II 

111TH CONGRESS 

1ST SESSION S. 2897 

To establish incentives to increase the energy efficiency of federally assisted 

housing. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 17, 2009 

Mr. BENNET introduced the following bill; which was read twice and referred 

to the Committee on Banking, Housing, and Urban Affairs 

A BILL 

To establish incentives to increase the energy efficiency of 

federally assisted housing. 

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 ‘‘Energy Efficiency 

5 Modernization Act of 2009’’. 

6 SEC. 2. CONGRESSIONAL FINDINGS. 

7 Congress finds that— 

8 (1) Federally assisted housing programs provide 

9 robust opportunities for energy efficiency improve10 ments and up-front investments in such improveVerDate Nov 24 2008 03:40 Dec 22, 2009 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2897.IS S2897

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1 ments would provide significant long-term cost sav2 ings for taxpayers, provide stimulus to the economy 

3 through creation of capital projects and jobs, estab4 lish best practices for the industry and be consistent 

5 with the mandate of the Department of Housing and 

6 Urban Development (HUD); 

7 (2) the Government Accountability Office re8 ported in an October 2008 study that HUD pays an 

9 estimated $5 billion annually for energy costs for ap10 proximately 6 million dwelling units of assisted hous11 ing, representing almost 17 percent of the Nation’s 

12 housing stock; 

13 (3) according to the Harvard University Grad14 uate School of Design, more than 80 percent of fed15 erally assisted housing stock is between 15 years to 

16 30 years old; 

17 (4) existing rules and regulations do not ade18 quately incentivize owners of HUD-assisted property 

19 to maximize efforts to make energy efficiency im20 provements to such properties; and 

21 (5) increasing the energy efficiency of federally22 assisted housing by 25 percent to 40 percent would 

23 create near-term savings for HUD of roughly $1 bil24 lion to $1.5 billion annually, resulting in substantial 


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1 long-term cost savings for the Federal Government 

2 and for taxpayers. 

3 SEC. 3. GREEN DIVIDEND PROGRAM FOR FEDERALLY AS4 SISTED RENTAL HOUSING. 

5 (a) AUTHORITY.—The Secretary shall establish a 

6 program under this section to provide green dividends to 

7 owners of covered federally assisted housing projects who 

8 undertake utility cost-saving measures that result in util9 ity cost savings for such housing. 

10 (b) GREEN DIVIDENDS.— 

11 (1) IN GENERAL.—A green dividend under this 

12 section with respect to a covered federally assisted 

13 housing project shall be an annual distribution, to 

14 the owner of the project, of an amount of the sur15 plus project funds that is equal to the sum of— 

16 (A) 50 percent of the annual utility cost 

17 savings resulting from the utility cost-saving 

18 measures conducted for the project; and 

19 (B) any reasonable costs, as determined by 

20 the Secretary pursuant to subsection (d)(4), in21 curred by the owner in carrying out the utility 

22 cost-saving measures, including financing costs 

23 incurred by the owner or a third party, in com24 pliance with guidelines established pursuant to 

25 subsection (d)(3). 


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1 (2) ADDITIONAL TO STANDARD DISTRIBU2 TION.—Notwithstanding any other law or regulation 

3 relating to a limitation on distributions for a covered 

4 federally assisted housing project, a green dividend 

5 under this section shall be in addition to the stand6 ard distribution that the owner of the project is au7 thorized to receive from the project pursuant to the 

8 regulations of the Secretary. 

9 (c) STANDARDS FOR MEASUREMENT AND MONI10 TORING.—In carrying out the program under this section, 

11 the Secretary shall establish and utilize the following 

12 standardized methods: 

13 (1) Methods that an owner of a covered feder14 ally assisted housing project may use to accurately 

15 measure the baseline utility use of the project before 

16 undertaking the utility cost-saving measures for the 

17 project. 

18 (2) Methods that an owner of a covered feder19 ally assisted housing project may use to effectively 

20 monitor reductions in the utility use of the project 

21 resulting from the completed utility cost-saving 

22 measures for the project. 

23 (3) Methods that an owner of a covered feder24 ally assisted housing project may use to track, and 

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1 ings resulting from the utility cost-saving measures 

2 for the project that account for the effect of changes 

3 in utility costs and such other factors that the Sec4 retary considers necessary or appropriate. 

5 (d) OTHER REQUIREMENTS.— 

6 (1) APPLICATION AND SELECTION.—The Sec7 retary shall establish requirements for owners of 

8 covered federally assisted housing projects to apply 

9 for participation in the program under this section 

10 and shall select among such applications based upon 

11 selection criteria, which the Secretary shall establish. 

12 (2) COST-EFFECTIVENESS.—The Secretary 

13 shall establish guidelines to ensure that any utility 

14 cost-saving measures undertaken pursuant to the 

15 program under this section are cost-effective in rela16 tion to the utility cost savings resulting from the 

17 measures and the green dividend provided under this 

18 section to the owner. 

19 (3) ENERGY PERFORMANCE CONTRACTS.—The 

20 Secretary shall establish guidelines for the use of en21 ergy performance contracting in carrying out utility 

22 cost-saving measures pursuant to the program under 

23 this section. 

24 (4) FINANCING COSTS.—The Secretary shall es25 tablish guidelines for the financing of the reasonable 


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1 costs incurred by an owner of a covered federally as2 sisted housing project in carrying out utility cost3 saving measures under the program under this sec4 tion, and whether such costs, whether financed by 

5 the limited dividend owner or a third party, shall be 

6 repayable from project funds. 

7 (5) REPORTING.— 

8 (A) TO SECRETARY.—The Secretary shall 

9 require each owner of a covered federally as10 sisted housing project for which a green divi11 dend is provided pursuant to the program 

12 under this section to submit to the Secretary 

13 such reports regarding the project, the utility 

14 cost-saving measures undertaken for the 

15 project, and the utility cost savings of the 

16 project in accordance with such requirements as 

17 the Secretary shall establish. 

18 (B) TO CONGRESS.—The Secretary shall 

19 submit a reports to the Congress describing the 

20 implementation and operation of the program 

21 under this section, as follows: 

22 (i) INITIAL REPORT.—The Secretary 

23 shall submit a report describing the initial 

24 implementation and operation of the pro25 gram not later than the expiration of the 


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1 180-day period beginning upon the date of 

2 the enactment of this Act. 

3 (ii) ANNUAL REPORTS.—Not later 

4 than the expiration of the 12-month period 

5 that begins upon the expiration of the pe6 riod specified clause (i), and upon the expi7 ration of each successive 12-month period 

8 thereafter, the Secretary shall submit a re9 port describing the ongoing operation of 

10 the program. 

11 (e) PREEMPTION OF CONFLICTING STATE LAWS

12 LIMITING DISTRIBUTIONS.— 

13 (1) IN GENERAL.—Except as provided in para14 graph (2), no State or political subdivision of a 

15 State may establish, continue in effect, or enforce 

16 any law, regulation, or administrative requirement 

17 that limits or restricts, to an amount that is less 

18 than the sum of the amounts provided for under 

19 paragraphs (1) and (2) of subsection (b), the 

20 amount of surplus project funds accruing after the 

21 date of the enactment of this section that may be 

22 distributed from any covered federally assisted hous23 ing project. 


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1 (2) EXCEPTION AND WAIVER.—Paragraph (1) 

2 shall not apply to any law or regulation to the extent 

3 such law or regulation applies to— 

4 (A) a State-financed covered federally as5 sisted housing project; or 

6 (B) a covered federally assisted housing 

7 project for which the owner has elected to waive 

8 the applicability of paragraph (1). 

9 (f) DEFINITIONS.—For purposes of this section, the 

10 following definitions shall apply: 

11 (1) COVERED FEDERALLY ASSISTED HOUSING

12 PROJECT.—The term ‘‘covered federally assisted 

13 housing project’’ means any multifamily rental hous14 ing project that— 

15 (A) is provided any rental assistance, 

16 mortgage insurance, subsidy, or other financial 

17 assistance by the Secretary; and 

18 (B) that is subject to a limitation on dis19 tributions, to the owner, of project funds under 

20 section 200.106(a), 236.1(c), 880.205(b), 

21 881.205(b), or 883.306(b) of title 24 of the 

22 Code of Federal Regulations, or any other stat23 ute or regulation applicable to the project. 

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

25 the Secretary of Housing and Urban Development. 


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1 (3) SURPLUS PROJECT FUNDS.—The term 

2 ‘‘surplus project funds’’ means, with respect to a 

3 covered federally assisted housing project, the net 

4 revenue of the project after all project expenses have 

5 been paid, or funds have been set aside for the pay6 ment thereof, and any reserve requirements applica7 ble to the project have been met. 

8 (4) UTILITY COST SAVINGS.—The term ‘‘utility 

9 cost savings’’ means, with respect to utility cost-sav10 ing measures undertaken for a covered federally as11 sisted housing project, the difference between— 

12 (A) the energy or water costs that would 

13 have been incurred for the project if such utility 

14 cost-saving measures were not completed; and 

15 (B) the actual energy or water costs for 

16 the project after completion of the utility cost17 saving measures. 

18 (5) UTILITY COST-SAVING MEASURES.—The 

19 term ‘‘utility cost-saving measures’’ means, with re20 spect to a covered federally assisted housing project, 

21 any rehabilitation, renovation, retrofit, improvement, 

22 or alteration for the project that incorporates any 

23 technology, equipment, fixture, or material, or pro24 motes any practice, designed to reduce the energy or 

25 water consumption of the project. 


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1 (g) REGULATIONS.—Not later than the expiration of 

2 the 180-day period beginning on the date of the enactment 

3 of this Act, the Secretary shall issue any regulations nec4 essary to carry out this section. 

5 SEC. 4. REVIEW OF THE USE OF RESIDUAL RECEIPTS AND 

6 RESERVE FOR REPLACEMENTS FUNDS. 

7 The Secretary of Housing and Urban Development 

8 shall— 

9 (1) review its regulations and agreements con10 cerning residual receipts accounts in Federally as11 sisted rental housing subject to a limitation on dis12 tributions under section 200.106(a), 236.1(c), 

13 880.205(b), 881.205, or 883.306(b) of title 24 of 

14 the Code of Federal Regulations, or any other stat15 ute or regulation applicable to the project to clarify 

16 if the use of such funds for other project purposes 

17 includes activities related to the energy efficiency at 

18 properties with such residual receipts accounts; and 

19 (2) revise its policies with regards to the use of 

20 reserve for replacement funds to encourage the use 

21 of such reserves, where practical, for energy effi22 ciency items. 


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1 SEC. 5. STUDY ON EXEMPTION FROM BUILDING CODES TO 

2 ALLOW DISTRIBUTIVE ENERGY GENERATION 

3 MEASURES AND WATER EFFICIENCY MEAS4 URES. 

5 (a) STUDY.—The Comptroller General of the United 

6 States shall conduct a study to analyze and determine the 

7 benefits of establishing a statutory exemption under Fed8 eral law from compliance with provisions of State and local 

9 building codes that do not affect the health or safety of 

10 residents of multifamily housing assisted by the Depart11 ment of Housing and Urban Development to enable and 

12 encourage the construction and installation in such 

13 projects of distributive energy generation measures and 

14 water efficiency measures. 

15 (b) PROVISION OF INFORMATION TO ENERGY INFOR16 MATION ADMINISTRATION.—The Comptroller General 

17 shall provide any information collected in conducting the 

18 study under this section to the Secretary of Energy to sup19 plement information collected and maintained by the En20 ergy Information Administration of the Department of 

21 Energy regarding residential energy consumption. 

22 (c) REPORT.—Not later than the expiration of the 6- 

23 month period beginning on the date of the enactment of 

24 this Act, the Comptroller General shall submit a report 

25 to the Congress and to the Secretary of Energy setting 


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1 forth the results and conclusions of the study under this 

2 section. 

3 SEC. 6. REPORTS ON UTILITY CONSUMPTION FOR HUD-AS4 SISTED MULTIFAMILY PROJECTS. 

5 (a) IN GENERAL.—To assist the Secretary of Hous6 ing and Urban Development in determining how and 

7 where to undertake energy and other utility efficiency 

8 measures, the Secretary shall, by regulation, require each 

9 owner of an assisted multifamily housing project to report 

10 regularly to the Secretary regarding consumption by the 

11 project of electricity, water, gas, and other utilities. 

12 (b) ANNUAL REPORT BY SECRETARY.—The Sec13 retary shall compile the information received pursuant to 

14 subsection (a) and submit a report to the Congress and 

15 the Energy Information Administration annually regard16 ing total utility consumption by assisted multifamily hous17 ing projects. The report shall include all non-aggregated 

18 data submitted to the Secretary pursuant to subsection 

19 (a). 

20 (c) ASSISTED MULTIFAMILY HOUSING PROJECT.— 

21 For purposes of this section, the term ‘‘assisted multi22 family housing project’’ means any multifamily housing 

23 project that is— 

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1 cluding new construction and substantial rehabilita2 tion projects; 

3 (2) assisted under section 202 of the Housing 

4 Act of 1959 (as amended by section 801 of the 

5 Cranston-Gonzalez National Affordable Housing 

6 Act); 

7 (3) assisted under section 202 of the Housing 

8 Act of 1959, as such section existed before the en9 actment of the Cranston-Gonzalez National Afford10 able Housing Act; 

11 (4) assisted under section 811 of the Cranston12 Gonzalez National Affordable Housing Act; 

13 (5) financed by a loan or mortgage insured 

14 under section 221(d)(3) of the National Housing Act 

15 that bears interest at a rate determined under the 

16 proviso of section 221(d)(5) of such Act; or 

17 (6) insured, assisted, or held by the Secretary 

18 or a State or State agency under section 236 of the 

19 National Housing Act. 

Æ 


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