H. R. 2517

One Hundred Third Congress

of the

United States of America

AT THE FIRST SESSION

Begun and held at the City of Washington on Tuesday,

the fifth day of January, one thousand nine hundred and ninety-three

An Act

To enable the Secretary of Housing and Urban Development to demonstrate innovative strategies for assisting homeless individuals, to develop the capacity of community development corporations and community housing development organizations

to undertake community development and affordable housing projects and programs, to encourage pension fund investment in affordable housing, 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.

This Act may be cited as the ‘‘HUD Demonstration Act of

1993’’.

SEC. 2. INNOVATIVE HOMELESS INITIATIVES DEMONSTRATION PROGRAM.

(a) PURPOSE.—The purpose of this section is to enable the

Secretary of Housing and Urban Development (hereafter in this

Act referred to as the ‘‘Secretary’’), through cooperative efforts in

partnership with other levels of government and the private sector,

including nonprofit organizations, foundations, and communities,

to demonstrate methods of undertaking comprehensive strategies

for assisting homeless individuals and families (including homeless

individuals who have AIDS or who are infected with HIV), through

a variety of activities, including the coordination of efforts and

the filling of gaps in available services and resources. In carrying

out the demonstration, the Secretary shall—

(1) provide comprehensive homeless demonstration grants

under subsection (c); and

(2) provide innovative project funding under subsection

(d).

(b) DEFINITIONS.—For purposes of this section, the following

definitions shall apply:

(1) HOMELESS INDIVIDUAL.—The term ‘‘homeless individual’’

has the meaning given such term in section 103 of the Stewart

B. McKinney Homeless Assistance Act.

(2) HOMELESS FAMILY.—The term ‘‘homeless family’’ means

a group of one or more related individuals who are homeless

individuals.

(3) INCORPORATED DEFINITIONS.—The terms ‘‘State’’,

‘‘metropolitan city’’, ‘‘urban county’’, ‘‘unit of general local

government’’, and ‘‘Indian tribe’’ have the meanings given such

terms in section 102(a) of the Housing and Community Development Act of 1974.
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(4) JURISDICTION.—The term ‘‘jurisdiction’’ means a State,

metropolitan city, urban county, unit of general local government (including units in rural areas), or Indian tribe.

(5) NONPROFIT ORGANIZATION.—The term ‘‘nonprofit

organization’’ means an organization—

(A) no part of the net earnings of which inures to

the benefit of any member, founder, contributor, or individual;

(B) that, in the case of a private nonprofit organization,

has a voluntary board;

(C) that has an accounting system, or has designated

a fiscal agent in accordance with requirements established

by the Secretary; and

(D) that practices nondiscrimination in the provision

of assistance.

(6) VERY LOW-INCOME FAMILIES.—The term ‘‘very lowincome families’’ has the meaning given such term in section

3 of the United States Housing Act of 1937.

(c) COMPREHENSIVE HOMELESS INITIATIVE.—

(1) DESIGNATION.—The Secretary shall designate such

jurisdictions as the Secretary may determine for comprehensive

homeless initiative funding under this subsection.

(2) AUTHORITY.—The Secretary may provide assistance

under this subsection to—

(A) jurisdictions designated under paragraph (1) (or

entities or instrumentalities established under the authority of such jurisdictions); or

(B) nonprofit organizations operating within such jurisdictions,

establish comprehensive homeless initiatives to carry out the

purpose of this section.

(3) CRITERIA.—The Secretary shall establish criteria for designating jurisdictions under paragraph (1), which shall

include—

(A) the extent of homelessness in the jurisdiction;

(B) the extent to which the existing public and private

systems for homelessness prevention, outreach, assessment,

shelter, services, transitional services, transitional housing,

and permanent housing available within the jurisdiction

would benefit from additional resources to achieve a comprehensive approach to meeting the needs of individuals

and families who are homeless or who are very low-income

and at risk of homelessness;

(C) the demonstrated willingness and capacity of the

jurisdiction to work cooperatively with the Department of

Housing and Urban Development (hereafter in this Act

referred to as the ‘‘Department’’), nonprofit organizations,

foundations, other private entities, and the community to

design and implement an initiative to achieve the purposes

of this subsection;

(D) the demonstrated willingness of nongovernmental

organizations to commit financial and other resources to

a comprehensive homeless initiative in the jurisdiction;

(E) the commitment of the jurisdiction to make necessary changes in policy and procedure to provide sufficient

flexibility and resources as necessary to implement and

sustain the initiative;
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(F) national geographic diversity in the designation

of jurisdiction; and

(G) such other factors as the Secretary determines

to be appropriate.

(4) CONSULTATION.—Prior to designating jurisdictions

under paragraph (1), the Secretary shall consult with the

Committee on Banking, Finance and Urban Affairs of the House

of Representatives and the Committee on Banking, Housing,

and Urban Affairs of the Senate regarding such designations.

(5) COMPREHENSIVE STRATEGY.—Recipients of assistance

under this subsection shall, in cooperation with the Secretary,

other governmental entities, nonprofit organizations, foundations, other private entities, and the community, develop a

comprehensive plan that—

(A) sets forth a realistic and feasible strategy that

contains specific projects and activities to carry out the

purpose of this section;

(B) demonstrates the willingness of the appropriate

government and private entities and other parties to

participate cooperatively in this plan;

(C) specifies the projects and activities to be funded

under this subsection;

(D) provides an estimate of the cost of implementing

the initiative funded under this subsection;

(E) enumerates amounts to be made available to fund

the comprehensive homeless initiative by participating

governmental entities, nonprofit organizations, foundations, and the community, as appropriate, and requests

funds from the Secretary pursuant to this subsection; and (F) provides such other information as the Secretary

determines to be appropriate.

(6) DESIGNATION.—The designation referred to in para- graph (1) and assistance provided under paragraph (2) shall

be made on a noncompetitive basis.

(d) INNOVATIVE PROJECT FUNDING.— (1) AUTHORITY.—The Secretary is authorized to provide

assistance under this subsection to jurisdictions and nonprofit

organizations operating within such jurisdictions to establish

innovative programs to carry out the purpose of this section. (2) APPLICATIONS.—Applications for assistance under this

subsection shall be in such form, and shall include such

information, as the Secretary shall determine. Each application

shall include—

(A) a description of the extent of homelessness in the

jurisdiction;

(B) an explanation of the extent to which the existing

systems, both public and private, for homelessness prevention, outreach, assessment, shelter, services, transitional

services, transitional housing, and permanent housing

available within the jurisdiction would benefit from additional resources to achieve a comprehensive approach to

meeting the needs of individuals and families who are

homeless, or who are very low-income and at risk of

homelessness;

(C) a description of the projects and activities for which

the applicant is requesting funding under this subsection

and the amounts requested;
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(D) the demonstrated willingness and capacity of the

jurisdiction to work cooperatively with the Department,

nonprofit organizations, foundations, other private entities,

and the community, to the extent feasible, to design and

implement an initiative to achieve the purposes of this

subsection;

(E) a statement of commitment from the jurisdiction

to make necessary changes in policy and procedure to provide sufficient flexibility and resources as necessary to

implement and sustain the program; and

(F) such other information as the Secretary determines

to be appropriate.

(3) CRITERIA.—The Secretary shall establish selection criteria for awarding assistance under this subsection, which shall

include—

(A) the extent to which the program described in the

application achieves the purpose of this section;

(B) the extent to which the applicant demonstrates

the capacity to implement a program that achieves the

purpose of this section;

(C) the extent to which the program described in the

application is innovative and may be replicated or may

serve as a model for implementation in other jurisdictions;

(D) diversity by geography and community type; and

(E) such other criteria as the Secretary determines

to be appropriate.

(e) REPORTS.—

(1) RECIPIENTS OF FUNDS.—Each recipient of funds under

subsections (c) and (d) shall submit to the Secretary a report

or series of reports, in a form and at a time specified by

the Secretary. Each report shall—

(A) describe the use of funds made available under

this section; and

(B) include a description and an analysis of the programs and projects funded, the innovative approaches

taken, and the level of cooperation among participating

parties.

(2) INTERIM HUD REPORT.—The Secretary shall submit to

the Congress, in conjunction with the 1995 legislative recommendations of the Department, a report describing the

results of the demonstration program funded under this section

to date. The report shall contain a summary and analysis

of all information contained in any reports received by the

Secretary pursuant to paragraph (1) and shall contain recommendations for future action.

(3) FINAL HUD REPORT.—Not later than 3 months after

all recipient reports have been submitted under paragraph

(1), the Secretary shall submit to the Congress a final report.

The Secretary’s final report shall contain a summary and analysis of all information contained in the reports received by

the Secretary pursuant to paragraph (1) and shall contain

recommendations for future action.

(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized

to be appropriated $200,000,000 for fiscal year 1994 to carry out

this section. Of the amounts appropriated pursuant to this subsection, not less than 25 percent shall be used to carry out innova-
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tive project funding under subsection (d). All funds shall remain

available until expended.

(g) REPEAL.—This section shall be repealed effective on October 1, 1994.

SEC. 3. MOVING TO OPPORTUNITIES.

Section 152(e) of the Housing and Community Development

Act of 1992 (42 U.S.C. 1437f note) is amended in the first sentence

by striking ‘‘$52,100,000’’ and inserting ‘‘$165,000,000’’.

SEC. 4. CAPACITY BUILDING FOR COMMUNITY DEVELOPMENT AND

AFFORDABLE HOUSING.

(a) IN GENERAL.—The Secretary is authorized to provide assistance through the National Community Development Initiative to

develop the capacity and ability of community development corporations and community housing development organizations to undertake community development and affordable housing projects and

programs.

(b) FORM OF ASSISTANCE.—Assistance under this section may

be used for—

(1) training, education, support, and advice to enhance

the technical and administrative capabilities of community

development corporations and community housing development

organizations;

(2) loans, grants, or predevelopment assistance to community development corporations and community housing development organizations to carry out community development and

affordable housing activities that benefit low-income families;

and

(3) such other activities as may be determined by the

National Community Development Initiative in consultation

with the Secretary.

(c) MATCHING REQUIREMENT.—Assistance provided under this

section shall be matched from private sources in an amount equal

to 3 times the amount made available under this section.

(d) IMPLEMENTATION.—The Secretary shall by notice establish

such requirements as may be necessary to carry out the provisions

of this section. The notice shall take effect upon issuance.

(e) AUTHORIZATION.—There are authorized to be appropriated

$25,000,000 for fiscal year 1994 to carry out this section.

SEC. 5. AUTHORIZATION FOR COMMUNITY HOUSING PARTNERSHIPS

AND SUPPORT FOR STATE AND LOCAL HOUSING STRATEGIES.

Section 205 of the Cranston-Gonzalez National Affordable Housing Act (12 U.S.C. 12724) is amended—

(1) in paragraph (1), by striking ‘‘$14,000,000 for fiscal

year 1994’’ and inserting ‘‘$25,000,000 for fiscal year 1994’’;

and

(2) in paragraph (2), by striking ‘‘$11,000,000 for fiscal

year 1994’’ and inserting ‘‘$22,000,000 for fiscal year 1994’’.

SEC. 6. SECTION 8 COMMUNITY INVESTMENT DEMONSTRATION PROGRAM.

(a) DEMONSTRATION PROGRAM.—The Secretary shall carry out

a demonstration program to attract pension fund investment in

affordable housing through the use of project-based rental assistance under section 8 of the United States Housing Act of 1937.
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(b) FUNDING REQUIREMENTS.—In carrying out this section, the

Secretary shall ensure that not less than 50 percent of the funds

appropriated for the demonstration program each year are used

in conjunction with the disposition of either—

(1) multifamily properties owned by the Department; or

(2) multifamily properties securing mortgages held by the

Department.

(c) CONTRACT TERMS.—

(1) IN GENERAL.—Project-based assistance under this section shall be provided pursuant to a contract entered into

by the Secretary and the owner of the eligible housing that—

(A) provides assistance for a term of not less than

60 months and not greater than 180 months; and

(B) provides for contract rents, to be determined by

the Secretary, which shall not exceed contract rents permitted under section 8 of the United States Housing Act

of 1937, taking into consideration any costs for the

construction, rehabilitation, or acquisition of the housing.

(2) AMENDMENT TO SECTION 203.—Section 203 of the Housing and Community Development Amendments of 1978 (12

U.S.C. 1701z–11) is amended by adding at the end the following

new subsection:

‘‘(l) Project-based assistance in connection with the disposition

of a multifamily housing project may be provided for a contract

term of less than 15 years if such assistance is provided—

‘‘(1) under a contract authorized under section 6 of the

HUD Demonstration Act of 1993; and

‘‘(2) pursuant to a disposition plan under this section for

a project that is determined by the Secretary to be otherwise

in compliance with this section.’’.

(d) LIMITATION.—(1) The Secretary may not provide (or make a commitment to provide) more than 50 percent of the funding

for housing financed by any single pension fund, except that this

limitation shall not apply if the Secretary, after the end of the

6-month period beginning on the date notice is issued under subsection (e)—

(A) determines that—

(i) there are no expressions of interest that are likely

to result in approvable applications in the reasonably

foreseeable future; or

(ii) any such expressions of interest are not likely to

use all funding under this section; and

(B) so informs the Committee on Banking, Finance and

Urban Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate.

(2) If the Secretary determines that there are expressions of

interest referred to in paragraph (1)(A)(ii), the Secretary may

reserve funding sufficient in the Secretary’s determination to fund

such applications and may use any remaining funding for other

pension funds in accordance with this section.

(e) IMPLEMENTATION.—The Secretary shall by notice establish

such requirements as may be necessary to carry out the provisions

of this section. The notice shall take effect upon issuance.

(f) APPLICABILITY OF ERISA.—Notwithstanding section 514(d)

of the Employee Retirement Income Security Act of 1974, nothing

in this section shall be construed to authorize any action or failure

to act that would constitute a violation of such Act.
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(g) REPORT.—Not later than 3 months after the last day of

each fiscal year, the Secretary shall submit to the Committee on

Banking, Finance and Urban Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs

of the Senate a report summarizing the activities carried out under

this section during that fiscal year.

(h) ESTABLISHMENT OF STANDARDS.—Mortgages secured by

housing assisted under this demonstration shall meet such standards regarding financing and securitization as the Secretary may

establish.

(i) GAO STUDY.—The Comptroller General of the United States

shall conduct a study evaluating the demonstration authorized

under this section and shall report its findings to the Committee

on Banking, Finance and Urban Affairs of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs

of the Senate not later than 3 months after the conclusion of

the demonstration.

(j) AUTHORIZATION OF APPROPRIATIONS.—There are authorized

to be appropriated $100,000,000 for fiscal year 1994 to carry out

this section.

(k) TERMINATION DATE.—The Secretary shall not enter into

any new commitment to provide assistance under this section after

September 30, 1998.

SEC. 7. NATIONAL COMMISSION ON MANUFACTURED HOUSING.

(a) EXTENSION OF COMMISSION.—Section 943(g) of the CranstonGonzalez National Affordable Housing Act (Public Law 101–625;

104 Stat. 4415) is amended by striking ‘‘on October 1, 1993’’ and

inserting ‘‘on October 1, 1994’’.

(b) FINAL REPORT.—Section 943(d)(2) of the Cranston-Gonzalez

National Affordable Housing Act (Public Law 101–625; 104 Stat.

4414) is amended by striking ‘‘9 months after the Commission

is established pursuant to subsection (b)’’ and inserting ‘‘August

1, 1994’’.

(c) INTERIM REPORT.—Section 943(d) of the Cranston-Gonzalez

National Affordable Housing Act (Public Law 101–625; 104 Stat.

4414) is amended—

(1) by redesignating paragraph (2) (as amended by subsection (b) of this section) as paragraph (3); and

(2) by inserting after paragraph (1) the following new paragraph:

‘‘(2) INTERIM REPORT.—Not later than March 1, 1994, the

Commission shall submit an interim report to the Secretary

and the Congress. The report shall describe the activities of

the Commission under paragraph (1) and shall contain any

information specified in such paragraph that is available to

the Commission and any evaluations and recommendations

specified in such paragraph that may be made by the Commission, at such time.’’.

(d) AUTHORIZATION OF APPROPRIATIONS.—Section 943(f) of the

Cranston-Gonzalez National Affordable Housing Act (Public Law

101–625; 104 Stat. 4415) is amended by inserting after the first

sentence the following new sentence: ‘‘There are authorized to be

appropriated for fiscal year 1994 such sums as may be necessary

to carry out this section.’’.
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SEC. 8. RECIPROCITY IN APPROVAL OF HOUSING SUBDIVISIONS

AMONG FEDERAL AGENCIES.

(a) EXTENSION OF AUTHORITY.—Section 535(b) of the Housing Act of 1949 (42 U.S.C. 1490o(b)) is amended by striking ‘‘June

15, 1993’’ and inserting ‘‘September 30, 1994’’. (b) RETROACTIVITY.—An administrative approval of a housing subdivision made after June 15, 1993, and before the date of the

enactment of this Act is approved and shall be considered to have

been lawfully made, but only if otherwise made in accordance

with the provisions of section 535(b) of the Housing Act of 1949.

SEC. 9. FHA INSURANCE AUTHORITY.

Section 531(b) of the National Housing Act (12 U.S.C. 1735f– 9(b)) is amended by striking ‘‘$65,905,824,960’’ and inserting

‘‘$110,165,000,000’’.

SEC. 10. GNMA GUARANTEE AUTHORITY.

Section 306(g)(2) of the National Housing Act (12 U.S.C. 1721(g)(2)) is amended by striking ‘‘$88,000,000,000’’ and inserting

‘‘$107,700,000,000’’.

SEC. 11. ADMINISTRATION OF SECTION 8 PROGRAM.

(a) ADMINISTRATIVE FEE.—Notwithstanding the second sentence of section 8(q)(1) of the United States Housing Act of 1937, other

applicable law, or any implementing regulations and related

requirements, the fee for the ongoing costs of administering the

certificate and housing voucher programs under subsections (b)

and (o) of section 8 of such Act during fiscal year 1994 shall

be—

(1) not less than a fee calculated in accordance with the

fair market rents for Federal fiscal year 1993; or (2) not more than—

(A) a fee calculated in accordance with section 8(q)

of such Act, except that such fee shall not be in excess

of 3.5 percent above the fee calculated in accordance with

paragraph (1); or (B) to the extent approved in an appropriation Act, a fee calculated in accordance with such section 8(q). (b) STUDY.— (1) IN GENERAL.—The Secretary shall conduct a study assessing the costs incurred by public housing agencies in

administering the voucher and certificate programs under subsections (b) and (o) of section 8 of the United States Housing

Act of 1937.

(2) SPECIFIC REQUIREMENTS.—The study conducted under

this subsection shall—

(A) take into account variances in costs attributable

to the geographic area, the tenant population, and the

number of units covered by a public housing agency; and

(B) include an analysis of the costs associated with

Federal mandates, such as the family self-sufficiency program, and such other factors that the Secretary determines

to be appropriate.

(3) SUBMISSION TO CONGRESS.—The Secretary shall submit

to the Congress a report containing the results of the study

conducted under this subsection in conjunction with the Department of Housing and Urban Development’s 1994 legislative

recommendations.
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SEC. 12. AMENDMENTS TO PUBLIC LAW 102–389.

(a) EXTENSION OF TIME.—Subject to appropriations made in

advance in an appropriations Act, title II of the Departments of

Veterans Affairs and Housing and Urban Development, and

Independent Agencies Appropriations Act, 1993 (Public Law 102–

389), is amended under the heading ‘‘Administrative Provisions’’

in the second undesignated paragraph by striking ‘‘October 1, 1993’’

and inserting ‘‘October 1, 1994’’. (b) PROJECT-BASED ASSISTANCE.—Title II of the Departments

of Veterans Affairs and Housing and Urban Development, and

Independent Agencies Appropriations Act, 1993 (Public Law 102–

389), is amended under the heading ‘‘Administrative Provisions’’

in the ninth undesignated paragraph by inserting ‘‘(which may

be project-based assistance)’’ after ‘‘36 units’’.

Speaker of the House of Representatives.

Vice President of the United States and

President of the Senate.