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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 118 Enrolled Bill (ENR)]

        S.118

                      One Hundred Eleventh Congress

                                 of the

                        United States of America

                          AT THE SECOND SESSION

          Begun and held at the City of Washington on Tuesday,
             the fifth day of January, two thousand and ten

                                 An Act

 
To amend section 202 of the Housing Act of 1959, to improve the program 
under such section for supportive housing for the elderly, and for other 
                                purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
    (a) Short Title.--This Act may be cited as the ``Section 202 
Supportive Housing for the Elderly Act of 2010''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title and table of contents.

                    TITLE I--NEW CONSTRUCTION REFORMS

Sec. 101. Selection criteria.
Sec. 102. Development cost limitations.
Sec. 103. Owner deposits.
Sec. 104. Definition of private nonprofit organization.
Sec. 105. Nonmetropolitan allocation.

                          TITLE II--REFINANCING

Sec. 201. Approval of prepayment of debt.
Sec. 202. Use of unexpended amounts.
Sec. 203. Use of project residual receipts.
Sec. 204. Additional provisions.

   TITLE III--ASSISTED LIVING FACILITIES AND SERVICE-ENRICHED HOUSING

Sec. 301. Amendments to the grants for conversion of elderly housing to 
          assisted living facilities.
Sec. 302. Monthly assistance payment under rental assistance.

      TITLE IV--COMPLIANCE WITH STATUTORY PAY-AS-YOU-GO ACT OF 2010

Sec. 401. Budgetary effects.

                   TITLE I--NEW CONSTRUCTION REFORMS

    SEC. 101. SELECTION CRITERIA.
    Section 202(f)(1) of the Housing Act of 1959 (12 U.S.C. 
1701q(f)(1)) is amended--
        (1) by redesignating subparagraphs (F) and (G) as subparagraphs 
    (G) and (H), respectively; and
        (2) by inserting after subparagraph (E) the following new 
    subparagraph:
        ``(F) the extent to which the applicant has ensured that a 
    service coordinator will be employed or otherwise retained for the 
    housing, who has the managerial capacity and responsibility for 
    carrying out the actions described in subparagraphs (A) and (B) of 
    subsection (g)(2);''.
    SEC. 102. DEVELOPMENT COST LIMITATIONS.
    Section 202(h)(1) of the Housing Act of 1959 (12 U.S.C. 
1701q(h)(1)) is amended, in the matter preceding subparagraph (A), by 
inserting ``reasonable'' before ``development cost limitations''.
    SEC. 103. OWNER DEPOSITS.
    Section 202(j)(3)(A) of the Housing Act of 1959 (12 U.S.C. 
1701q(j)(3)(A)) is amended by inserting after the period at the end the 
following: ``Such amount shall be used only to cover operating deficits 
during the first 3 years of operations and shall not be used to cover 
construction shortfalls or inadequate initial project rental assistance 
amounts.''.
    SEC. 104. DEFINITION OF PRIVATE NONPROFIT ORGANIZATION.
    Section 202(k)(4) of the Housing Act of 1959 (12 U.S.C. 
1701q(k)(4)) is amended to read as follows:
        ``(4) The term `private nonprofit organization' means--
            ``(A) any incorporated private institution or foundation--
                ``(i) no part of the net earnings of which inures to 
            the benefit of any member, founder, contributor, or 
            individual;
                ``(ii) which has a governing board--

                    ``(I) the membership of which is selected in a 
                manner to assure that there is significant 
                representation of the views of the community in which 
                such housing is located; and
                    ``(II) which is responsible for the operation of 
                the housing assisted under this section, except that, 
                in the case of a nonprofit organization that is the 
                sponsoring organization of multiple housing projects 
                assisted under this section, the Secretary may 
                determine the criteria or conditions under which 
                financial, compliance and other administrative 
                responsibilities exercised by a single-entity private 
                nonprofit organization that is the owner corporation 
                responsible for the operation of an individual housing 
                project may be shared or transferred to the governing 
                board of such sponsoring organization; and

                ``(iii) which is approved by the Secretary as to 
            financial responsibility; and
            ``(B) a for-profit limited partnership the sole general 
        partner of which is--
                ``(i) an organization meeting the requirements under 
            subparagraph (A);
                ``(ii) a for-profit corporation wholly owned and 
            controlled by one or more organizations meeting the 
            requirements under subparagraph (A); or
                ``(iii) a limited liability company wholly owned and 
            controlled by one or more organizations meeting the 
            requirements under subparagraph (A).''.
    SEC. 105. NONMETROPOLITAN ALLOCATION.
    Paragraph (3) of section 202(l) of the Housing Act of 1959 (12 
U.S.C. 1701q(l)(3)) is amended by inserting after the period at the end 
the following: ``In complying with this paragraph, the Secretary shall 
either operate a national competition for the nonmetropolitan funds or 
make allocations to regional offices of the Department of Housing and 
Urban Development.''.

                         TITLE II--REFINANCING

    SEC. 201. APPROVAL OF PREPAYMENT OF DEBT.
    Subsection (a) of section 811 of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
        (1) in the matter preceding paragraph (1), by inserting ``, for 
    which the Secretary's consent to prepayment is required,'' after 
    ``Affordable Housing Act)'';
        (2) in paragraph (1)--
            (A) by inserting ``at least 20 years following'' before 
        ``the maturity date'';
            (B) by inserting ``project-based'' before ``rental 
        assistance payments contract'';
            (C) by inserting ``project-based'' before ``rental housing 
        assistance programs''; and
            (D) by inserting ``, or any successor project-based rental 
        assistance program,'' after ``1701s))'';
        (3) by amending paragraph (2) to read as follows:
        ``(2) the prepayment may involve refinancing of the loan if 
    such refinancing results in--
            ``(A) a lower interest rate on the principal of the loan 
        for the project and in reductions in debt service related to 
        such loan; or
            ``(B) a transaction in which the project owner will address 
        the physical needs of the project, but only if, as a result of 
        the refinancing--
                ``(i) the rent charges for unassisted families residing 
            in the project do not increase or such families are 
            provided rental assistance under a senior preservation 
            rental assistance contract for the project pursuant to 
            subsection (e); and
                ``(ii) the overall cost for providing rental assistance 
            under section 8 for the project (if any) is not increased, 
            except, upon approval by the Secretary to--

                    ``(I) mark-up-to-market contracts pursuant to 
                section 524(a)(3) of the Multifamily Assisted Housing 
                Reform and Affordability Act (42 U.S.C. 1437f note), as 
                such section is carried out by the Secretary for 
                properties owned by nonprofit organizations; or
                    ``(II) mark-up-to-budget contracts pursuant to 
                section 524(a)(4) of the Multifamily Assisted Housing 
                Reform and Affordability Act (42 U.S.C. 1437f note), as 
                such section is carried out by the Secretary for 
                properties owned by eligible owners (as such term is 
                defined in section 202(k) of the Housing Act of 1959 
                (12 U.S.C. 1701q(k)); and''; and

        (4) by adding at the end the following:
        ``(3) notwithstanding paragraph (2)(A), the prepayment and 
    refinancing authorized pursuant to paragraph (2)(B) involves an 
    increase in debt service only in the case of a refinancing of a 
    project assisted with a loan under such section 202 carrying an 
    interest rate of 6 percent or lower.''.
    SEC. 202. USE OF UNEXPENDED AMOUNTS.
    Subsection (c) of section 811 of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
        (1) by striking ``Use of Unexpended Amounts.--'' and inserting 
    ``Use of Proceeds.--'';
        (2) by amending the matter preceding paragraph (1) to read as 
    follows: ``Upon execution of the refinancing for a project pursuant 
    to this section, the Secretary shall ensure that proceeds are used 
    in a manner advantageous to tenants of the project, or are used in 
    the provision of affordable rental housing and related social 
    services for elderly persons that are tenants of the project or are 
    tenants of other HUD-assisted senior housing by the private 
    nonprofit organization project owner, private nonprofit 
    organization project sponsor, or private nonprofit organization 
    project developer, including--'';
        (3) by amending paragraph (1) to read as follows:
        ``(1) not more than 15 percent of the cost of increasing the 
    availability or provision of supportive services, which may include 
    the financing of service coordinators and congregate services, 
    except that upon the request of the non-profit owner, sponsor, or 
    organization and determination of the Secretary, such 15 percent 
    limitation may be waived to ensure that the use of unexpended 
    amounts better enables seniors to age in place;'';
        (4) in paragraph (2), by inserting before the semicolon the 
    following; ``, including reducing the number of units by 
    reconfiguring units that are functionally obsolete, unmarketable, 
    or not economically viable'';
        (5) in paragraph (3), by striking ``or'' at the end;
        (6) in paragraph (4), by striking ``according to a pro rata 
    allocation of shared savings resulting from the refinancing.'' and 
    inserting a semicolon; and
        (7) by adding at the end the following new paragraphs:
        ``(5) rehabilitation of the project to ensure long-term 
    viability; and
        ``(6) the payment to the project owner, sponsor, or third party 
    developer of a developer's fee in an amount not to exceed or 
    duplicate--
            ``(A) in the case of a project refinanced through a State 
        low income housing tax credit program, the fee permitted by the 
        low income housing tax credit program as calculated by the 
        State program as a percentage of acceptable development cost as 
        defined by that State program; or
            ``(B) in the case of a project refinanced through any other 
        source of refinancing, 15 percent of the acceptable development 
        cost.
For purposes of paragraph (6)(B), the term `acceptable development 
cost' shall include, as applicable, the cost of acquisition, 
rehabilitation, loan prepayment, initial reserve deposits, and 
transaction costs.''.
    SEC. 203. USE OF PROJECT RESIDUAL RECEIPTS.
    Paragraph (1) of section 811(d) of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
        (1) by striking ``not more than 15 percent of''; and
        (2) by inserting before the period at the end the following: 
    ``or other purposes approved by the Secretary''.
    SEC. 204. ADDITIONAL PROVISIONS.
    Section 811 of the American Homeownership and Economic Opportunity 
Act of 2000 (12 U.S.C. 1701q note) is amended by adding at the end the 
following new subsections:
    ``(e) Senior Preservation Rental Assistance Contracts.--
Notwithstanding any other provision of law, in connection with a 
prepayment plan for a project approved under subsection (a) by the 
Secretary or as otherwise approved by the Secretary to prevent 
displacement of elderly residents of the project in the case of 
refinancing or recapitalization and to further preservation and 
affordability of such project, the Secretary shall provide project-
based rental assistance for the project under a senior preservation 
rental assistance contract, as follows:
        ``(1) Assistance under the contract shall be made available to 
    the private nonprofit organization owner--
            ``(A) for a term of at least 20 years, subject to annual 
        appropriations; and
            ``(B) under the same rules governing project-based rental 
        assistance made available under section 8 of the Housing Act of 
        1937 or under the rules of such assistance as may be made 
        available for the project.
        ``(2) Any projects for which a senior preservation rental 
    assistance contract is provided shall be subject to a use agreement 
    to ensure continued project affordability having a term of the 
    longer of (A) the term of the senior preservation rental assistance 
    contract, or (B) such term as is required by the new financing.
    ``(f) Subordination or Assumption of Existing Debt.--In lieu of 
prepayment under this section of the indebtedness with respect to a 
project, the Secretary may approve--
        ``(1) in connection with new financing for the project, the 
    subordination of the loan for the project under section 202 of the 
    Housing Act of 1959 (as in effect before the enactment of the 
    Cranston-Gonzalez National Affordable Housing Act) and the 
    continued subordination of any other existing subordinate debt 
    previously approved by the Secretary to facilitate preservation of 
    the project as affordable housing; or
        ``(2) the assumption (which may include the subordination 
    described in paragraph (1)) of the loan for the project under such 
    section 202 in connection with the transfer of the project with 
    such a loan to a private nonprofit organization.
    ``(g) Flexible Subsidy Debt.--The Secretary shall waive the 
requirement that debt for a project pursuant to the flexible subsidy 
program under section 201 of the Housing and Community Development 
Amendments of 1978 (12 U.S.C. 1715z-1a) be prepaid in connection with a 
prepayment, refinancing, or transfer under this section of a project if 
the financial transaction or refinancing cannot be completed without 
the waiver.
    ``(h) Tenant Involvement in Prepayment and Refinancing.--The 
Secretary shall not accept an offer to prepay the loan for any project 
under section 202 of the Housing Act of 1959 unless the Secretary--
        ``(1) has determined that the owner of the project has notified 
    the tenants of the owner's request for approval of a prepayment; 
    and
        ``(2) has determined that the owner of the project has provided 
    the tenants with an opportunity to comment on the owner's request 
    for approval of a prepayment, including on the description of any 
    anticipated rehabilitation or other use of the proceeds from the 
    transaction, and its impacts on project rents, tenant 
    contributions, or the affordability restrictions for the project, 
    and that the owner has responded to such comments in writing.
    ``(i) Definition of Private Nonprofit Organization.--For purposes 
of this section, the term `private nonprofit organization' has the 
meaning given such term in section 202(k) of the Housing Act of 1959 
(12 U.S.C. 1701q(k)).''.

   TITLE III--ASSISTED LIVING FACILITIES AND SERVICE-ENRICHED HOUSING

    SEC. 301. AMENDMENTS TO THE GRANTS FOR CONVERSION OF ELDERLY 
      HOUSING TO ASSISTED LIVING FACILITIES.
    (a) Technical Amendment.--The section heading for section 202b of 
the Housing Act of 1959 (12 U.S.C. 1701q-2) is amended by inserting 
``and other purposes'' after ``assisted living facilities''.
    (b) Extension of Grant Authority.--Section 202b(a)(2) of the 
Housing Act of 1959 (12 U.S.C. 1701q-2(a)(2)) is amended--
        (1) by striking ``(2) Conversion.--Activities'' and inserting 
    the following:
        ``(2) Conversion.--
            ``(A) Assisted living facilities.--Activities''; and
        (2) by adding at the end the following:
            ``(B) Service-enriched housing.--Activities designed to 
        convert dwelling units in the eligible project to service-
        enriched housing for elderly persons.''.
    (c) Amendment to Application Process.--Section 202b(c)(1) of the 
Housing Act of 1959 (12 U.S.C. 1701q-2(c)(1)) is amended by inserting 
``for either an assisted living facility or service-enriched housing'' 
after ``activities''.
    (d) Requirements for Services.--Section 202b(d) of the Housing Act 
of 1959 (12 U.S.C. 1701q-2(d)) is amended to read as follows:
    ``(d) Requirements for Services.--
        ``(1) Sufficient evidence of firm funding commitments.--The 
    Secretary may not make a grant under this section for conversion 
    activities unless an application for a grant submitted pursuant to 
    subsection (c) contains sufficient evidence, in the determination 
    of the Secretary, of firm commitments for the funding of services 
    to be provided in the assisted living facility or service-enriched 
    housing, which may be provided by third parties.
        ``(2) Required evidence.--The Secretary shall require evidence 
    that each recipient of a grant for service-enriched housing under 
    this section provides relevant and timely disclosure of information 
    to residents or potential residents of such housing relating to--
            ``(A) the services that will be available at the property 
        to each resident, including--
                ``(i) the right to accept, decline, or choose such 
            services and to have the choice of provider;
                ``(ii) the services made available by or contracted 
            through the grantee;
                ``(iii) the identity of, and relevant information for, 
            all agencies or organizations providing any services to 
            residents, which agencies or organizations shall provide 
            information regarding all procedures and requirements to 
            obtain services, any charges or rates for the services, and 
            the rights and responsibilities of the residents related to 
            those services;
            ``(B) the availability, identity, contact information, and 
        role of the service coordinator; and
            ``(C) such other information as the Secretary determines to 
        be appropriate to ensure that residents are adequately informed 
        of the services options available to promote resident 
        independence and quality of life.''.
    (e) Amendments to Selection Criteria.--Section 202b(e) of the 
Housing Act of 1959 (12 U.S.C. 1701q-2(e)) is amended--
        (1) in paragraph (2)--
            (A) by inserting ``or service-enriched housing'' after 
        ``facilities''; and
            (B) by inserting ``service-enriched housing'' after 
        ``facility'';
        (2) in paragraph (5), by inserting ``or service-enriched 
    housing'' after ``facility''; and
        (3) in paragraph (6), by inserting ``or service-enriched 
    housing'' after ``facility''.
    (f) Amendments to Section 8 Project-based Assistance.--Section 
202b(f) of the Housing Act of 1959 (12 U.S.C. 1701q-2(f)) is amended--
        (1) in paragraph (1), by inserting ``or service-enriched 
    housing'' after ``facilities'' each time that term appears; and
        (2) in paragraph (2), by inserting ``or service-enriched 
    housing'' after ``facility''.
    (g) Amendments to Definitions.--Section 202b(g) of the Housing Act 
of 1959 (12 U.S.C. 1701q-2(g)) is amended to read as follows:
    ``(g) Definitions.--For purposes of this section--
        ``(1) the term `assisted living facility' has the meaning given 
    such term in section 232(b) of the National Housing Act (1715w(b));
        ``(2) the term `service-enriched housing' means housing that--
            ``(A) makes available through licensed or certified third 
        party service providers supportive services to assist the 
        residents in carrying out activities of daily living, such as 
        bathing, dressing, eating, getting in and out of bed or chairs, 
        walking, going outdoors, using the toilet, laundry, home 
        management, preparing meals, shopping for personal items, 
        obtaining and taking medication, managing money, using the 
        telephone, or performing light or heavy housework, and which 
        may make available to residents home health care services, such 
        as nursing and therapy;
            ``(B) includes the position of service coordinator, which 
        may be funded as an operating expense of the property;
            ``(C) provides separate dwelling units for residents, each 
        of which contains a full kitchen and bathroom and which 
        includes common rooms and other facilities appropriate for the 
        provision of supportive services to the residents of the 
        housing; and
            ``(D) provides residents with control over health care and 
        supportive services decisions, including the right to accept, 
        decline, or choose such services, and to have the choice of 
        provider; and
        ``(3) the definitions in section 1701(q)(k) of this title shall 
    apply.''.
    SEC. 302. MONTHLY ASSISTANCE PAYMENT UNDER RENTAL ASSISTANCE.
    Clause (iii) of section 8(o)(18)(B) of the United States Housing 
Act of 1937 (42 U.S.C. 1437f(o)(18)(B)(iii)) is amended by inserting 
before the period at the end the following: ``, except that a family 
may be required at the time the family initially receives such 
assistance to pay rent in an amount exceeding 40 percent of the monthly 
adjusted income of the family by such an amount or percentage that is 
reasonable given the services and amenities provided and as the 
Secretary deems appropriate.''.

     TITLE IV--COMPLIANCE WITH STATUTORY PAY-AS-YOU-GO ACT OF 2010

    SEC. 401. BUDGETARY EFFECTS.
    The budgetary effects of this Act, for the purpose of complying 
with the Statutory Pay-As-You-Go-Act of 2010, shall be determined by 
reference to the latest statement titled ``Budgetary Effects of PAYGO 
Legislation'' for this Act, submitted for printing in the Congressional 
Record by the Chairman of the Senate Budget Committee, provided that 
such statement has been submitted prior to the vote on passage.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.
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