I 

108TH CONGRESS 

1ST SESSION H. R. 445

To authorize the Secretary of Housing and Urban Development to make 

grants to States to supplement State assistance for the preservation 

of affordable housing for low-income families. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 29, 2003

Mr. NADLER (for himself, Mr. BERMAN, Ms. CORRINE BROWN of Florida, Mr. 

BROWN of Ohio, Mr. DAVIS of Florida, Ms. DELAURO, Mr. FARR, Mr. 

FRANK of Massachusetts, Mr. HONDA, Mrs. JONES of Ohio, Mr. KENNEDY of Rhode Island, Mr. LANTOS, Ms. LOFGREN, Mr. LYNCH, Ms. 

MCCOLLUM, Mr. MCDERMOTT, Mrs. MALONEY, Ms. MILLENDERMCDONALD, Ms. NORTON, Mr. OLVER, Mr. OWENS, Mr. RANGEL, Mr. 

RODRIGUEZ, Mr. SABO, Mr. SANDERS, Ms. SCHAKOWSKY, Mr. STARK, 

Mr. TIERNEY, Mr. WEINER, and Ms. WOOLSEY) introduced the following 

bill; which was referred to the Committee on Financial Services 

A BILL

To authorize the Secretary of Housing and Urban Development to make grants to States to supplement State 

assistance for the preservation of affordable housing for 

low-income families.

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Housing Preservation 

5 Matching Grant Act of 2003’’. 
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1 SEC. 2. FINDINGS AND PURPOSES. 

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

3 (1) more than 55,300 affordable housing dwell4 ing units in the United States have been lost 

5 through termination of low income affordability re6 quirements, which usually involves the prepayment 

7 of the outstanding principal balance under the mort8 gage on the project in which such units are located; 

9 (2) more than 265,000 affordable housing 

10 dwelling units in the United States are currently at 

11 risk of prepayment; 

12 (3) the loss of the privately owned, federally as13 sisted affordable housing, which is occurring during 

14 a period when rents for unassisted housing are in15 creasing and few units of additional affordable hous16 ing are being developed, will cause unacceptable 

17 harm on current tenants of affordable housing and 

18 will precipitate a national crisis in the supply of 

19 housing for low-income households; 

20 (4) the demand for affordable housing far ex21 ceeds the supply of such housing, as evidenced by 

22 studies in 1998 that found that—

23 (A) 5,300,000 households (one-seventh of 

24 all renters in the Nation) have worst-case hous25 ing needs; and 
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1 (B) the number of families with at least 

2 one full-time worker and having worst-case 

3 housing needs increased from 1991 to 1995 by 

4 265,000 (24 percent) to almost 1,400,000; 

5 (5) the shortage of affordable housing in the 

6 United States reached a record high in 1995, when 

7 the number of low-income households exceeded the 

8 number of low-cost rental dwelling units by 

9 4,400,000; 

10 (6) between 1990 and 1995, the shortage of af11 fordable housing in the United States increased by 

12 1,000,000 dwelling units, as the supply of low-cost 

13 units decreased by 100,000 and the number of low14 income renter households increased by 900,000; 

15 (7) there are nearly 2 low-income renters in the 

16 United States for every low-cost rental dwelling unit; 

17 (8) 2 of every 3 low-income renters receive no 

18 housing assistance and about 2,000,000 low-income 

19 households remain on waiting lists for affordable 

20 housing; 

21 (9) the shortage of affordable housing dwelling 

22 units results in low-income households that are not 

23 able to acquire low-cost rental units paying large 

24 proportions of their incomes for rent; and 
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1 (10) in 1995, 82 percent of low-income renter 

2 households were paying more than 30 percent of 

3 their incomes for rent and utilities. 

4 (b) PURPOSE.—It is the purpose of this Act—

5 (1) to promote the preservation of affordable 

6 housing units by providing matching grants to 

7 States that have developed and funded programs for 

8 the preservation of privately owned housing that is 

9 affordable to low-income families and persons and 

10 was produced for such purpose with Federal assist11 ance; 

12 (2) to minimize the involuntary displacement of 

13 tenants who are currently residing in such housing, 

14 many of whom are elderly or disabled persons; and 

15 (3) to continue the partnerships among the 

16 Federal Government, State and local governments, 

17 and the private sector in operating and assisting 

18 housing that is affordable to low-income Americans. 

19 SEC. 3. AUTHORITY. 

20 The Secretary of Housing and Urban Development 

21 shall, to the extent amounts are made available pursuant 

22 to section 11, make grants under this Act to States for 

23 low-income housing preservation. 
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1 SEC. 4. USE OF GRANTS. 

2 (a) IN GENERAL.—Amounts from grants under this 

3 Act may be used only for assistance for acquisition, pres4 ervation incentives, operating costs, and capital expendi5 tures for a housing project that meets the requirements 

6 under subsection (b), (c), or (d). 

7 (b) PROJECTS WITH HUD-INSURED MORTGAGES.—

8 A project meets the requirements under this subsection 

9 only if—

10 (1) the project is financed by a loan or mort11 gage that is—

12 (A) insured or held by the Secretary under 

13 section 221(d)(3) of the National Housing Act 

14 and receiving loan management assistance 

15 under section 8 of the United States Housing 

16 Act of 1937 due to a conversion from section 

17 101 of the Housing and Urban Development 

18 Act of 1965; 

19 (B) insured or held by the Secretary and 

20 bears interest at a rate determined under the 

21 proviso of section 221(d)(5) of the National 

22 Housing Act; 

23 (C) insured, assisted, or held by the Sec24 retary or a State or State agency under section 

25 236 of the National Housing Act; or 
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1 (D) held by the Secretary and formerly in2 sured under a program referred to in subpara3 graph (A), (B), or (C); 

4 (2) the project is subject to an unconditional 

5 waiver of, with respect to the mortgage referred to 

6 in paragraph (1)—

7 (A) all rights to any prepayment of the 

8 mortgage; and 

9 (B) all rights to any voluntary termination 

10 of the mortgage insurance contract for the 

11 mortgage; and 

12 (3) the owner of the project has entered into 

13 binding commitments (applicable to any subsequent 

14 owner) to extend all low-income affordability restric15 tions for the project, including any such restrictions 

16 imposed because of any contract for project-based 

17 assistance for the project. 

18 (c) PROJECTS WITH SECTION 8 PROJECT-BASED AS19 SISTANCE.—A project meets the requirements under this 

20 subsection only if—

21 (1) the project is subject to a contract for 

22 project-based assistance; and 

23 (2) the owner of the project has entered into 

24 binding commitments (applicable to any subsequent 

25 owner) to extend such assistance for the maximum 
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1 period allowable under law (subject to the avail2 ability of amounts for such purpose) and to extend 

3 any low-income affordability restrictions applicable 

4 to the project in connection with such assistance. 

5 (d) PROJECTS PURCHASED BY RESIDENTS.—A 

6 project meets the requirements under this subsection only 

7 if the project—

8 (1) is or was eligible low-income housing (as 

9 such term is defined in section 229 of the Low-In10 come Housing Preservation and Resident Home11 ownership Act of 1990 (42 U.S.C. 4119); and 

12 (2) has been purchased by a resident council for 

13 the housing or is approved by the Secretary for such 

14 purchase, for conversion to homeownership housing 

15 under a resident homeownership program meeting 

16 the requirements under section 226 of such Act (12 

17 U.S.C. 4116). 

18 (e) COMBINATION OF ASSISTANCE.—Notwith19 standing subsection (a), any project that is otherwise eligi20 ble for assistance with grant amounts provided under this 

21 Act because the project meets the requirements under sub22 section (b) or (c) and that also meets the requirements 

23 under paragraph (1) of the other of such subsections, shall 

24 be eligible for such assistance only if the project complies 

25 with all of the requirements under such other subsection. 
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1 SEC. 5. GRANT AMOUNT LIMITATION. 

2 The Secretary shall limit the portion of the aggregate 

3 amount of grants under this Act made available for any 

4 fiscal year that may be provided to a single State based 

5 upon the proportion of such State’s need (as determined 

6 by the Secretary) for such assistance to the aggregate 

7 need among all States approved for such assistance for 

8 such fiscal year. 

9 SEC. 6. MATCHING REQUIREMENT. 

10 (a) IN GENERAL.—The Secretary may not make a 

11 grant under this Act to any State for any fiscal year in 

12 an amount that exceeds twice the amount that the State 

13 certifies, as the Secretary shall require, that the State will 

14 contribute for such fiscal year, or has contributed since 

15 January 1, 2003, from non-Federal sources for the pur16 poses under section 4(a). 

17 (b) TREATMENT OF PREVIOUS CONTRIBUTIONS.—

18 Any portion of amounts contributed after January 1, 

19 2003, that are counted for purposes of meeting the re20 quirement under subsection (a) for a fiscal year may not 

21 be counted for such purposes for any subsequent fiscal 

22 year. 

23 (c) TREATMENT OF TAX CREDITS.—Tax credits pro24 vided under section 42 of the internal revenue code of 

25 1986 and proceeds from the sale of tax-exempt bonds by 
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1 any State or local government entity shall not be consid2 ered non-Federal sources for purposes of this section 

3 SEC. 7. TREATMENT OF SUBSIDY LAYERING REQUIRE4 MENTS. 

5 Neither section 6 nor any other provision of this Act 

6 may be construed to prevent the use of tax credits pro7 vided under section 42 of the Internal Revenue Code of 

8 1986 in connection with housing assisted with grant 

9 amounts provided under this Act, to the extent that such 

10 use is in accordance with section 102(d) of the Depart11 ment of Housing and Urban Development Reform Act of 

12 1989 (42 U.S.C. 3545(d)) and section 911 of the Housing 

13 and Community Development Act of 1992 (42 U.S.C. 

14 3545 note). 

15 SEC. 8. APPLICATIONS. 

16 The Secretary shall provide for States (through ap17 propriate State agencies) to submit applications for grants 

18 under this Act. The Secretary shall require the applica19 tions to contain any information and certifications nec20 essary for the Secretary to determine whether the State 

21 is eligible to receive such a grant. 

22 SEC. 9. DEFINITIONS. 

23 For purposes of this Act, the following definitions 

24 shall apply: 
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1 (1) LOW-INCOME AFFORDABILITY RESTRIC2 TIONS.—The term ‘‘low-income affordability restric3 tions’’ means, with respect to a housing project, any 

4 limitations imposed by regulation or regulatory 

5 agreement on rents for tenants of the project, rent 

6 contributions for tenants of the project, or income7 eligibility for occupancy in the project. 

8 (2) PROJECT-BASED ASSISTANCE.—The term 

9 ‘‘project-based assistance’’ has the meaning given 

10 such term in section 16(c) of the United States 

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

12 that such term includes assistance under any suc13 cessor programs to the programs referred to in such 

14 section. 

15 (3) SECRETARY.—The term ‘‘Secretary’’ means 

16 the Secretary of Housing and Urban Development. 

17 (4) STATE.—The term ‘‘State’’ means the 

18 States of the United States, the District of Colum19 bia, the Commonwealth of Puerto Rico, the Com20 monwealth of the Northern Mariana Islands, Guam, 

21 the Virgin Islands, American Samoa, and any other 

22 territory or possession of the United States. 

23 SEC. 10. REGULATIONS. 

24 The Secretary may issue any regulations necessary 

25 to carry out this Act. 
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1 SEC. 11. AUTHORIZATION OF APPROPRIATIONS. 

2 There is authorized to be appropriated for grants 

3 under this title such sums as necessary for each of fiscal 

4 years 2003, 2004, 2005, 2006, and 2007.

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