in accordance with 

18 the provisions of such subparagraph. 

19 ‘‘(e) ADMINISTRATION.—The Secretary may contract 

20 with a public housing agency or a private or nonprofit or21 ganization to administer vouchers authorized under sub22 sections (c) and (d). 

23 ‘‘(f) RENEWAL.—Vouchers under subsections (c) and 

24 (d) shall be renewed annually, subject to the availability 

25 of appropriations for such renewal. 


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1 ‘‘(g) USE OF SAVINGS.—Notwithstanding any other 

2 provision of law, any amounts made available for voucher 

3 assistance under subsections (c) and (d) that remain un4 used because of increases in the incomes of household as5 sisted under such vouchers shall be available to the Sec6 retary for eligible activities under this Act. 

7 ‘‘(h) APPLICABILITY OF SECTION 8 PROGRAM.—Ex8 cept as specifically provided otherwise in this section, to 

9 the maximum extent practicable, the Secretary shall ad10 minister voucher assistance under subsections (c) and (d) 

11 in accordance with, but not subject to, regulations and ad12 ministrative guidance for housing vouchers administered 

13 by the Secretary of Housing and Urban Development 

14 under section 8(o) of such Act. 

15 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There is 

16 authorized to be appropriated for voucher assistance under 

17 subsections (c) and (d) such sums as may be necessary 

18 for each of fiscal years 2011 through 2015.’’. 

19 SEC. 804. TENANT PARTICIPATION. 

20 Title V of the Housing Act of 1949 is amended by 

21 inserting after section 517 (42 U.S.C. 1487) the following 

22 new section: 

23 ‘‘SEC. 518. TENANT PARTICIPATION. 

24 ‘‘The Secretary shall extend to tenants in multifamily 

25 housing projects financed under sections 514, 515, 516 


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1 and 538 all of the rights that are specified in section 202 

2 of the Housing and Community Development Amend3 ments of 1978 (12 U.S.C. 1715z–1b) with respect to ten4 ants of multifamily housing projects (as such term is de5 fined in subsection (a) of such section).’’. 

6 SEC. 805. PRIORITY FOR FINANCING. 

7 Subsection (j) of section 515 of the Housing Act of 

8 1949 (42 U.S.C. 1485(j)) is amended— 

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

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

11 paragraph: 

12 ‘‘(2) The Secretary may give priority, in entering into 

13 contracts under this section involving financing for new 

14 construction of a project, for projects located in eligible 

15 rural areas having a need for affordable low-income rental 

16 housing due to prepayment of loans made or insured 

17 under this section.’’. 

18 SEC. 806. CONFORMING AMENDMENT. 

19 Section 537(b)(1) of the Housing Act of 1949 (42 

20 U.S.C. 1490p–1(b)(1)) is amended by inserting before the 

21 semicolon the following: ‘‘and to administer the preserva22 tion program under section 545’’. 

23 SEC. 807. REGULATIONS. 

24 The Secretary of Agriculture shall issue proposed 

25 regulations to carry out the amendments made by this title 


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1 not later than the expiration of the 90-day period begin2 ning upon the date of the enactment of this Act, and shall 

3 issue final regulations to carry out the amendments made 

4 by this title not later than the expiration of the 180-day 

5 period beginning upon such date of enactment. 

Æ 


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