IIB 
110TH CONGRESS 
1ST SESSION H. R. 2895 
IN THE SENATE OF THE UNITED STATES 
OCTOBER 15, 2007 
Received; read twice and referred to the Committee on Banking, Housing, and 
Urban Affairs 
AN ACT 
To establish the National Affordable Housing Trust Fund 
in the Treasury of the United States to provide for 
the construction, rehabilitation, and preservation of de-
cent, safe, and affordable housing for low-income fami-
lies. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘National Affordable 
Housing Trust Fund Act of 2007’’. 
SEC. 2. NATIONAL AFFORDABLE HOUSING TRUST FUND. 
(a) IN GENERAL.—Title II of the Cranston-Gonzalez 
National Affordable Housing Act (42 U.S.C. 12721 et 
seq.) is amended by adding at the end the following new 
subtitle: 
‘‘Subtitle G—National Affordable 
Housing Trust Fund 
‘‘SEC. 291. PURPOSES. 
‘‘The purposes of this subtitle are— 
‘‘(1) to address the national shortage of hous-
ing that is affordable to low-income families by cre-
ating a permanently appropriated fund, with dedi-
cated sources of funding, to finance additional hous-
ing activities, without supplanting existing housing 
appropriations or existing State and local funding 
for affordable housing; 
‘‘(2) to enable rental housing to be built, for 
families with the greatest economic need, in mixed- 
income settings and in areas with the greatest eco-
nomic opportunities; 
‘‘(3) to promote ownership of one-to-four family 
owner-occupied housing by low-income families; and 
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‘‘(4) to construct, rehabilitate, and preserve at 
least 1,500,000 affordable dwelling units over the 
next decade. 
‘‘SEC. 292. TRUST FUND. 
‘‘(a) ESTABLISHMENT.—There is established in the 
Treasury of the United States a trust fund to be known 
as the National Affordable Housing Trust Fund. 
‘‘(b) DEPOSITS TO TRUST FUND.—The Trust Fund 
shall consist of— 
‘‘(1) any amounts of the Federal National 
Mortgage Association and the Federal Home Loan 
Mortgage Corporation transferred to the Trust 
Fund under title XIII of the Housing and Commu-
nity Development Act of 1992; 
‘‘(2) any amounts appropriated to the Trust 
Fund pursuant to the authorization in the Expand-
ing American Homeownership Act of 2007, relating 
to the use of FHA savings for an affordable housing 
grant fund; and 
‘‘(3) any amounts as are or may be appro-
priated, transferred, or credited to such Fund under 
any other provisions of law. 
‘‘(c) EXPENDITURES FROM TRUST FUND.—Amounts 
in the Trust Fund shall be available to the Secretary of 
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Housing and Urban Development, and are hereby appro-
priated, for providing assistance under this subtitle. 
‘‘(d) FEDERAL ASSISTANCE.—All assistance provided 
using amounts in the Trust Fund shall be considered to 
be Federal financial assistance. 
‘‘(e) CONDITIONS ON USE OF FHA SAVINGS.— 
‘‘(1) USE.—For each fiscal year, no funds may 
be made available under paragraph (2) of subsection 
(b) unless the amount equal to the net increase for 
such fiscal year in the negative credit subsidy for the 
mortgage insurance programs under title II of the 
National Housing Act resulting from the Expanding 
American Homeownership Act of 2007, and the 
amendments made by such Act, is first made avail-
able for the following purposes in the following 
amounts: 
‘‘(A) SINGLE FAMILY HOUSING MORTGAGE 
INSURANCE.—For each fiscal year, for costs (as 
such term is defined in section 502 of the Fed-
eral Credit Reform Act of 1990 (2 U.S.C. 
661a)) of mortgage insurance provided pursu-
ant to section 203(b) of the National Housing 
Act (12 U.S.C. 1709(b)), the additional amount 
(not including any costs of such mortgage in-
surance resulting from this Act or the amend-
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ments made by this Act), if any, necessary to 
ensure that the credit subsidy cost of such 
mortgage insurance for such fiscal year is $0. 
‘‘(B) HOUSING COUNSELING.—For each of 
fiscal years 2008 through 2012, the amount 
needed to increase funding, for the housing 
counseling program under section 106 of the 
Housing and Urban Development Act of 1968 
(12 U.S.C. 1701x), in connection with home-
buyers and homeowners with mortgages insured 
under title II of the National Housing Act, 
from the amount appropriated for the preceding 
fiscal year to $100,000,000. 
‘‘(C) 
MORTGAGE
INSURANCE
TECH-
NOLOGY, PROCEDURES, PROCESSES, PROGRAM 
PERFORMANCE, AND
SALARIES.—For each of 
fiscal years 2008 through 2012, $25,000,000 
for increasing funding for the purpose of im-
proving technology, procedures, processes, and 
program performance, and salaries in connec-
tion with the mortgage insurance programs 
under title II of the National Housing Act. 
‘‘(2) EXCLUSION OF EARNINGS FROM THE SIN-
GLE FAMILY MORTGAGE INSURANCE PROGRAM.—No 
funds under paragraph (2) of subsection (b) for a 
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fiscal year may be derived from the negative credit 
subsidy cost for such fiscal year, if any, for mort-
gage insurance provided pursuant to section 203(b) 
of the National Housing Act. 
‘‘(3) CERTIFICATION.—No funds may be made 
available under paragraph (2) of subsection (b) for 
any fiscal year unless the Secretary of Housing and 
Urban Development has, by rule making in accord-
ance with section 553 of title 5, United States Code 
(notwithstanding subsections (a)(2), (b)(B), and 
(d)(3) of such section), made a determination that 
premiums being, or to be, charged during such fiscal 
year for mortgage insurance under title II of the 
National Housing Act are established at the min-
imum amount sufficient to comply with the require-
ments of section 205(f) of such Act (relating to re-
quired capital ratio for the Mutual Mortgage Insur-
ance Fund) and ensure the safety and soundness of 
the other mortgage insurance funds under such Act, 
and any negative credit subsidy for such fiscal year 
resulting from such mortgage insurance programs 
adequately ensures the efficient delivery and avail-
ability of such programs. 
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‘‘(4) LIMITATION
ON
MORTGAGE
INSURANCE 
PREMIUM
INCREASES.—Notwithstanding any other 
provision of law— 
‘‘(A) the premiums charged for mortgage 
insurance under any program under the Na-
tional Housing Act may not be increased above 
the premium amounts in effect under such pro-
gram on October 1, 2006, unless the Secretary 
of Housing and Urban Development determines 
that, absent such increase, insurance of addi-
tional mortgages under such program would, 
under the Federal Credit Reform Act of 1990, 
require the appropriation of new budget author-
ity to cover the costs (as such term is defined 
in section 502 of the Federal Credit Reform 
Act of 1990 (2 U.S.C. 661a) of such insurance; 
and 
‘‘(B) a premium increase pursuant to 
paragraph (1) may be made only by rule mak-
ing in accordance with the procedures under 
section 553 of title 5, United States Code (not-
withstanding subsections (a)(2), (b)(B), and 
(d)(3) of such section). 
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‘‘SEC. 293. ALLOCATIONS FOR STATES, INDIAN TRIBES, IN-
SULAR AREAS, AND PARTICIPATING LOCAL 
JURISDICTIONS. 
‘‘(a) DETERMINATION OF AMOUNT AVAILABLE FOR 
FISCAL YEAR.—For fiscal year 2008 and for each fiscal 
year thereafter, the Secretary shall determine the total 
amount available from the Trust Fund pursuant to section 
292(c) for assistance under this subtitle and shall use such 
amount to provide such assistance for such fiscal year. 
‘‘(b) ALLOCATION.—For each such fiscal year, of 
such total amount available from the Trust Fund, the Sec-
retary shall allocate for use under section 294— 
‘‘(1) 40 percent for States, Indian tribes, and 
insular areas; and 
‘‘(2) 60 percent for participating local jurisdic-
tions. 
‘‘SEC. 294. ASSISTANCE FROM TRUST FUND. 
‘‘(a) AFFORDABLE HOUSING NEEDS FORMULA.— 
‘‘(1) ESTABLISHMENT
AND
FACTORS.—The 
Secretary shall establish a formula to allocate 
amounts made available for a fiscal year for assist-
ance under this subtitle among States, all Indian 
tribes, insular areas, and participating local jurisdic-
tions based on the relative needs of such entities, for 
funds to increase the supply of decent quality afford-
able housing. The formula shall be based upon a 
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comparison of the following factors with respect to 
each State, Indian tribes, each insular area, and 
each participating local jurisdiction: 
‘‘(A) The ratio of the population of the 
State, Indian tribes, insular area, or partici-
pating jurisdiction, to the aggregate population 
of all States, Indian tribes, insular areas, and 
participating jurisdictions. 
‘‘(B) The percentage of families in the ju-
risdiction of the State, of Indian tribes, or of 
the insular area or participating jurisdiction 
that live in substandard housing. 
‘‘(C) The percentage of families in the ju-
risdiction of the State, of Indian tribes, or of 
the insular area or participating jurisdiction 
that pay more than 50 percent of their annual 
income for housing costs. 
‘‘(D) The percentage of persons in the ju-
risdiction of the State, of Indian tribes, or of 
the insular area or participating jurisdiction 
having an income at or below the poverty line. 
‘‘(E) The cost of constructing or carrying 
out rehabilitation of housing in the jurisdiction 
of the State, of Indian tribes, or of the insular 
area or participating jurisdiction. 
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‘‘(F) The percentage of the population of 
the State, of Indian tribes, or of the insular 
area or participating jurisdiction that resides in 
counties having extremely low vacancy rates. 
‘‘(G) The percentage of housing stock in 
the jurisdiction of the State, of Indian tribes, or 
of the insular area or participating jurisdiction 
that is extremely old housing. 
‘‘(H) For the jurisdiction of a State, of In-
dian tribes, or of an insular area or partici-
pating jurisdiction that has an extremely low 
percentage of affordable rental housing, the ex-
tent to which the State, Indian tribes, or the in-
sular area or participating jurisdiction has in 
the preceding fiscal year increased the percent-
age of rental housing within its jurisdiction that 
is affordable housing. 
‘‘(I) Any other factors that the Secretary 
determines to be appropriate. 
‘‘(2) FAILURE TO ESTABLISH.—If, in any fiscal 
year referred to in section 293(a), the regulations 
establishing the formula required under paragraph 
(1) of this subsection have not been issued by the 
date that the Secretary determines the total amount 
available from the Trust Fund for assistance under 
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this subtitle for such fiscal year pursuant to section 
292(c), or there has been enacted before such date 
a joint resolution expressly disapproving the use of 
the formula required under paragraph (1) and sub-
mitted to the Congress pursuant to paragraph (3), 
for purposes of such fiscal year— 
‘‘(A) section 293(b), paragraphs (2) and 
(3) of subsection (b) of this section, and sub-
section (c) of this section shall not apply; 
‘‘(B) the allocation for Indian tribes shall 
be such amount as the Secretary shall establish; 
and 
‘‘(C) the formula amount for each State, 
insular area, or participating local jurisdiction 
shall be determined by applying, for such State, 
insular area, or participating local jurisdiction, 
the percentage that is equal to the percentage 
of the total amounts made available for such 
fiscal year for allocation under subtitle A of this 
title (42 U.S.C. 12741 et seq.) that are allo-
cated in such year, pursuant to such subtitle, to 
such State, insular area, or participating local 
jurisdiction, respectively, and the allocation for 
each State, insular area, or participating juris-
diction, for purposes of subsection (e) shall, ex-
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cept as provided in subsection (d), be the for-
mula amount for the State, insular area, or 
participating jurisdiction, respectively. 
‘‘(3) SUBMISSION
TO
CONGRESS.—Notwith-
standing any other provision of this subtitle, any for-
mula established by the Secretary pursuant to this 
subsection shall be submitted to the Committee on 
Financial Services of the House of Representatives 
and the Committee on Banking, Housing, and 
Urban Affairs of the Senate not less than 120 days 
before application of the formula for purposes of de-
termining formula amounts under subsection (b) for 
a fiscal year. Such submission shall be accompanied 
by a detailed explanation of the factors under the 
formula and anticipated effects of the formula. 
‘‘(b) FORMULA AMOUNT.— 
‘‘(1) IN
GENERAL.—For each fiscal year re-
ferred to in section 293(a), the Secretary shall deter-
mine the formula amount under this subsection for 
each State, for Indian tribes, for each insular area, 
and for each participating local jurisdiction. 
‘‘(2) STATES, INDIAN
TRIBES, AND
INSULAR 
AREAS.—The formula amount for each State, for In-
dian tribes, and for each insular area shall be the 
amount determined for such State, for Indian tribes, 
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or for such insular area by applying the formula 
under subsection (a) of this section to the total 
amount allocated under section 293(b)(1) for all 
States, Indian tribes, and insular areas for the fiscal 
year. 
‘‘(3) PARTICIPATING LOCAL JURISDICTIONS.— 
The formula amount for each participating local ju-
risdiction shall be the amount determined for such 
participating local jurisdiction by applying the for-
mula under subsection (a) of this section to the total 
amount allocated under section 293(b)(2) for all 
participating local jurisdictions for the fiscal year. 
‘‘(4) NOTICE.—For each fiscal year referred to 
in section 293(a), not later than 60 days after the 
date that the Secretary determines the total amount 
available from the Trust Fund for such fiscal year 
pursuant to section 292(c) for assistance under this 
subtitle, the Secretary shall cause to be published in 
the Federal Register a notice that such amounts 
shall be so available. 
‘‘(c) ALLOCATION BASED ON AFFORDABLE HOUSING 
NEEDS FORMULA.—The allocation under this subsection 
for a State, for Indian tribes, for an insular area, or for 
a local participating jurisdiction for a fiscal year shall be 
determined as follows: 
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‘‘(1) STATES.—Subject to subsection (d), the 
allocation for a State shall be as follows: 
‘‘(A) MINIMUM AMOUNT.—If the formula 
amount determined under subsection (b)(2) for 
the State for the fiscal year is less than 0.5 per-
cent of the total amount allocated for such fis-
cal year under section 293(b)(1), the allocation 
for the State shall be 0.5 percent of the total 
amount allocated for such fiscal year under sec-
tion 293(b)(1). 
‘‘(B) FORMULA AMOUNT.—If the formula 
amount determined under subsection (b)(2) for 
the State for the fiscal year is 0.5 percent or 
more of the total amount allocated for such fis-
cal year under section 293(b)(1), the allocation 
for the State shall be the formula amount for 
the State, except that— 
‘‘(i) the Secretary shall reduce such 
formula amounts for all States whose allo-
cations are determined under this subpara-
graph on a pro rata basis, except as pro-
vided in clause (ii), by the amount nec-
essary to account for any increases from 
the formula amount for allocations made 
under subparagraph (A), so that the total 
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of the allocations for all States pursuant to 
this paragraph is equal to the aggregate of 
the formula amounts under subsection 
(b)(2) for all States; and 
‘‘(ii) no reduction pursuant to clause 
(i) for any State may reduce the formula 
amount for the State to less than 0.5 per-
cent of such total amount allocated for 
such fiscal year. 
‘‘(2) INDIAN TRIBES AND INSULAR AREAS.— 
The allocation for Indian tribes and for each insular 
area shall be the formula amount for Indian tribes 
or for the insular area, respectively, determined 
under subsection (b), as applicable. 
‘‘(3) PARTICIPATING LOCAL JURISDICTIONS.— 
Subject to subsection (d), the allocation for each 
participating local jurisdiction shall be the formula 
amount for the jurisdiction determined under sub-
section (b). 
‘‘(d) ALLOCATION EXCEPTION FOR YEARS IN WHICH 
LESS THAN $2 BILLION IS AVAILABLE.—If, for any fiscal 
year, the total amount available pursuant to section 
293(a) for assistance under this subtitle is less than 
$2,000,000,000— 
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‘‘(1) for each participating local jurisdiction 
having a formula amount for such fiscal year of less 
than $750,000, the allocation shall be $0, except 
that the allocation for such a jurisdiction for such 
fiscal year shall be the formula amount for the juris-
diction for such fiscal year if— 
‘‘(A) the Secretary finds that the jurisdic-
tion has demonstrated a capacity to carry out 
provisions of this subtitle and the State in 
which such jurisdiction is located has author-
ized the Secretary to transfer to the jurisdiction 
a portion of the State’s allocation that is equal 
to or greater than the difference between the 
jurisdiction’s formula amount and $750,000, or 
the State or jurisdiction has made available 
such an amount from the State’s or jurisdic-
tion’s own sources available for use by the juris-
diction in accordance with this subtitle; or 
‘‘(B) the formula amount for such jurisdic-
tion for such fiscal year is an amount that is 
greater than the formula amount for such fiscal 
year for any other participating local jurisdic-
tion that is located in the same State; and 
‘‘(2) in the case of any jurisdiction whose allo-
cation is $0 by operation of paragraph (1), the allo-
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cation for the State in which such participating local 
jurisdiction is located shall be increased by the 
amount of the formula amount for the participating 
local jurisdiction. 
Any adjustments pursuant to paragraphs (1) and (2) shall 
be made notwithstanding the allocation percentages under 
section 293(b). 
‘‘(e) GRANT AWARDS.—For each fiscal year referred 
to in section 293(a), using the amounts made available 
to the Secretary from the Trust Fund for such fiscal year 
under section 292(c), the Secretary shall, subject to sub-
section (f), make a grant to each State, insular area, and 
participating local jurisdiction in the amount of the alloca-
tion under subsection (a)(2), (c), or (d), as applicable, for 
the State, area, or jurisdiction, respectively. 
‘‘(f) MATCHING REQUIREMENT.— 
‘‘(1) IN GENERAL.—Each grantee for a fiscal 
year shall contribute to eligible activities funded with 
Trust Fund grant amounts, or require the contribu-
tion to such eligible activities by recipients of such 
Trust Fund grant amounts of, in addition to any 
such grant amounts, not less than the following 
amount: 
‘‘(A) STATE, LOCAL, OR
PRIVATE
RE-
SOURCES.—To the extent that such contributed 
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amounts are derived from State, local, or pri-
vate resources, 12.5 percent of such grant 
amounts. 
‘‘(B) FEDERAL AMOUNTS.—To the extent 
that such contributed amounts are derived from 
State- or locally-controlled amounts from Fed-
eral assistance, or from amounts made available 
under the affordable housing program of a Fed-
eral Home Loan Bank pursuant to section 10(j) 
of the Federal Home Loan Bank Act (12 
U.S.C. 1430(j)), 25 percent of such grant 
amounts. 
Nothing in this paragraph may be construed to pre-
vent a grantee or recipient from complying with this 
paragraph only by contributions in accordance with 
subparagraph (A), only by contributions in accord-
ance with subparagraph (B), or by a combination of 
such contributions. 
‘‘(2) REDUCTION OR WAIVER FOR RECIPIENTS 
IN FISCAL DISTRESS.—The Secretary may reduce or 
waive the requirement under paragraph (1) with re-
spect to any grantee that the Secretary determines, 
pursuant to such demonstration by the recipient as 
the Secretary shall require, is in fiscal distress. The 
Secretary shall make determinations regarding fiscal 
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distress for purposes of this paragraph in the same 
manner, and according to the same criteria, as fiscal 
distress is determined with respect to jurisdictions 
under section 220(d) (42 U.S.C. 12750(d)). 
‘‘(3) QUALIFICATION
OF
SERVICES
FUNDING 
FOR MATCH.—For purposes of meeting the require-
ments of paragraph (1), amounts that a grantee, re-
cipient, or other governmental or private agency or 
entity commits to contribute to provide services to 
residents of affordable housing provided using grant 
amounts under this subtitle, by entering into a bind-
ing commitment for such contribution as the Sec-
retary shall require, shall be considered contribu-
tions to eligible activities. Amounts to be considered 
eligible contributions under this paragraph shall not 
exceed 33 percent of the total cost of the eligible ac-
tivity. 
‘‘(4) REDUCTION OR WAIVER FOR CERTAIN AC-
TIVITIES.—With respect to Trust Fund grant 
amounts made available for a fiscal year, the Sec-
retary shall reduce or waive the amount of contribu-
tions otherwise required under paragraph (1) to be 
made with respect to eligible activities to be carried 
out with such grant amounts and for which any vari-
ance from zoning laws or other waiver of regulatory 
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requirements was approved by the local jurisdiction. 
Such reduction may be implemented in the year fol-
lowing the year in which such activities are funded 
with Trust Fund grant amounts. 
‘‘(5) WAIVER
FOR
DISASTER
AREAS.—In the 
case of any area that is subject to a declaration by 
the President of a major disaster or emergency 
under the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act (42 U.S.C. 5121), the 
Secretary shall, for the fiscal year following such 
declaration, waive the requirement under paragraph 
(1) with respect to any eligible activities to be car-
ried out in such area. 
‘‘(g) COMPETITIVE GRANTS FOR INDIAN TRIBES.— 
For each fiscal year referred to in section 293(a), the Sec-
retary shall, using amounts allocated for Indian tribes 
pursuant to subsection (a)(2)(B) or (c)(2), as applicable, 
and subject to subsection (f), make grants to Indian tribes 
on a competitive basis, based upon such criteria as the 
Secretary shall establish, which shall include the factors 
specified in section 295(c)(2)(B). 
‘‘(h) USE BY STATE OF UNUSED FUNDS OF LOCAL 
JURISDICTIONS.—If any participating local jurisdiction 
for which an allocation is made for a fiscal year pursuant 
to this section notifies the Secretary of an intent not to 
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use all or part of such funds, any such funds that will 
not be used by the jurisdiction shall be added to the grant 
award under subsection (e) for the State in which such 
jurisdiction is located. 
‘‘(i) COMPETITIVE GRANTS FOR AREAS WITHOUT 
ALLOCATION PLANS AND RECIPIENTS WITH INSUFFI-
CIENT MATCHING CONTRIBUTIONS.— 
‘‘(1) AVAILABLE AMOUNTS.—For a fiscal year, 
the following amounts shall be available for grants 
under this subsection: 
‘‘(A) ALLOCATION FOR AREAS NOT SUB-
MITTING ALLOCATION PLANS.—With respect to 
each State, insular area, or participating local 
jurisdiction that has not, before the expiration 
of the 12-month period beginning upon the date 
of the publication of the notice of funding avail-
ability for such fiscal year under subsection 
(b)(4), submitted to and had approved by the 
Secretary an allocation plan for such fiscal year 
meeting the requirements of section 295, the 
amount of the allocation for such State, insular 
area, or participating local jurisdiction for such 
fiscal year determined under this section. 
‘‘(B) UNMATCHED
PORTION
OF
ALLOCA-
TION.—With respect to any grantee for which 
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the Trust Fund grant amount awarded for such 
fiscal year is reduced from the amount of the 
allocation determined under this section for the 
grantee by reason of failure comply with the re-
quirements under subsection (f), the amount by 
which such allocation for the grantee for the 
fiscal year exceeds the Trust Fund grant 
amount for the grantee for the fiscal year. 
‘‘(C) 
UNCOMMITTED
AMOUNTS.—Any 
Trust Fund grant amounts for a fiscal year 
that are not committed for use for eligible ac-
tivities before the expiration of the 24-month 
period beginning upon the date of the publica-
tion of the notice of availability of amounts 
under subsection (b)(4) for such fiscal year. 
‘‘(D) 
UNUSED
AMOUNTS.—Any 
Trust 
Fund grant amounts for which the grantee no-
tifies the Secretary that such funds will not be 
used under this subtitle. 
‘‘(2) NOTICE.—For each fiscal year, not later 
than 60 days after the date that the Secretary deter-
mines that the amounts described in paragraph (1) 
shall be available for grants under this subsection, 
the Secretary shall cause to be published in the Fed-
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eral Register a notice that such amounts shall be so 
available. 
‘‘(3) APPLICATIONS.—The Secretary shall pro-
vide for nonprofit and public entities (and consortia 
thereof, which may include regional consortia of 
units of local government) to submit applications, 
during the 9-month period beginning upon publica-
tion of a notice of funding availability under para-
graph (2) for a fiscal year, for a grant of all or a 
portion of the amounts referred to in paragraph (1) 
for such fiscal year. Such an application shall in-
clude a certification that the applicant will comply 
with all requirements of this subtitle applicable to a 
grantee under this subsection. 
‘‘(4) SELECTION
CRITERIA.—The Secretary 
shall, by regulation, establish criteria for selecting 
applicants that meet the requirements of paragraph 
(3) for funding under this subsection. Such criteria 
shall give priority to applications that provide that 
grant amounts under this subsection will be used for 
eligible activities relating to affordable housing that 
is located in the State or insular area, as applicable, 
for which such grant funds were originally allocated 
under this section. 
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‘‘(5) AWARD
AND
USE
OF
GRANT
ASSIST-
ANCE.— 
‘‘(A) AWARD.—Subject only to the absence 
of applications meeting the requirements of 
paragraph (3), upon the expiration of the pe-
riod referred to in such paragraph, the Sec-
retary shall select an applicant or applicants 
under this subsection to receive the amounts 
available under paragraph (1) and shall make a 
grant or grants to such applicant or applicants. 
The selection shall be based upon the criteria 
established under paragraph (4). 
‘‘(B) USE.—Amounts from a grant under 
this subsection shall be Trust Fund grant 
amounts for purposes of this subtitle. 
‘‘SEC. 295. ALLOCATION PLANS. 
‘‘(a) IN GENERAL.—Each grantee that is a State, in-
sular area, participating local jurisdiction, or grantee 
under section 294(i) for a fiscal year, shall establish an 
allocation plan in accordance with this section for the dis-
tribution of Trust Fund grant amounts provided to the 
grantee for such fiscal year, which shall be a plan that— 
‘‘(1) provides for use of such amounts in ac-
cordance with section 296; 
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‘‘(2) is based on priority housing needs, includ-
ing priority housing needs in rural areas, as deter-
mined by the grantee; and 
‘‘(3) is consistent with the comprehensive hous-
ing affordability strategy under section 105 (42 
U.S.C. 12705) or any applicable consolidated sub-
mission used for purposes of applying for other com-
munity planning and development and housing as-
sistance programs administered by the Secretary, for 
the applicable State, insular area, jurisdiction, or 
grantee under section 294(i). 
‘‘(b) ESTABLISHMENT.—In establishing an allocation 
plan, a grantee described in subsection (a) shall notify the 
public of the establishment of the plan, provide an oppor-
tunity for public comments regarding the plan, consider 
any public comments received, and make the completed 
plan available to the public. 
‘‘(c) CONTENTS.—Each allocation plan of a grantee 
described in subsection (a) shall comply with the following 
requirements: 
‘‘(1) APPLICATION REQUIREMENTS FOR ELIGI-
BLE
RECIPIENTS.—The allocation plan shall set 
forth the requirements for eligible recipients to apply 
to the grantee to receive assistance from Trust Fund 
grant amounts of the grantee for use for eligible ac-
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tivities, including a requirement that each such ap-
plication include— 
‘‘(A) a description of the eligible activities 
to be conducted using such assistance; 
‘‘(B) a certification by the eligible recipient 
applying for such assistance that any housing 
assisted with such grant amounts will comply 
with— 
‘‘(i) all of the requirements under this 
subtitle, including the targeting require-
ments under section 296(c) and the afford-
able housing requirements under section 
297; 
‘‘(ii) section 808(d) of the Fair Hous-
ing Act (relating to the obligation to af-
firmatively further fair housing); and 
‘‘(iii) section 504 of the Rehabilitation 
Act of 1973 (relating to prohibition of dis-
crimination on the basis of disability); and 
‘‘(C) in the case of any recipient who has 
received assistance from Trust Fund grant 
amounts in any previous fiscal year, a report on 
the progress made in carrying out the eligible 
activities funded with such previous assistance. 
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‘‘(2) SELECTION PROCESS AND CRITERIA FOR 
ASSISTANCE.— 
‘‘(A) SELECTION PROCESS.—The allocation 
plan shall set forth a process for the grantee to 
select eligible activities meeting the grantee’s 
priority housing needs for funding with Trust 
Fund grant amounts of the grantee, which shall 
comply with requirements for such process as 
the Secretary shall, by regulation, establish. 
‘‘(B) SELECTION
CRITERIA.—The alloca-
tion plan shall set forth the factors for consid-
eration in selecting among applicants that meet 
the application requirements established pursu-
ant to paragraph (1), which shall provide for 
geographic diversity among eligible activities to 
be assisted with Trust Fund grant amounts of 
the grantee and shall include— 
‘‘(i) the merits of the proposed eligible 
activity of the applicant, including the ex-
tent to which the activity addresses hous-
ing needs identified in the allocation plan 
of the grantee and the applicable com-
prehensive housing affordability strategy or 
consolidated submission referred to in sub-
section (a)(3); 
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‘‘(ii) the experience of the applicant, 
including its principals, in carrying out 
projects similar to the proposed eligible ac-
tivity; 
‘‘(iii) the ability of the applicant to 
obligate grant amounts for the proposed el-
igible activities and to undertake such ac-
tivities in a timely manner; 
‘‘(iv) the extent of leveraging of funds 
by the applicant from private and other 
non-Federal sources for carrying out the 
eligible activities to be funded with Trust 
Fund grant amounts, including assistance 
made available under section 8 of the 
United States Housing Act of 1937 (42 
U.S.C. 1437f) that is devoted to the 
project that contains the affordable hous-
ing to be assisted with such assistance; 
‘‘(v) the extent of local assistance that 
will be provided in carrying out the eligible 
activities, including financial assistance; 
‘‘(vi) the efficiency of total project 
fund use as measured by the cost per unit 
of the proposal, as adjusted by factors 
which shall include whether the funding 
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with Trust Fund grant amounts is for new 
construction, rehabilitation, preservation, 
or homeownership assistance, whether the 
project involves supportive housing, dif-
ferences in construction and rehabilitation 
costs in different areas of the grantee, and 
other appropriate adjustments; 
‘‘(vii) the degree to which the project 
in which the affordable housing will be lo-
cated will have residents of various in-
comes; 
‘‘(viii) the extent of employment and 
other economic opportunities for low-in-
come families in the area in which the 
housing will be located; 
‘‘(ix) the extent to which the applicant 
demonstrates the ability to maintain dwell-
ing units as affordable housing through the 
use of assistance made available under this 
subtitle, assistance leveraged from non- 
Federal sources, assistance made available 
under section 8 of the United States Hous-
ing Act of 1937 (42 U.S.C. 1437f), State 
or local assistance, programs to increase 
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tenant income, cross-subsidization, and any 
other resources; 
‘‘(x) the extent to which the applicant 
demonstrates that the county in which the 
housing is to be located is experiencing an 
extremely low vacancy rate; 
‘‘(xi) the extent to which the percent-
age of the housing located in such county 
that is extremely old housing exceeds 35 
percent; 
‘‘(xii) the extent to which the housing 
assisted with the grant amounts will be ac-
cessible to persons with disabilities; 
‘‘(xiii) the extent to which the appli-
cant demonstrates that the affordable 
housing assisted with the grant amounts 
will be located in proximity to public trans-
portation, job opportunities, child care, and 
community revitalization projects; 
‘‘(xiv) the extent to which the appli-
cant has provided that assistance from 
grant amounts will be used for eligible ac-
tivities relating to housing located in cen-
sus tracts in which the number of families 
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having incomes less than the poverty line is 
less than 20 percent; 
‘‘(xv) the extent to which the housing 
assisted with grant amounts will comply 
with energy efficiency standards and the 
national 
Green 
Communities 
criteria 
checklist for residential construction that 
provides criteria for the design, develop-
ment, and operation of affordable housing, 
as the Secretary shall by regulation pro-
vide; and 
‘‘(xvi) the extent to which the design, 
construction, and operation of the housing 
assisted with grant amounts reduces utility 
costs for residents and thereby reduces 
their total housing cost. 
A grantee may allocate a portion of funds 
under this section for use by such grantee for 
eligible activities pursuant to the selection proc-
ess under subparagraph (A). 
‘‘(3) USE FOR FIRST RESPONDERS AND TEACH-
ERS.—To the extent that Trust Fund grant 
amounts of a grantee are made available for eligible 
activities involving one- to four-family owner-occu-
pied housing, the grantee may give preference in the 
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