day period referred to in subparagraph (B), and
has substantiated such interest if requested, the
Secretary, upon approval of a disposition plan
for a project, shall notify the unit of general
local government and designated State agency
of the terms and conditions of the disposition
plan and give the unit of general local govern-
ment or designated State agency not more than
90 days after the date of such notification to
make an offer to purchase the project.
‘‘(D) NO TIMELY EXPRESSION OF INTER-
EST.—If the unit of general local government or
designated State agency does not express inter-
est before the expiration of the 45-day period
referred to in subparagraph (B), or does not
substantiate an expressed interest if requested,
the Secretary, upon approval of a disposition
plan, may offer the project for sale to any inter-
ested person or entity.
‘‘(2)
ACCEPTANCE
OF
OFFERS.—Where
the
Secretary has given the unit of general local govern-
ment or designated State agency 90 days to make
an offer to purchase the project, the Secretary shall
accept an offer that complies with the terms and
conditions of the disposition plan. The Secretary
may accept an offer that does not comply with the
terms and conditions of the disposition plan if the
Secretary determines that the offer will further the
goals specified in subsection (a) by actions that in-
clude extension of the duration of low-income afford-
ability restrictions or otherwise restructuring the
transaction in a manner that enhances the long-term
affordability for low-income persons. The Secretary
shall, in particular, have discretion to reduce the ini-
tial sales price in exchange for the extension of low-
income affordability restrictions beyond the period of
assistance contemplated by the attachment of assist-
ance pursuant to subsection (e). If the Secretary and
the unit of general local government or designated
State agency cannot reach agreement within 90
days, the Secretary may offer the project for sale to
the general public.
‘‘(3) PURCHASE BY UNIT OF GENERAL LOCAL
GOVERNMENT
OR
DESIGNATED
STATE
AGENCY.—
Notwithstanding any other provision of law, a unit
of general local government (including a public hous-
ing agency) or designated State agency may pur-
chase a subsidized or formerly subsidized project in
accordance with this subsection.
‘‘(4)
APPLICABILITY.—This
subsection
shall
apply to projects that are acquired on or after the
effective date of this subsection. With respect to
projects acquired before such effective date, the Sec-
retary may apply—
‘‘(A) the requirements of paragraphs (2)
and (3) of section 203(e) as such paragraphs
existed immediately before the effective date of
this subsection; or
‘‘(B) the requirements of paragraphs (1)
and (2) of this subsection, if the Secretary gives
the unit of general local government or des-
ignated State agency—
‘‘(i) 45 days to express interest in the
project; and
‘‘(ii) if the unit of general local gov-
ernment or designated State agency ex-
presses interest in the project before the
expiration of the 45-day period, and sub-
stantiates such interest if requested, 90
days from the date of notification of the
terms and conditions of the disposition
plan to make an offer to purchase the
project.
‘‘(k) DISPLACEMENT OF TENANTS AND RELOCATION
ASSISTANCE.—
‘‘(1) IN GENERAL.—Whenever tenants will be
displaced as a result of the disposition of, or repairs
to, a multifamily housing project that is owned by
the Secretary (or for which the Secretary is mortga-
gee in possession), the Secretary shall identify ten-
ants who will be displaced, and shall notify all such
tenants of their pending displacement and of any re-
location assistance which may be available. In the
case of a multifamily housing project that is not
owned by the Secretary (and for which the Secretary
is not mortgagee in possession), the Secretary shall
require the owner of the project to carry out the re-
quirements of this paragraph.
‘‘(2) RIGHTS
OF
DISPLACED
TENANTS.—The
Secretary shall assure for any such tenant (who con-
tinues to meet applicable qualification standards)
the right—
‘‘(A) to return, whenever possible, to a re-
paired unit;
‘‘(B) to occupy a unit in another multifam-
ily housing project owned by the Secretary;
‘‘(C) to obtain housing assistance under
the United States Housing Act of 1937; or
‘‘(D) to receive any other available reloca-
tion assistance as the Secretary determines to
be appropriate.
‘‘(l) MORTGAGE AND PROJECT SALES.—
‘‘(1) IN GENERAL.—The Secretary may not ap-
prove the sale of any loan or mortgage held by the
Secretary (including any loan or mortgage owned by
the Government National Mortgage Association) on
any
subsidized
project
or
formerly
subsidized
project, unless such sale is made as part of a trans-
action that will ensure that such project will con-
tinue to operate at least until the maturity date of
such loan or mortgage, in a manner that will provide
rental housing on terms at least as advantageous to
existing and future tenants as the terms required by
the program under which the loan or mortgage was
made or insured prior to the assignment of the loan
or mortgage on such project to the Secretary.
‘‘(2) SALE OF CERTAIN PROJECTS.—The Sec-
retary may not approve the sale of any subsidized
project—
‘‘(A) that is subject to a mortgage held by
the Secretary; or
‘‘(B) if the sale transaction involves the
provision of any additional subsidy funds by the
Secretary or a recasting of the mortgage, unless
such sale is made as part of a transaction that
will ensure that such project will continue to
operate at least until the maturity date of the
loan or mortgage, in a manner that will provide
rental housing on terms at least as advan-
tageous to existing and future tenants as the
terms required by the program under which the
loan or mortgage was made or insured prior to
the proposed sale of the project.
‘‘(3) MORTGAGE SALES TO STATE AND LOCAL
GOVERNMENTS.—Notwithstanding any provision of
law that may require competitive sales or bidding,
the Secretary may carry out negotiated sales of sub-
sidized or formerly subsidized mortgages held by the
Secretary, without the competitive selection of pur-
chasers or intermediaries, to units of general local
government or State agencies, or groups of investors
that include at least one such unit of general local
government or State agency, if the negotiations are
conducted with such agencies, except that—
‘‘(A) the terms of any such sale shall in-
clude the agreement of the purchasing agency
or unit of local government or State agency to
act as mortgagee or owner of a beneficial inter-
retary is mortgagee in possession) as well as the
steps that the Secretary has taken or plans to take
to improve the management performance of the De-
partment.’’.
(c) EFFECTIVE DATE.—The Secretary shall, by no-
tice published in the Federal Register, which shall take
effect upon publication, establish such requirements as
may be necessary to implement the amendments made by
this section. The notice shall invite public comments, and
the Secretary shall issue final regulations based on the ini-
tial notice, taking into account any public comments re-
ceived.
Subtitle B—Merger of the
Certificate and Voucher Programs
SEC. 6101. MERGER OF CERTIFICATE AND VOUCHER PRO-
GRAMS.
The United States Housing Act of 1937 is amended
as provided in subsections (a) through (d) of this section.
(a) MERGER OF CERTIFICATE AND VOUCHER PRO-
GRAMS.—Section 8(o) is amended to read as follows:
‘‘(o) CERTIFICATE PROGRAM.—(1) The Secretary
may provide assistance for tenant-based assistance using
a payment standard in accordance with this subsection.
The payment standard shall be used to determine the
monthly assistance which may be paid for any family, as
provided in paragraph (2) of this subsection, and shall not
exceed the fair market rental established under subsection
(c). However, the payment standard for a designated part
of the market area may exceed the fair market rental by
not more than 20 percent where the Secretary determines
that higher market rents in a designated part of the mar-
ket area justify a higher payment standard. The Secretary
may require an agency to submit proposed payment stand-
ards to the Secretary for approval.
‘‘(2)(A) For a family receiving tenant-based assist-
ance, where the rent (including the amount allowed for
tenant-paid utilities) does not exceed the payment stand-
ard, the monthly assistance payment shall be the amount
by which the rent exceeds the highest of the following
amounts, rounded to the nearest dollar:
‘‘(i) 30 percent of the family’s monthly adjusted
income;
‘‘(ii) 10 percent of the family’s monthly income;
or
‘‘(iii) if the family is receiving payments for
welfare assistance from a public agency and a part
of such payments, adjusted in accordance with the
family’s actual housing costs, is specifically des-
ignated by such agency to meet the family’s housing
costs, the portion of such payments which is so des-
ignated.
‘‘(B) For a family receiving tenant-based assistance,
where the rent (including the amount allowed for tenant-
paid utilities) exceeds the payment standard, the monthly
assistance payment shall be the amount by which the ap-
plicable payment standard exceeds the highest of the fol-
lowing amounts, rounded to the nearest dollar:
‘‘(i) 30 percent of the family’s monthly adjusted
income;
‘‘(ii) 10 percent of the family’s monthly income;
or
‘‘(iii) if the family is receiving payments for
welfare assistance from a public agency and a part
of such payments, adjusted in accordance with the
family’s actual housing costs, is specifically des-
ignated by such agency to meet the family’s housing
costs, the portion of such payments which is so des-
ignated.
‘‘(C) For a family receiving project-based assistance,
the rent the family is required to pay shall be determined
in accordance with section 3(a)(1) and the amount of the
housing assistance payment shall be determined in accord-
ance with subsection (c)(3).
‘‘(3) At the time a family initially receives tenant-
based assistance with respect to any unit, the total amount
a family may pay towards rent may not exceed 45 percent
of the family’s monthly adjusted income.
‘‘(4) At the time a family initially receives assistance
under the certificate program, a family shall qualify as—
‘‘(A) a very low-income family;
‘‘(B) a family previously assisted under this
Act; or
‘‘(C) a low-income family that meets eligibility
criteria specified by the Secretary.
‘‘(5) Reviews of family income shall be made at least
annually.
‘‘(6)(A) In selecting families to be assisted, pref-
erence shall be given to families which, at the time they
are seeking assistance, (i) occupy substandard housing
(including families that are homeless or living in a shelter
for homeless families), (ii) are involuntarily displaced, or
(iii) are paying more than 50 percent of family income
for rent; except that any family otherwise eligible for as-
sistance under this section may not be denied preference
for tenant-based assistance (or delayed or otherwise ad-
versely affected in the provision of such assistance) solely
because the family resides in public housing.
‘‘(B) A public housing agency may provide for cir-
cumstances in which families who do not qualify for any
preference established in subparagraph (A) are provided
assistance under this subsection before families who do
qualify for such preference. However, not more than 10
percent in the case of tenant-based assistance and not
more than 30 percent in the case of project-based assist-
ance (or such higher percentage, in either case, deter-
mined by the Secretary to be necessary) of the families
who initially receive assistance in any 1-year period may
be families who do not qualify for such preference. The
public housing agency shall, in implementing the preced-
ing sentence, establish a system of preferences in writing
and after public hearing to respond to local housing needs
and priorities which may include—
‘‘(i) assisting very low-income families who ei-
ther reside in transitional housing assisted under
title IV of the Stewart B. McKinney Homeless As-
sistance Act, or participate in a program designed to
provide public assistance recipients with greater ac-
cess to employment and educational opportunities;
‘‘(ii) assisting families identified by local public
agencies involved in providing for the welfare of chil-
dren as having a lack of adequate housing that is a
primary factor in the imminent placement of a child
in foster care, or in preventing the discharge of a
child from foster care and reunification with his or
her family;
‘‘(iii) assisting youth, upon discharge from fos-
ter care, in cases in which return to the family or
extended family or adoption is not available;
‘‘(iv) assisting veterans who will use the assist-
ance for a dwelling unit designed for the handi-
capped, and upon discharge or eligibility for dis-
charge from a hospital or nursing home, have a
physical disability which, because of the configura-
tion of their homes, prevents them from access to or
use of their homes; and
‘‘(v) achieving other objectives of national hous-
ing policy as affirmed by Congress.
‘‘(C) Any individual or family evicted from housing
assisted under the Act by reason of drug-related criminal
activity (as defined in subsection (f)(5)) shall not be eligi-
ble for a preference under any provision of this subpara-
graph for 3 years unless the evicted tenant successfully
completes a rehabilitation program approved by the Sec-
retary (which shall include waiver for any member of a
family of an individual prohibited from tenancy under this
clause who the agency determines clearly did not partici-
pate in and had no knowledge of such criminal activity
or when circumstances leading to eviction no longer exist).
‘‘(7) The Secretary shall require, for any unit, that—
‘‘(A) the public housing agency inspect the unit
before any assistance payment may be made to de-
termine that the unit meets housing quality stand-
ards for decent, safe, and sanitary housing estab-
lished by the Secretary for the purpose of this sec-
tion; and
‘‘(B) the public housing agency make annual or
more frequent inspections during the contract term.
No assistance payment may be made for a dwelling unit
which fails to meet such quality standards, unless any
such failure is promptly corrected by the owner and the
correction is verified by the public housing agency.
‘‘(8) If a family vacates a dwelling unit, no assistance
payment may be made for the unit after the month during
which the unit was vacated.
‘‘(9) A public housing agency may adjust its payment
standard under this subsection where necessary to assure
continued affordability for families receiving tenant-based
assistance.
‘‘(10) The Secretary may set aside up to 5 percent
of the budget authority available under this subsection as
an adjustment pool. The Secretary shall use amounts in
the adjustment pool for adjustments pursuant to para-
graph (9) to ensure continued affordability where the Sec-
retary determines additional assistance for this purpose is
necessary, based on documentation submitted by a public
housing agency.
‘‘(11)(A) The rent for units assisted under this sub-
section shall be reasonable in comparison with rents
charged for comparable units in the private unassisted
market.
‘‘(B) A public housing agency shall, at the request
of a family receiving tenant-based assistance under this
subsection, assist such family in negotiating a reasonable
rent with an owner. A public housing agency shall review
the rent for a unit under consideration by the family (and
all rent increases for units under lease by the family) to
determine whether the rent (or rent increase) requested
by an owner is reasonable. If a public housing agency de-
termines that the rent (or rent increase) for a unit is not
reasonable, the agency shall disapprove a lease for such
unit.
‘‘(C) If units assisted under this subsection are ex-
empt from local rent control while they are so assisted,
the rent for such units shall be reasonable in comparison
with other units in the market area that are exempt from
local rent control.
‘‘(12)(A) A public housing agency may make assist-
ance payments on behalf of a family which utilizes a man-
ufactured home as its principal place of residence. Such
payments may be made for the rental of the real property
on which there is located a manufactured home which is
owned by any such family.
‘‘(B)(i) For assistance pursuant to this paragraph,
the rent for the space on which a manufactured home is
located and with respect to which assistance payments are
to
be
made
includes
maintenance
and
management
charges and tenant-paid utilities.
‘‘(ii) The public housing agency shall establish a pay-
ment standard for the purpose of determining the monthly
assistance which may be paid for any family under this
paragraph. The payment standard may not exceed an
amount approved or established by the Secretary.
‘‘(iii) The monthly assistance payment for assistance
under this paragraph shall be determined in accordance
with paragraph (2).
‘‘(13)(A) Where the Secretary enters into an annual
contributions contract with a public housing agency pursu-
ant to which the agency will enter into a contract for as-
sistance payments with respect to an existing structure
under this subsection, the contract for assistance pay-
ments may not be attached to the structure unless the
owner agrees to rehabilitate or newly construct the struc-
ture other than with assistance under this Act and other-
wise complies with the requirements of this section. The
public housing agency may approve such attachment for
up to 15 percent of the funding available for tenant-based
assistance administered by the agency under this section.
‘‘(B) Notwithstanding any other provision of this sec-
tion, a public housing agency and an applicable State
agency may, on a priority basis, attach to structures not
more than an additional 15 percent of the assistance only
with respect to projects assisted under a State program
that permits the owner of the projects to prepay a State-
assisted or State-subsidized mortgage on the structure.
However, the attachment of assistance under this sub-
paragraph shall be for the purpose of—
‘‘(i) providing incentives to owners to preserve
such projects for occupancy by low- and moderate-
income families (for the period that assistance under
this sentence is available), and
‘‘(ii) to assist low-income families to afford any
increases in rent that may be required to induce the
owner to maintain occupancy in the project by low-
and moderate-income families.
‘‘(C) Any assistance provided to low-income families
under subparagraph (B) shall not be considered for pur-
poses of the limitation under paragraph (6) regarding the
percentage of families that may receive assistance under
this section who do not qualify for preferences under that
paragraph.
‘‘(D) In the case of a contract for assistance pay-
ments that is attached to a structure under this para-
graph, a public housing agency shall enter into a contract
with an owner, contingent upon the future availability of
appropriations for the purpose of renewing expiring con-
tracts for assistance payments as provided in appropria-
tions Acts, to extend the term of the underlying contract
for assistance payments for such period or periods as the
Secretary determines to be appropriate to achieve long-
term affordability of the housing. The contract shall obli-
gate the owner to have such extensions of the underlying
contract for assistance payments accepted by the owner
and the owner’s successors in interest. To the extent as-
sistance is used as provided in the second sentence of sub-
paragraph (B), the contract for assistance may, at the op-
tion of the public housing agency, have an initial term not
exceeding 15 years.
‘‘(E) The Secretary shall annually survey public
housing agencies to determine which public housing agen-
cies have, in providing assistance in such year, reached
the 15 percent limitations contained in subparagraphs (A)
100
and (B), and shall report to the Congress on the results
of the survey.
‘‘(F) For project-based assistance under this para-
graph, assistance contracts shall establish rents, and pro-
vide for rent adjustments, in accordance with subsection
(c).
‘‘(14) A family may lease a unit, other than a public
housing unit, from the public housing agency with assist-
ance under this subsection. The Secretary may establish
appropriate program requirements for units owned by the
public housing agency, including requirements for HUD
approval of initial rents, rent adjustments, and adminis-
trative fees, taking into account that the agency admin-
istering the assistance is also the owner of the assisted
unit.
‘‘(15) Subsection (c) shall not apply to tenant-based
assistance under this subsection, except that subsections
(c)(9) and (c)(10) shall apply.’’.
(b) PORTABILITY.—Section 8(r) is amended—
(1) in each of paragraphs (1) and (3), by strik-
ing ‘‘subsection (b) or’’;
(2) in paragraph (3), by inserting at the end
the following new sentence: ‘‘The Secretary may re-
serve amounts available for assistance under sub-
section (o) to compensate public housing agencies
101
which issue certificates to families that move into
the jurisdiction of the agency under portability pro-
cedures.’’; and
(3) by adding the following new paragraph at
the end:
‘‘(5) A family may not receive a certificate from
an agency and move to another jurisdiction under
the tenant-based assistance program, if the family
has moved out of its assisted unit in violation of its
lease.’’.
(c)
HOMEOWNERSHIP
OPTION.—Section
8(y)
is
amended—
(1) in paragraph (1)(A), by inserting before the
semicolon ‘‘or owns or is acquiring shares in a coop-
erative’’;
(2) in paragraph (1)(B)(i), by inserting before
the semicolon ‘‘and demonstrates to the public hous-
ing agency that it has sufficient resources for home-
ownership’’; and
(3) by amending paragraph (2)(A) to read as
follows:
‘‘(A) DETERMINATION OF AMOUNT OF AS-
SISTANCE.—
‘‘(i) Where the monthly homeowner-
ship expenses, as determined in accordance