I
103D CONGRESS
2D SESSION
H. R. 4310
To reduce homelessness, reform public housing, expand and preserve afford-
able housing and homeownership, ensure fair housing for all, empower
communities, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
APRIL 28, 1994
Mr. GONZALEZ (by request) introduced the following bill; which was referred
to the Committee on Banking, Finance and Urban Affairs
A BILL
To reduce homelessness, reform public housing, expand and
preserve affordable housing and homeownership, ensure
fair housing for all, empower communities, and for other
purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SHORT TITLE AND TABLE OF CONTENTS
SECTION 1. (a) SHORT TITLE.—This Act may be
cited as the ‘‘Housing Choice and Community Investment
Act of 1994’’.
(b) TABLE OF CONTENTS.—
TITLE I—ASSISTANCE FOR THE HOMELESS
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Subtitle A—Reorganization of the Stewart B. McKinney Homeless Assistance
Act
Sec. 101. Short title.
Sec. 102. Findings and purposes.
Sec. 103. Definitions.
Sec. 104. Authorizations.
Sec. 105. Application.
Sec. 106. Eligible activities.
Sec. 107. Allocation and distribution of funds.
Sec. 108. Administration of program.
Sec. 109. Citizen participation.
Sec. 110. Reports, reviews, and audits.
Sec. 111. Nondiscrimination in programs and activities.
Sec. 112. Consultation.
Sec. 113. Records, reports, and audits.
Sec. 114. Reports to Congress.
Sec. 115. Innovative Homeless Program.
Subtitle B—Emergency Food and Shelter
Sec. 121. Transfer of the Emergency Food and Shelter Program from FEMA
to HUD.
TITLE II—PUBLIC AND INDIAN HOUSING; CROSS-CUTTING
AUTHORIZATIONS
Subtitle A—Enhance Flexibility for Public Housing Agencies
Sec. 201. Direct loans for modernization and replacement housing.
Sec. 202. Use of modernization funds for replacement housing.
Sec. 203. Facilitate use of public-private partnerships in modernizing public
housing.
Sec. 204. Modification of the Early Childhood Development Program.
Sec. 205. Entrepreneurial PHAs and RMCs.
Sec. 206. Disallowance of earned income for residents who obtain employment.
Sec. 207. Ceiling rents based on reasonable rental value.
Sec. 208. Authorization to sell public housing to nonprofit organizations.
Subtitle B—Severely Distressed Public Housing Program
Sec. 211. Revitalization of severely distressed public housing.
Sec. 212. Modernization program reserve funds.
Sec. 213. Eligibility of severely distressed public housing for public housing op-
erating subsidies.
Sec. 214. Applicability of section 24 and URD statute and rules.
Subtitle C—Anti-Crime Initiatives
Sec. 221. Community partnerships against crime.
Sec. 222. Authority for assisted housing owners and public housing agencies to
ban guns.
Sec. 223. Make criminal records available for screening and evictions.
Subtitle D—Authorizations and Extensions
Sec. 231. Low-income housing.
Sec. 232. Public housing operating subsidies.
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Sec. 233. Family self-sufficiency program.
Sec. 234. Public housing family investment centers.
Sec. 235. Revised Congregate Services Program.
Sec. 236. Indian Housing Loan Guarantee Program.
Subtitle E—Applicability
Sec. 241. Applicability of public housing amendments to Indian housing.
TITLE III—HOMEOWNERSHIP; FHA MORTGAGE INSURANCE
AUTHORIZATION
Subtitle A—Expand Single Family Homeownership Opportunities
Sec. 301. Single family mortgage insurance in revitalization areas.
Sec. 302. Maximum dollar amount for FHA single family mortgages.
Sec. 303. Streamlined refinancing for HUD-held mortgages.
Sec. 304. Innovative affordable housing demonstrations.
Sec. 305. Single Family Risk-Sharing Mortgage Insurance Program.
Sec. 306. Homeownership counseling and outreach.
Subtitle B—National Homeownership Fund Demonstration
Sec. 311. Amendments to NAHA.
Subtitle C—Authorizations
Sec. 321. Flexible Subsidy Program.
Sec. 322 Service coordinators in multifamily housing.
Sec. 323. Limitation on GNMA guarantees for mortgage-backed securities.
Sec. 324. Limitation on FHA insuring authority.
TITLE IV—ECONOMIC OPPORTUNITY; EXPANSION OF
AFFORDABLE HOUSING
Subtitle A—Economic Opportunity
Sec. 401. Economic opportunities for residents in HUD-assisted programs.
Sec. 402. Resident Management/Tenant Opportunity Program
Subtitle B—Section 8 Initiatives
Sec. 411. Choice in residency.
Sec. 412. Merger of the Certificate and Voucher Programs.
Sec. 413. Section 8 certificate and voucher fees.
Subtitle C—Miscellaneous
Sec. 421. Section 811 rental assistance for persons with disabilities.
Sec. 422. Funding for supportive housing for the elderly and for persons with
disabilities.
Sec. 423. Youthbuild.
Sec. 424. HOPE authorization of appropriations.
Sec. 425. Authorization of appropriations for housing opportunities for Persons
with AIDS Program.
TITLE V—PRESERVATION AND PRODUCTION
Sec. 501. Miscellaneous amendments to LIHPRHA.
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Sec. 502. Low-income housing preservation authorization of appropriations.
Sec. 503. FHA fund support of section 8 assistance for property disposition.
Sec. 504. HOME Program loan guarantees.
Sec. 505. HOME authorization of appropriations.
Sec. 506. Extension of the section 221(g)(4) auction provisions.
Sec. 507. Extension of the multifamily mortgage credit demonstrations.
TITLE VI—EXPAND FAIR HOUSING
Sec. 601. Metropolitan areawide strategy demonstration.
Sec. 602. Expand use of amounts in section 213(d)(4) headquarters reserve in
connection with settlement of civil rights litigation.
Sec. 603. Making CDBG expenditures on fair housing activities eligible activi-
ties in their own right.
Sec. 604. Fair Housing Initiatives Program authorization of appropriations.
Sec. 605. Civil money penalties for violations of the HOME Mortgage Disclo-
sure Act by nonsupervised mortgagees.
TITLE VII—COMMUNITY DEVELOPMENT AND EMPOWERMENT
Subtitle A—Neighborhood Leveraged Investments for Tomorrow (LIFT)
Program
Sec. 701. Authorization.
Sec. 702. Eligible neighborhoods.
Sec. 703. Eligible activities.
Sec. 704. Grants for neighborhood revitalization projects.
Sec. 705. Competitive grants for neighborhood revitalization projects.
Sec. 706. Records, reports, and audits.
Sec. 707. Training and information activities.
Sec. 708. Definitions.
Subtitle B—Community Viability Fund
Sec. 711. Program authorization.
Sec. 712. Savings provision.
Subtitle C—Colonias Assistance Program
Sec. 721. Authorization.
Sec. 722. Eligible activities.
Sec. 723. Model programs.
Sec. 724. Competitive grants.
Sec. 725. Records, reports, and audits.
Sec. 726. Definitions.
Sec. 727. Extension of Colonia Program under section 916 of the Cranston-
Gonzalez National Affordable Housing Act.
TITLE D—ZONE ECONOMIC DEVELOPMENT INITIATIVE
Sec. 731. Authorization.
Sec. 732. Purpose.
Sec. 733. Eligible activities.
Sec. 734. Allocation of funds.
Sec. 735. Use in conjunction with loan guarantees.
Sec. 736. Records, reports, and audits.
Sec. 737. Funding authorization.
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Subtitle E—Authorizations of Appropriations
Sec. 741. Capacity building for community development and affordable housing.
Sec. 742. Community development block grants.
Sec. 743. Economic development initiative.
TITLE VIII—MANAGEMENT REFORM
Subtitle A—Improve the Allocation and Use of Assistance
Sec. 801. Limit section 8 contract rent adjustments for rents above section 8
existing housing FMRs.
Sec. 802. Provide incentives to refinance high interest mortgages for section 8
projects.
Sec. 803. LMSA reforms.
Sec. 804. Reduce AAF for units where family has not moved since previous
year.
Sec. 805. Preference for working families.
Sec. 806. Use of technical assistance funds by or for HUD staff.
Subtitle B—Office of Public and Indian Housing
Sec. 811. Oversight, technical assistance, emergency action resources, and resi-
dent survey for public housing programs.
Sec. 812. Recapture of development amounts.
Subtitle C—Office of Housing
Sec. 821. Section 235 refinancing.
Sec. 822. Elimination of new activity in low-use FHA multifamily development
programs.
Sec. 823. Indemnification for project managers.
Subtitle D—Office of Community Planning and Development
Sec. 831. Management information systems.
Sec. 832. Use of UDAG recaptures.
Subtitle E—Nonjudicial Foreclosure of Defaulted Single Family Mortgages
Sec. 841. Short title.
Sec. 842. Findings and purpose.
Sec. 843. Definitions.
Sec. 844. Applicability.
Sec. 845. Designation of foreclosure commissioner.
Sec. 846. Prerequisites to foreclosure.
Sec. 847. Notice of foreclosure sale.
Sec. 848. Commencement of foreclosure.
Sec. 849. Service of notice of foreclosure sale.
Sec. 850. Presale reinstatement.
Sec. 851. Conduct of sale; adjournment.
Sec. 852. Foreclosure costs.
Sec. 853. Disposition of sale proceeds.
Sec. 854. Transfer of title and possession.
Sec. 855. Record of foreclosure and sale.
Sec. 856. Effect of sale.
Sec. 857. Computation of time.
Sec. 858. Separability.
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Sec. 859. Deficiency judgment.
TITLE IX—MISCELLANEOUS AMENDMENTS
Sec. 901. OFHEO assessment collection dates.
Sec. 902. Lead-based paint technical assistance amendments.
Sec. 903. Lead-based paint target housing hazard reduction program.
Sec. 904. HUD research and development.
TITLE I—ASSISTANCE FOR THE HOMELESS
Subtitle A—Reorganization of the Stewart B. McKinney
Homeless Assistance Act
SHORT TITLE
SEC. 101. This subtitle may be cited as the ‘‘Stewart
B. McKinney Homeless Housing Assistance Reorganiza-
tion Act of 1994’’.
FINDINGS AND PURPOSES
SEC. 102. (a) FINDINGS.—The Congress finds that—
(1) more Americans are homeless than at any
time since the Great Depression;
(2) homeless populations differ in different
parts of the country and require different types of
systems of varying sophistication to meet the needs
of those populations;
(3) the best approach for addressing this situa-
tion is to focus Federal homeless housing assistance
on a ‘‘continuum of care’’—a seamless process which
moves the homeless from the street into a system
which provides outreach and assessment, emergency
shelter, transitional housing, and permanent hous-
ing;
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(4) the Stewart B. McKinney Homeless Assist-
ance Act created emergency programs to solve spe-
cific homeless problems as they were identified, and
has evolved into an ad hoc approach of separate pro-
grams with separate means of distributing assist-
ance, separate rules, and separate reporting require-
ments, which tax the resources of the Department of
Housing and Urban Development, local govern-
ments, and not-for-profit homeless providers;
(5) the competitive process for distributing as-
sistance under these programs—
(A) restricts the flexibility of communities
to fashion homeless systems that meet the
needs of homeless persons in their areas;
(B) does not ensure that Federal resources
are targeted where the need is;
(C) 
results 
in 
unpredictable 
funding
streams which hinder communities’ ability to
plan, develop, and implement comprehensive
‘‘continuum of care’’ systems to assist homeless
individuals and families; and
(D) impedes the integration and coordina-
tion of the resources—Federal, private, not-for-
profit, and local government—available within a
community; and
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(6) the current array of programs does not en-
sure that a community will have the tools to create
a ‘‘continuum of care’’ to address its homeless
needs.
(b) PURPOSES.—The purposes of this subtitle are
to—
(1) reorganize the McKinney Act homeless
housing assistance authorities, to assist States and
localities to use them more efficiently and effectively
through a comprehensive system involving a ‘‘contin-
uum of care’’ approach designed to meet the shelter,
service, and permanent housing needs of the Na-
tion’s homeless individuals and families;
(2) simplify and make more flexible the provi-
sion of Federal homeless assistance;
(3) encourage the cooperation and participation
of the States and units of general local government,
along with private non-profit organizations, in plan-
ning and implementing comprehensive homeless as-
sistance programs that are designed to meet the
array of service and shelter needs of the homeless
population toward the ultimate goal of assisting indi-
viduals and families to move to permanent housing
and self-sufficiency with supportive services, if nec-
essary, as quickly as possible;
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(4) maximize a community’s ability to imple-
ment a ‘‘continuum of care,’’ by working with local
groups and not-for-profit providers;
(5) assure private non-profit organizations and
community groups that HUD will administer the
grant if States or units of general local government
are reluctant to participate in the program estab-
lished by this subtitle;
(6) make more efficient and equitable the man-
ner in which the Department of Housing and Urban
Development distributes Federal homeless assist-
ance, and to reduce the burden on the Department’s
staff in managing numerous competitions for grants
so that its limited staff can focus on providing tech-
nical support, analysis, and evaluation to better en-
able States, units of general local government, and
non-profit providers to use Federal homeless assist-
ance;
(7) reduce the costs to States, units of general
local government, and private non-profit organiza-
tions in applying for and using the assistance; and
(8) begin the process of moving toward the goal
of meeting the needs of most of the Nation’s home-
less population through the mainstream programs as
the Federal resources supporting these programs be-
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come available, in accordance with the Nation’s Plan
to End Homelessness.
DEFINITIONS
SEC. 103. As used in this subtitle:
(1) The term ‘‘Act’’ means the Stewart B.
McKinney Homeless Assistance Act.
(2) The term ‘‘applicant’’ means a grantee sub-
mitting an application under section 105.
(3) The term ‘‘allocation unit of general local
government’’ means a metropolitan city and an
urban county.
(4) The term ‘‘grantee’’ means—
(A) an allocation unit of general local gov-
ernment, Indian tribe, or Insular Area that ad-
ministers a grant under section 108(a)(1);
(B) an allocation unit of general local gov-
ernment, Indian tribe, or Insular Area that des-
ignates a public agency or a private non-profit
organization (or a consortium of such organiza-
tions) to administer grant amounts instead of
the jurisdiction under section 108(a)(2);
(C) a public agency or a private non-profit
organization (or a consortium of such organiza-
tions) designated by the Secretary under section
108(a)(3) to administer grant amounts instead
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of an allocation unit of general local govern-
ment, Indian tribe, or Insular Area;
(D) an entity receiving grant amounts
from the Secretary under section 108(a)(4);
(E) a State administering a grant under
section 108(b)(1)(A);
(F) a unit of general local government re-
ceiving a grant from the Secretary under sec-
tion 108(b)(5); and
(G) a private nonprofit organization receiv-
ing a grant from the Secretary under section
108(b)(4).
(5) The term ‘‘homeless individual’’ has the
meaning given such term in section 103 of the Act.
(6) The term ‘‘homeless family’’ means a group
of one or more related individuals who are homeless
individuals.
(7) The term ‘‘Indian tribe’’ means any Indian
tribe, band, group, and nation, including Alaska In-
dians, Aleuts, and Eskimos, and any Alaskan Native
Village, of the United States, which is considered an
eligible recipient under the Indian Self-Determina-
tion and Education Assistance Act (Public Law 93–
638) or was considered an eligible recipient under
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chapter 67 of title 31, United States Code, before
the repeal of such chapter.
(8) The term ‘‘Insular Area’’ means the Virgin
Islands, Guam, American Samoa, and the Northern
Mariana Islands.
(9) The term ‘‘metropolitan city’’ has the mean-
ing given the term in section 102(a)(4) of the Hous-
ing and Community Development Act of 1974.
(10) The term ‘‘private non-profit 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 has a voluntary board;
(C) that has an accounting system, or has
designated a fiscal agent in accordance with re-
quirements established by the Secretary; and
(D) that practices nondiscrimination in the
provision of assistance.
(11) The term ‘‘recipient’’ means a grantee
(other than a State distributing grant amounts to
State recipients) and a State recipient.
(12) The term ‘‘Secretary’’ means the Secretary
of Housing and Urban Development.
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(13) The term ‘‘State’’ means each of the sev-
eral States and the Commonwealth of Puerto Rico.
(14) The term ‘‘State recipient’’ means—
(A) a unit of general local government
within the State (other than an allocation unit
of general local government) that receives grant
amounts 
from 
the 
State 
under 
section
108(b)(3); and
(B) a private non-profit organization re-
ceiving grant amounts from the State under
section 108(b)(4).
(15) The term ‘‘unit of general local govern-
ment’’ means—
(A) a city, town, township, county, parish,
village, or other general purpose political sub-
division of a State;
(B) the District of Columbia; and
(C) any agency or instrumentality thereof
that is established pursuant to legislation and
designated by the chief executive to act on be-
half of the jurisdiction with regard to provisions
of this subtitle.
The term includes a consortium of geographically
contiguous units of general local government if the
Secretary determines that the consortium—
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(i) has sufficient authority and administra-
tive capability to carry out the purposes of this
subtitle on behalf of its member jurisdictions;
and
(ii) will, according to a written certification
by the State (or States, if the consortium in-
cludes jurisdictions in more than one State), di-
rect its activities to alleviation of problems of
homeless individuals or families within the
State or States.
(16) The term ‘‘urban county’’ has the meaning
given the term in section 102(a)(6) of the Housing
and Community Development Act of 1974.
AUTHORIZATIONS
SEC. 104. (a) IN GENERAL.—The Secretary is au-
thorized to make grants, in accordance with the provisions
of this subtitle, to grantees to carry out activities to assist
homeless individuals and families in support of com-
prehensive homeless assistance systems.
(b) FUNDING AMOUNTS.—For purposes of this sub-
title, there are authorized to appropriated $1,020,000,000
for fiscal year 1995, and such sums as may be necessary
for each of fiscal years 1996 and 1997. Any amounts ap-
propriated shall remain available until expended.
(c) AWARDING OF GRANTS.—
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(C) The criteria for awarding grants re-
ferred to in subparagraph (B) shall include—
(i) the extent to which there is a need
for assistance for homeless individuals and
families in the jurisdiction;
(ii) the extent to which the proposed
activities further the establishment and
maintenance of the comprehensive home-
less assistance system referred to in sec-
tion 105(b)(1)(C);
(iii) the extent to which private non-
profit organizations providing assistance to
homeless individuals and families in the ju-
risdiction have been and will be, included
in planning for the receipt of assistance
under this subtitle, the development of the
application under section 105, and the exe-
cution of the proposed activities;
(iv) the extent to which homeless indi-
viduals and families will proceed with ap-
propriate expedition through the com-
prehensive homeless assistance system and
into permanent housing; and
(v) such other criteria as the Sec-
retary deems appropriate to further the
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purposes of this paragraph and this sub-
title.
(D) The Secretary is authorized to set
aside such amounts as the Secretary deems ap-
propriate for grants under this paragraph for
Indian tribes and Insular Areas.
APPLICATION
SEC. 105. (a) IN GENERAL.—Each applicant shall
submit an application in such form and in accordance with
such procedures as the Secretary shall establish.
(b) 
MINIMUM
REQUIREMENTS.—An 
application
under this section shall at a minimum—
(1) on the basis of information provided in the
current comprehensive affordable housing strategy
for the appropriate jurisdiction under section 105 of
the Cranston-Gonzalez National Affordable Housing
Act, or such other plan as the Secretary may pre-
scribe, set forth for the jurisdiction—
(A) a detailed description of the current
population of homeless individuals and families;
(B) the current facilities and services de-
signed to assist that population; and
(C) the comprehensive homeless assistance
system to be established and maintained within
the jurisdiction (a ‘‘continuum of care’’), which
shall include at a minimum—
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(i) a system of outreach and assess-
ment for—
(I) determining whether an indi-
vidual or family is homeless, needs as-
sistance to avoid becoming homeless,
or needs other assistance; and
(II) ensuring that individuals and
families that are so identified receive
appropriate housing and supportive
services (which may include services
with respect to health, mental health,
substance abuse, family support, edu-
cation, and child care, and services di-
rected toward obtaining appropriate
income support, including employment
training);
(ii) the availability of emergency shel-
ters with appropriate supportive services to
ensure that homeless individuals and fami-
lies for which such housing is appropriate
receive adequate shelter, including during
the period in which the assessment re-
ferred to in clause (i) is being performed;
(iii) the availability of transitional
housing with appropriate supportive serv-
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ices to ensure that homeless individuals
and families for which such housing is ap-
propriate are prepared for increased re-
sponsibility and permanent housing, or
permanent supportive housing, after the
transition period;
(iv) the availability of permanent
housing, or permanent supportive housing,
adequate to meet the long-term housing
needs of all homeless individuals and fami-
lies; and
(v) linkages between assistance pro-
vided under this subtitle and assistance
provided under other Federal, State, and
local programs that may be used to assist
homeless individuals and families, such
as—
(I) assistance under the Public
and Indian Housing and section 8
programs under the United States
Housing Act of 1937, the Home In-
vestment Partnerships Act, and the
community development block grant
program under title I of the Housing
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and Community Development Act of
1974;
(II) programs administered by
the Secretary of Labor;
(III) health, social service, and
income support services;
(IV) programs designed to assist
homeless veterans;
(V) adult education, employment
training, and education for homeless
children and youth; and
(VI) national service;
(2) provide an assessment of what is required
to establish and maintain the comprehensive system
referred to in paragraph (1)(C);
(3) set forth a multi-year strategy for establish-
ing and maintaining the system, including appro-
priate timetables, milestones, and budget estimates
for accomplishing each element of the strategy;
(4) set forth a 1-year action plan, identifying all
activities to be carried out with assistance under this
subtitle and demonstrating how these activities will
further the strategy referred to in paragraph (3);
(5) describe the means the applicant (other
than a State distributing grant amounts to State re-
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cipients under section 108(b)(2)) will use to distrib-
ute grant amounts to subgrantees, including whether
such amounts will be awarded on a competitive or
non-competitive basis;
(6) demonstrate that the local board referred to
in section 109(b) has signed the application;
(7) contain certifications or other such forms of
proof of commitments of financial and other re-
sources from each public agency or private non-prof-
it organization that has a role in establishing and
maintaining the comprehensive homeless assistance
system;
(8) contain assurances satisfactory to the Sec-
retary that activities carried out under section 106
will meet the requirements of the Act, as provided
in section 106(b);
(9) in the case of States distributing grant
amounts to State recipients, describe the method of
distribution;
(10) except for grant amounts that States will
distribute to State recipients, contain a certification
from the public official responsible for submitting
the comprehensive housing affordability strategy
under section 105 of the Cranston-Gonzalez Na-
tional Affordable Housing Act for the State or unit
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of general local government within which the project
is located that the proposed project is consistent
with the approved housing strategy of such State or
unit of general local government;
(11) contain a certification that the applicant
will comply with the requirements of the Fair Hous-
ing Act, title VI of the Civil Rights Act of 1964, sec-
tion 504 of the Rehabilitation Act of 1973, and the
Age Discrimination Act of 1975, and will affirma-
tively further fair housing; and
(12) contain a certification that the applicant
will comply with the requirements of this subtitle
and other applicable laws.
ELIGIBLE ACTIVITIES
SEC. 106. (a) IN GENERAL.—Recipients may only
carry out the following activities with grant amounts
under this subtitle:
(1) Activities eligible for assistance under the
following provisions of the Act—
(A) emergency shelters under subtitle B of
title IV;
(B) transitional housing under subtitle C
of title IV;
(C) safe havens under subtitle D of title
IV;
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(D) single room occupancy dwellings under
section 441;
(E) shelter plus care under subtitle F of
title IV; and
(F) rural homeless housing assistance
under subtitle G of title IV;
(2) Permanent housing meeting such require-
ments as the Secretary shall prescribe.
(3)(A) For the first year in which a recipient
receives grant amounts under this subtitle, adminis-
trative expenses in connection with planning the de-
velopment of, and establishing, its program under
this subtitle;
(B) in subsequent years, defraying the cost of
administering the program; and
(C) in all years, defraying the cost of constitut-
ing and operating the local board referred to in sec-
tion 109(b); except that not more than 5 percent of
any amounts provided to a recipient under this sub-
title for a fiscal year may be used for activities
under this paragraph.
(4) Building the capacity of private non-profit
organizations to participate in the comprehensive
homeless assistance system of the recipient, except
that not more than 2 percent of any amounts pro-
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vided to a recipient under this subtitle for a fiscal
year may be used for activities under this para-
graph.
(b) PROGRAM REQUIREMENTS.—Activities assisted
under this subtitle shall comply with all applicable require-
ments of the Act, except those that the Secretary deter-
mines are inconsistent with the provisions or purposes of
this subtitle.
(c) MATCHING FUNDING.—
(1) IN GENERAL.—Each recipient shall ensure
that contributions totaling not less than 25 percent
of the grant amounts made available to the recipient
for any fiscal year under this subtitle shall be pro-
vided from non-Federal sources, as defined by the
Secretary, to carry out the homeless assistance pro-
gram of the recipient. Each recipient shall certify to
the Secretary that it has complied with this section,
and shall include with the certification a description
of the sources and amounts of the matching funds.
(2) WAIVERS.—A recipient may request that
the Secretary reduce or waive the matching require-
ment of paragraph (1). The request shall be in a
form and manner prescribed by the Secretary, and
shall demonstrate that the recipient lacks the fi-
nances and other resources to meet the requirement.
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The Secretary may grant the request, if the Sec-
retary determines that imposition of the match—
(A) would create a significant hardship for
the recipient; and
(B) would thwart the overall purpose of
the homeless assistance program of the recipi-
ent.
(3) CALCULATION OF AMOUNTS.—In calculat-
ing the amount of matching funds required under
paragraph (1), a recipient may include—
(A) any funds derived from a non-Federal
source;
(B) the value of any lease on a building;
(C) any salary paid to staff to carry out
the program of the recipient;
(D) the value of the time and services con-
tributed by volunteers, at a rate determined by
the Secretary; and
(E) the proceeds from bond financing val-
idly issued by a State or local government,
agency, or instrumentality thereof, or political
subdivision thereof, and repayable with revenues
derived from a project assisted under this sub-
title, but not more than 25 percent of the con-
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tribution required under paragraph (1) may be
derived from this source.
(d) LIMITATION ON USE OF FUNDS.—No assistance
received under this subtitle (or any State or local govern-
ment funds used to supplement such assistance) may be
used to replace other funds previously used, or designated
for use, by the State, unit of general local government,
Indian tribe, or Insular Area to assist homeless individuals
and families.
(e) NON-PROFIT HOMELESS PROVIDERS.—Each re-
cipient shall make available at least 51 percent of the
grant amounts it receives for any fiscal year to private
non-profit organizations that provide assistance to home-
less individuals and families to carry out activities under
this subtitle. Such organizations shall meet such minimum
standards as the Secretary deems appropriate.
(f) ADMINISTRATIVE EXPENSES FOR CERTAIN ENTI-
TIES.—An allocation unit of general local government, In-
dian tribe, or Insular Area, or a State recipient, that des-
ignates a public agency or a private non-profit organiza-
tion 
(as 
provided 
by 
sections 
108(a)(2) 
and
(b)(3)(A)(i)(II), respectively), or a State recipient that en-
ters into an agreement with a State (as provided by sec-
tion 108(b)(3)(A)(i)(III)), shall make available, to defray
the administrative expenses of the designee or the State,
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such sums as the Secretary deems appropriate from
amounts eligible for this purpose under subsection (a)(2).
ALLOCATION AND DISTRIBUTION OF FUNDS
SEC. 107. (a) INSULAR AREAS.—For each fiscal year,
the Secretary shall allocate assistance under this subtitle
to Insular Areas in accordance with an allocation formula
established by the Secretary.
(b) STATES AND ALLOCATION UNITS OF GENERAL
LOCAL GOVERNMENT.—
(1) FORMULA ALLOCATION.—
(A) For each fiscal year, of the amounts
that remain after amounts are reserved for In-
sular Areas under subsection (a), the Secretary
shall allocate assistance according to the for-
mula described in subparagraph (B) or such
other formula as may hereafter be enacted into
law.
(B)(i) 
The 
Secretary 
shall 
allocate
amounts for allocation units of general local
government and States, and for Indian tribes,
in a manner that ensures that the percentage of
the total amount available under this subtitle
for any fiscal year that is allocated for any
State or allocation unit of general local govern-
ment, or for Indian tribes, is equal to the per-
centage of the total amount available for section
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equals 75 percent of the amounts appropriated
under this subtitle for each year.
(II) All amounts allocated pursuant to the
preceding clauses for States shall be decreased
on a pro rata basis until the aggregate of such
amounts equals 25 percent of the amounts ap-
propriated under this subtitle for each year.
(2) DETERMINATION OF GRANT AMOUNT FOR
STATES
AND
ALLOCATION
UNITS
OF
GENERAL
LOCAL GOVERNMENT.—The formula amount deter-
mined for an allocation unit of general local govern-
ment or a State, under paragraph (1) shall be the
maximum amount that the jurisdiction is eligible to
receive. The Secretary may provide a grant for a
State or for an allocation unit of general local gov-
ernment for an amount less than the formula
amount, if the Secretary determines that such action
is appropriate based upon review of the application
under section 105 or as a result of the annual per-
formance review and audit under section 110.
(c) REALLOCATIONS.—Any amounts that a State or
an allocation unit of general local government is eligible
to receive under subsection (b) that are not received for
use in the jurisdiction, as provided by sections 108 (a)
and (b), or that become available as a result of actions
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under section 110(b), shall be added to amounts available
for allocation under section 107 for the succeeding fiscal
year.
ADMINISTRATION OF PROGRAM
SEC. 108. (a) ALLOCATION UNITS
OF GENERAL
LOCAL GOVERNMENT, INDIAN TRIBES, AND INSULAR
AREAS.—
(1) IN GENERAL.—Except as provided in para-
graphs (2), (3), and (4), an allocation unit of gen-
eral local government, Indian tribe, or Insular Area
shall administer grant amounts received under sec-
tion 107 for any fiscal year.
(2) 
AGENCIES
AND
ORGANIZATIONS
DES-
IGNATED BY JURISDICTION.—
(A) An allocation unit of general local gov-
ernment, Indian tribe, or Insular Area may
elect for any fiscal year to designate a public
agency or a private non-profit organization (or
a consortium of such organizations) to admin-
ister grant amounts under section 107 instead
of the jurisdiction.
(B) The Secretary shall prescribe the man-
ner and time for making an election under sub-
paragraph (A), and shall establish criteria for
the approval of agencies and organizations,
which shall include demonstrated experience of
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the entity in providing assistance to homeless
individuals and families in the jurisdiction.
(C) The allocation unit of general local
government, Indian tribe, or Insular Area shall
remain both the grantee and the recipient for
purposes of this subtitle. The Secretary may, at
the request of the jurisdiction, provide grant
amounts directly to the agency or organization
designated under this paragraph.
(3) 
AGENCIES
AND
ORGANIZATIONS
DES-
IGNATED BY HUD.—If an allocation unit of general
local government, Indian tribe, or Insular Area, or
(if appropriate) a public agency or private non-profit
organization designated by the jurisdiction under
paragraph (2), does not receive a grant under sec-
tion 107 for any fiscal year because of failure to
meet the application requirements of section 105,
the Secretary is authorized to designate an agency
or organization meeting the approval criteria re-
ferred to in paragraph (2). Any agency or organiza-
tion so designated shall be both the grantee and re-
cipient for purposes of this subtitle.
(4) ADMINISTRATION OF GRANT BY HUD.—If
for any fiscal year the Secretary determines that
amounts allocated for an allocation unit of general
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local government, Indian tribe, or Insular Area will
not be used in the jurisdiction, as provided by the
preceding provisions of this subsection, the Secretary
is authorized to administer such amounts instead of
the jurisdiction. The Secretary shall prescribe such
procedures and requirements as the Secretary deems
appropriate for administering grant amounts under
this paragraph.
(b) STATES.—
(1) IN GENERAL.—States shall elect—
(A) to administer grant amounts received
under section 107, as provided by paragraphs
(2) and (3); or
(B) to have the Secretary administer these
amounts instead of the State, as provided by
paragraph (5).
If a State elects to administer grant amounts under
subparagraph (A), the election shall be permanent
and final.
(2) STATE PROGRAM.—Of amounts referred to
in paragraph (1)(A), the State—
(A) may use up to 15 percent to carry out
its own homeless assistance program under this
subtitle, except that these amounts may only be
used 
for 
eligible 
activities 
under 
section
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106(a)(1) for which States are eligible recipi-
ents under the Act; and
(B) shall distribute the remaining amounts
to State recipients for use under this subtitle.
Grants to States may only be used to carry out ac-
tivities in areas of the State outside allocation units
of general local government.
(3) DISTRIBUTION OF AMOUNTS TO STATE RE-
CIPIENTS.—
(A)(i) A State distributing amounts to
State recipients under paragraph (1)(A) shall,
for each fiscal year, afford each such recipient
the options of—
(I) administering the grant amounts
on its own behalf;
(II) designating a public agency or a
private non-profit organization (as pro-
vided by subsection (a)(2)) to administer
the grant amounts instead of the jurisdic-
tion; or
(III) entering into an agreement with
the State, in consultation with private non-
profit organizations providing assistance to
homeless individuals and families in the ju-
risdiction, under which the State will ad-
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minister the grant amounts instead of the
jurisdiction.
These options shall be exercised at such time
and in accordance with such criteria as the Sec-
retary may prescribe.
(ii) A State recipient designating an agen-
cy or organization as provided by clause (i)(II),
or entering into an agreement with the State
under clause (i)(III), shall remain the recipient
for purposes of this subtitle. The State may, at
the request of the State recipient, provide grant
amounts directly to the agency or organization
designated under clause (i)(II).
(B) The State shall distribute amounts to
State recipients (or to agencies or organizations
designated under subparagraph (A)(i)(II), as
appropriate) on the basis of an application con-
taining such information as the Secretary may
prescribe. Each application shall evidence an in-
tent to establish a comprehensive homeless as-
sistance system, except that the State may
waive this requirement with respect to one or
more proposed activities, where the State deter-
mines that—
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(i) the activities are necessary to meet
the needs of homeless individuals and fam-
ilies within the jurisdiction; and
(ii) a comprehensive homeless assist-
ance system is not necessary, due to the
nature and extent of homelessness in the
jurisdiction.
(C) In selecting State recipients and mak-
ing awards under subparagraph (B), the State
shall give preference to applications (in accord-
ance with criteria prescribed by the Secretary)
that demonstrate higher relative levels of home-
less need and fiscal distress.
(D) Each State distributing grant amounts
to State recipients under paragraph (2)(B) may
retain not to exceed 5 percent of the amount to
be used for this purpose to defray the cost of
carrying out its responsibilities under this sub-
title.
(4) STATE
OR
HUD
ADMINISTRATION
OF
GRANTS FOR INDIVIDUAL STATE RECIPIENTS.—If in
any fiscal year a State distributes grant amounts to
a State recipient, but the recipient fails to receive
the amounts pursuant to paragraph (3)(A)(i), the
Secretary or the State, as the Secretary may pro-
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vide, may distribute the amounts to private non-
profit organizations in the jurisdiction. If the Sec-
retary distributes the amounts, the Secretary shall
deduct the amounts distributed from the grant pro-
vided to the State for that fiscal year.
(5) HUD ADMINISTRATION
OF
STATE
PRO-
GRAM.—If a State elects to have the Secretary ad-
minister its grant amounts under section 107, as
provided by paragraph (1), the Secretary is author-
ized to distribute grant amounts to State recipients
instead of the State, in accordance with require-
ments and procedures prescribed by the Secretary.
The Secretary shall establish criteria for selecting
recipients and making awards under this paragraph,
which shall include giving preference to applications
that demonstrate higher relative levels of homeless
need and fiscal distress.
CITIZEN PARTICIPATION
SEC. 109. (a) IN GENERAL.—Each recipient shall en-
sure that citizens, and appropriate private non-profit orga-
nizations and other interested groups and entities, partici-
pate fully in the development and carrying out of the pro-
gram authorized under this subtitle. The Secretary shall
prescribe such requirements to carry out this section as
the Secretary deems appropriate, which shall include re-
quirements applicable to the local boards referred to in
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subsection (b) and the citizen participation provisions of
subsection (c), and the timing of, and sequence for, carry-
ing out the requirements of those subsections.
(b) LOCAL BOARDS.—
(1) ESTABLISHMENT
AND
FUNCTION.—Each
recipient shall establish and support a local board,
which shall assist the recipient in—
(A) determining whether the grant should
be administered by the recipient, a public agen-
cy or private non-profit organization, or the
State or the Secretary, as appropriate, under
sections 108 (a) and (b);
(B) developing the application under sec-
tion 105;
(C) overseeing the activities carried out
with assistance under this subtitle; and
(D) evaluating the performance of the re-
cipient in carrying out these activities.
(2) COMPOSITION OF BOARD.—The local board
shall consist of—
(A) at least one member representing each
of the following groups—
(i) homeless individuals and families;
(ii) homeless advocates;
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(iii) individuals and entities providing
assistance to homeless individuals and
families;
(iv) the business community; and
(v) neighborhood advocates;
(B) in the case of a recipient that is a
State, one member representing the State agen-
cy or instrumentality dealing with mental
health;
(C) not more than one member represent-
ing the recipient; and
(D) such other individuals and entities as
the Secretary shall prescribe.
(3) DISTRIBUTION OF MEMBERSHIP.—At least
51 percent of the membership of the board shall
have been nominated by individuals and entities
other than a governmental jurisdiction.
(4) BOARD SIGN-OFF.—
(A) No applicant may submit an applica-
tion to the Secretary under section 105, and no
grantee may submit to the Secretary a perform-
ance report under subsection 110(a), unless the
board signs the document.
(B) No State recipient may submit an ap-
plication under section 108(b)(3) or a perform-
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ance report to a State, unless the board signs
the document.
(5) REVIEW BY SECRETARY.—If the board or
other members of the community believe that the
process for constituting or operating the board is
unfair, they may ask the Secretary to review the
matter. The Secretary shall attempt to resolve the
problem and where the Secretary finds that the
process is unfair, the Secretary may disapprove an
application under section 105 or refuse to accept a
performance report under section 110(a).
(6) CONFLICTS OF INTEREST.—The Secretary
shall prescribe standards governing potential con-
flicts of interest under which members of local
boards may participate in activities carried out
under this subtitle.
(c) INVOLVEMENT OF CITIZENS AND OTHERS.—
(1) IN GENERAL.—Each recipient shall—
(A) make available to its citizens, public
agencies, and other interested parties informa-
tion concerning the amount of assistance the ju-
risdiction expects to receive and the range of
activities that may be undertaken with the as-
sistance;
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(B) publish the proposed application in a
manner that, in the determination of the Sec-
retary, affords affected citizens, public agencies,
and other interested parties a reasonable oppor-
tunity to examine its content and to submit
comments on it;
(C) hold one or more public hearings to ob-
tain the views of citizens, public agencies, and
other interested parties on the housing needs of
the jurisdiction; and
(D) provide citizens, public agencies, and
other interested parties with reasonable access
to records regarding any uses of any assistance
the recipient may have received during the pre-
ceding 5 years.
(2) NOTICE AND COMMENT.—Before submitting
any performance report under section 110(a) or sub-
stantial amendment to an application under section
105, a recipient shall provide citizens with reason-
able notice of, and opportunity to comment on, such
performance report or application before its submis-
sion.
(3) CONSIDERATION OF COMMENTS.—A recipi-
ent shall consider any comments or views of citizens
in preparing a final application, amendment to an
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application or performance report for submission. A
summary of such comments or views shall be at-
tached when an application, amendment to an appli-
cation, or performance report is submitted. The sub-
mitted application, amendment, or report shall be
made available to the public.
(4) AUTHORITY
OF
SECRETARY.—The Sec-
retary shall establish procedures appropriate and
practicable for providing a fair hearing and timely
resolution of citizen complaints related to applica-
tions or performance reports under this subtitle.
(d) REQUIREMENTS
FOR
THE
SECRETARY
AND
STATES DISTRIBUTING AMOUNTS
TO STATE RECIPI-
ENTS.—
(1) IN GENERAL.—The Secretary may prescribe
citizen participation requirements comparable (to the
extent appropriate) to those contained in the preced-
ing provisions of this section where—
(A) a State is distributing grant amounts
to State recipients, as provided by sections
108(b)(2);
(B) the Secretary is administering the
grant amounts of an allocation unit of general
local government, as provided by section
108(a)(4); and
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(C) the Secretary is distributing grant
amounts, to recipients, as provided by section
18(b)(3), (4), or (5).
(2) LAWS INAPPLICABLE.—The following provi-
sions of law shall not apply with respect to the ac-
tions of the Secretary referred to in paragraph (1)—
(A) the Federal Advisory Committee Act;
and
(B) section 103 of the Department of
Housing and Urban Development Reform Act
of 1989.
The Secretary shall establish appropriate standards
under this paragraph to ensure the integrity of the
process for awarding assistance.
REPORTS, REVIEWS, AND AUDITS
SEC. 110. (a) GRANTEE PREFERENCE REPORT.—
Each grantee shall submit to the Secretary a performance
and evaluation report concerning the use of funds made
available under this subtitle. The report shall be submitted
at such time and contain such information as the Sec-
retary shall prescribe, and shall be made available to the
local boards referred to in section 109(b) and to citizens,
public agencies, and other interested parties in the juris-
diction of the grantee in sufficient time to permit the
board and the citizens, public agencies, and other inter-
ested parties to comment on the report before its submis-
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sion. Each grantee performance report shall be signed by
the local board.
(b) REVIEWS AND AUDITS.—The Secretary shall, at
least on an annual basis, make such reviews and audits
as may be necessary or appropriate to determine—
(1) in the case of a grantee (other than a
grantee referred to in paragraph (2)), whether the
grantee—
(A) has carried out its activities in a timely
manner;
(B) has made progress toward establishing
and maintaining the comprehensive homeless
assistance system (‘‘continum of care’’) in con-
formity with its application under this subtitle;
(C) has carried out its activities and cer-
tifications in accordance with the requirements
of this subtitle and other applicable laws; and
(D) has a continuing capacity to carry out
its activities in a timely manner; and
(2) in the case of States distributing grant
amounts to State recipients, whether the State—
(A) has distributed amounts to State re-
cipients in a timely manner and in conformance
with the method of distribution described in its
application;
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(B) has carried out its activities and cer-
tifications in compliance with the requirements
of this subtitle and other applicable laws; and
(C) has made such reviews and audits of
the State recipients as may be necessary or ap-
propriate to determine whether they have satis-
fied the applicable performance criteria con-
tained in paragraph (1).
The Secretary may make appropriate adjustments in the
amount of grants in accordance with the Secretary’s find-
ings under this subsection. With respect to assistance
made available for State recipients, the Secretary may ad-
just, reduce, or withdraw such assistance, or take other
action as appropriate in accordance with the Secretary’s
reviews and audits under this subsection, except that
funds already properly expended on eligible activities
under this subtitle shall not be recaptured or deducted
from future assistance to such recipients.
NONDISCRIMINATION IN PROGRAMS AND ACTIVITIES
SEC. 111. (a) IN GENERAL.—No person in the Unit-
ed States shall on the ground of race, color, national ori-
gin, religion, or sex be excluded from participation in, be
denied the benefits of, or be subjected to discrimination
under any program or activity funded in whole or in part
with funds made available under this subtitle. Any prohibi-
tion against discrimination on the basis of age under the
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Age Discrimination Act of 1975 or with respect to an oth-
erwise qualified handicapped individual, as provided in
section 504 of the Rehabilitation Act of 1973, shall also
apply to any such program or activity.
(b) LIMITATIONS.—
(1) INDIAN TRIBES.—No grant may be made to
an Indian tribe under this subtitle unless the appli-
cant provides satisfactory assurances that its pro-
gram will be conducted and administered in con-
formity with title II of Public Law 90–284. The Sec-
retary may waive, in connection with grants to In-
dian tribes, the provisions of subsection (a).
(2) HAWAIIAN HOME LANDS.—Nothing in this
subtitle relating to discrimination on the basis of
race shall apply to the provision of assistance to the
Hawaiian Home Lands.
CONSULTATION
SEC. 112. In carrying out the provisions of this sub-
title, including the issuance of regulations, the Secretary
shall consult with other Federal departments and agencies
administering programs affecting homeless individuals
and families.
RECORDS, REPORTS, AND AUDITS
SEC. 113. (a) KEEPING OF RECORDS.—Any recipient
(including a State distributing grant amounts to State re-
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cipients under section 108(b)(2)(B)) shall keep such
records as may be reasonably necessary—
(1) to disclose the amounts and the disposition
of the grant amounts; and
(2) to ensure compliance with the requirements
of this subtitle.
(b) ACCESS TO DOCUMENTS BY THE SECRETARY.—
The Secretary shall have access for the purpose of audit
and examination to any books, documents, papers, and
records of any recipient specified in subsection (a) that
are pertinent to grant amounts received in connection
with, and the requirements of, this subtitle.
(c) ACCESS TO DOCUMENTS BY THE COMPTROLLER
GENERAL.—The Comptroller General of the United
States, or any of the duly authorized representatives of
the Comptroller General, shall have access for the purpose
of audit and examination to any books, documents, papers,
and records of any recipient specified in subsection (a)
that are pertinent to grant amounts received in connection
with, and the requirements of, this subtitle.
REPORTS TO CONGRESS
SEC. 114. The Secretary shall submit a report to the
Congress annually, summarizing the activities carried out
under this subtitle and setting forth the findings, conclu-
sions, and recommendations of the Secretary as a result
of the activities. The report shall be submitted not later
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than 4 months after the end of each fiscal year (except
that, in the case of fiscal year 1995, the report shall be
submitted not later than 6 months after the end of the
fiscal year).
INNOVATIVE HOMELESS PROGRAM
SEC. 115. (a) FUNDING AUTHORIZATION.—Section
2(f) of the HUD Demonstration Act of 1993 is amended
to read as follows:
‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) IN GENERAL.—There are authorized to be
appropriated to carry out this section $100,000,000
for fiscal year 1995 and such sums as may be nec-
essary for fiscal year 1996.
‘‘(2) USE OF AMOUNTS.—All amounts appro-
priated under paragraph (1) shall be used only to
carry out the comprehensive homeless initiative
under subsection (c).’’.
(b) REPEAL.—Section 2(g) of such Act is amended
by striking ‘‘1994’’ and inserting ‘‘1997’’.
Subtitle B—Emergency Food and Shelter
TRANSFER OF THE EMERGENCY FOOD AND SHELTER
PROGRAM FROM FEMA TO HUD
SEC. 121. (a) Section 301 of the Stewart B. McKin-
ney Homeless Assistance Act is amended—
(1) by striking the second sentence of sub-
section (a);
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(2) by striking the first and second sentences of
subsection (b) and inserting in lieu thereof the fol-
lowing: ‘‘The National Board shall consist of the
Secretary and six members. The Secretary shall ap-
point members to vacancies on the National Board
existing on, or occurring after, the effective date of
this sentence.’’;
(3) in subsection (c), by striking ‘‘Director’’
and inserting in lieu thereof ‘‘Secretary’’; and
(4) by striking subsection (e).
(b) Section 303 of such Act is amended—
(1) by striking ‘‘FEDERAL
EMERGENCY
MAN-
AGEMENT AGENCY’’ in the section heading and sub-
section (b)(1) and inserting in lieu thereof ‘‘DEPART-
MENT
OF
HOUSING
AND
URBAN
DEVELOPMENT’’;
and
(2) by striking ‘‘Director’’ each place it appears
and inserting in lieu thereof ‘‘Secretary’’.
(c) Section 311 of such Act is amended by striking
‘‘DIRECTOR’’ in the section heading and in the first sen-
tence and inserting in lieu thereof ‘‘SECRETARY’’.
(d) Section 321(l) of such Act is amended to read
as follows:
‘‘(l) The term ‘Secretary’ means the Secretary
of Housing and Urban Development.’’.
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(e) Section 322 of such Act is amended to read as
follows:
‘‘SEC. 322. AUTHORIZATION OF APPROPRIATIONS.
‘‘There are authorized to be appropriated to carry out
this title $130,000,000 for fiscal year 1995 and
$130,000,000 for fiscal year 1996.’’.
(f) The amendments made by the preceding provi-
sions of this section shall become effective on the later of
October 1, 1994, or the date of enactment of this Act.
TITLE II—PUBLIC AND INDIAN HOUSING;
CROSS-CUTTING AUTHORIZATIONS
Subtitle A—Enhance Flexibility for Public Housing
Agencies
DIRECT LOANS FOR MODERNIZATION AND REPLACEMENT
SEC. 201. The United States Housing Act of 1937
is amended by adding the following new section at the end
of title I:
‘‘SEC. 27. DIRECT LOANS FOR MODERNIZATION AND RE-
PLACEMENT.
‘‘(a) GENERAL AUTHORIZATION.—The Secretary is
authorized, upon such terms and conditions as the Sec-
retary may prescribe, to make loans to public housing
agencies eligible for comprehensive modernization grants
under section 14 for purposes of financing activities eligi-
ble for comprehensive modernization grants under that
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section, except for upgrading the management and oper-
ation of low-rent public housing projects.
‘‘(b) TERMS AND CONDITIONS.—
‘‘(1) CRITERIA FOR APPROVAL.—In determining
whether, or in what amount, to approve an applica-
tion for a loan under this section, the Secretary may
consider—
‘‘(A) the ability of the agency to use funds
effectively, directly or through contract manage-
ment;
‘‘(B) the adequacy of remaining future al-
locations in providing repairs, replacements,
and improvements which will be needed as a re-
sult of usage and depreciation of existing
projects over the loan period; and
‘‘(C) such other criteria as the Secretary
may specify.
‘‘(2) SPECIAL
CONDITIONS.—Notwithstanding
paragraph (1), the Secretary may approve a loan
under this section only if the Secretary determines
that the public housing agency has an acceptable
rate of obligation of funds under section 14, or the
public housing agency agrees to administer the loan
proceeds through contract management.
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‘‘(3) LIMITATIONS ON DENIAL.—The Secretary
may not deny a loan under this section on the basis
of the proposed repayment period for the loan, un-
less the period is more than 10 years or the Sec-
retary determines that the period otherwise causes
the loan to constitute an unacceptable financial risk.
‘‘(4) TERM OF LOAN.—Loans under this section
shall be for a term not to exceed 10 years.
‘‘(5) INTEREST RATE.—Loans under this sec-
tion shall bear an interest rate determined by the
Secretary of the Treasury, taking into consideration
the current market yields on outstanding marketable
obligations of the United States with remaining
terms to maturities comparable to the average matu-
rities of loans under this section, plus amounts suffi-
cient to cover servicing costs.
‘‘(6) PROHIBITION AGAINST SUBORDINATION.—
Loans under this section shall not be subordinated
to other debt contracted by the public housing agen-
cy or to any other claim against the agency.
‘‘(7) SUBSIDY AMOUNT.—Based on the strength
of the guarantees by the State or unit of general
local government, pledges of financial assets, tax
revenues, and payments from other sources (non-
Federal or Federal), and the public housing agency’s
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pledged sources of repayments (including rents and
other anticipated income streams (Federal or non-
Federal)), the Secretary shall establish a subsidy
cost, as defined by the Federal Credit Reform Act
of 1990, for each loan to an agency. The subsidy
shall be calculated by the Office of Management and
Budget in consultation with the Secretary, as di-
rected by section 503(a) of the Federal Credit Re-
form Act, consistent with the technical assumptions
contained in the President’s Budget to assure that
it is fully offset by the premium amount and that
the resulting net subsidy cost to the Federal Govern-
ment is zero.
‘‘(8) PREMIUM AMOUNT.—A premium amount
shall be assessed to cover the subsidy amount associ-
ated with each loan. This premium shall be paid
from the amount the public housing agency received
under the comprehensive grant program under sec-
tion 14 in the year the loan is originated.
‘‘(c) FUNDING AND BORROWING AUTHORIZATION.—
There are authorized to be appropriated such sums as may
be necessary for each of fiscal years 1995 and 1996 for
the cost to the government, as defined in section 502 of
the Congressional Budget Act, of loans under this section.
To the extent provided in appropriation Acts, the Sec-
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retary may enter into commitments to make loans under
this section with an aggregate principal amount of
$2,000,000,000 for fiscal year 1995 and $2,000,000,000
for fiscal year 1996.
‘‘(d) LOAN LIMIT.—No loan may be made under this
section if the total outstanding loans under this section
made to a public housing agency (excluding any amount
repaid) would thereby exceed an amount prescribed by the
Secretary, but not to exceed 5 times the amount of the
public housing agency’s latest comprehensive moderniza-
tion grant under section 14.
‘‘(e) USE OF COMPREHENSIVE GRANTS.—Notwith-
standing any other provision of this title, comprehensive
modernization grants or allocations under this title to the
public housing agency (including program income derived
therefrom) are authorized for use by the public housing
agency or by the Secretary for the payment of principal
and interest, and fees, due on the loans under this section.
‘‘(f) FEES AND PREMIUMS.—The Secretary is au-
thorized to charge such fees and premiums as the Sec-
retary determines necessary to cover the cost, as defined
by the Federal Credit Reform Act of 1990, to the Federal
Government with respect to any loan made under this
section.
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‘‘(g) PROGRAM REQUIREMENTS.—To assure the full
repayment of loans made under this section, as well as
the payment of any fees and premiums charged in connec-
tion with the loans, and as a prior condition for receiving
the loans, the Secretary shall require—
‘‘(1) the public housing agency to—
‘‘(A) enter into a contract, in a form ac-
ceptable to the Secretary, for repayment of the
loans and the other specified charges;
‘‘(B) pledge for repayment of the loan any
amount received under the comprehensive grant
program under section 14 or grant for which
the public housing agency may become eligible
under this title and other financial resources,
including rental and other public housing agen-
cy income; however, in no case may a loan be
granted if the only pledged source of repayment
is amounts received under the comprehensive
grant program under section 18; and
‘‘(C) furnish, at the discretion of the Sec-
retary, such other security as may be deemed
appropriate by the Secretary in making such
loans, which may include public housing
projects, accounts, or other land or housing
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owned by the agency or the proceeds of disposi-
tion thereof; and
‘‘(2) the State or unit of general local govern-
ment in which the public housing agency is located
to enter into a contract in a form acceptable to the
Secretary under which the jurisdiction shall pledge
its financial assets, tax revenues, and other Federal
payments, including amounts from present and fu-
ture allocations under title I of the Housing and
Community Development Act of 1974, as collateral
for repayment of some portion of the loan. In the
event of default, the State or unit of general local
government shall pay a share of the remaining un-
paid debt service proportional to its pledge.
‘‘(h) APPLICATION OF PLEDGED AMOUNTS.—Not-
withstanding any other provision of Federal, State, or
local law, the Secretary is authorized to apply allocations,
grants, and sums from other sources pledged under this
section to any remaining debt service due the United
States as a result of such loans.
‘‘(i) PROGRAM
ADMINISTRATION.—The Secretary
shall monitor the use of loans under this section by public
housing agencies. If the Secretary finds that 50 percent
of the annual loan authority has been committed, or public
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housing agencies have applied for such commitments, the
Secretary may—
‘‘(1) impose limitations on the amount of loans
any public housing agency may receive in any fiscal
year; or
‘‘(2) request the enactment of legislation in-
creasing the aggregate limitation on loans under this
section.
‘‘(j) TRAINING AND INFORMATION.—The Secretary
may carry out training and information collection and dis-
semination activities in support of this section using funds
otherwise set aside for technical assistance under section
14.’’.
USE OF MODERNIZATION FUNDS FOR REPLACEMENT
HOUSING
SEC. 202. Section 14 of the United States Housing
Act of 1937 is amended by adding the following new sub-
section at the end thereof:
‘‘(q) A public housing agency may use assistance
under this section for the development of additional hous-
ing under this Act, in accordance with requirements appli-
cable to the development of public housing, and for 15-
year project-based assistance and 5-year tenant-based as-
sistance, in accordance with section 8, to provide replace-
ment housing as required by section 18.’’.
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FACILITATE USE OF PUBLIC-PRIVATE PARTNERSHIPS IN
MODERNIZING PUBLIC HOUSING
SEC. 203. Section 14(c)(1) of the United States
Housing Act of 1937 is amended by inserting before the
semicolon the following: ‘‘or, as determined by the Sec-
retary, controlled by the agencies’’.
MODIFICATION OF THE EARLY CHILDHOOD
DEVELOPMENT PROGRAM
Sec. 204. (a) The heading for section 222 of the
Housing and Urban-Rural Recovery Act of 1983 is
amended to read as follows: ‘‘EARLY CHILDHOOD DEVEL-
OPMENT
PROGRAMS
FOR
PUBLIC
HOUSING
RESIDENTS
AND HOMELESS FAMILIES’’.
(b) Section 222(b)(1) of such Act is amended by in-
serting before the semicolon the following: ‘‘, except that
the Secretary may make a grant to provide additional as-
sistance for an existing child care center assisted under
this section or to expand an existing child care center re-
gardless of whether or not such center was previously as-
sisted under this section’’.
(c) Section 222 of such Act is amended—
(1) in subsection (a)(1), by inserting before the
period the following: ‘‘(including, for purposes of
this section, homeless families with children, as de-
fined by the Secretary)’’; and
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(2) by redesignating paragraphs (2) and (3) of
subsection (c) as paragraphs (3) and (4), and insert-
ing after paragraph (1) the following new para-
graph:
‘‘(2) take into account the proximity of home-
less facilities to the proposed site at which the serv-
ices are proposed to be provided;’’.
(d) Section 222(g) of such Act is amended by striking
the first two sentences and inserting in lieu thereof the
following: ‘‘There are authorized to be appropriated to
carry out this section $35,000,000 for fiscal year 1995
and $35,000,000 for fiscal year 1995 and $35,000,000 for
fiscal year 1996.’’.
ENTREPRENEURIAL PHAS AND RMCS
SEC. 205. (a) The Secretary may authorize public
housing agencies and resident management corporations
to conduct demonstrations that—
(1) test the extent to which aspects of the public
housing program may be exempt from certain statu-
tory requirements while continuing to serve eligible
families, and
(2) permit agencies and RMCs to set policies
for the operation, maintenance, management, and
development (including modernization) of one or
more projects, without regard to the requirements
applicable to public housing in the 1937 Act. In es-
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tablishing these policies, agencies and RMCs shall be
bound by any applicable State or local law. A dem-
onstration may be approved for a term of up to 5
years.
(b) The Secretary may waive requirements of the
1937 Act that the Secretary determines are not consistent
with the purposes of a demonstration, except require-
ments—
(1) limiting occupancy to low-income families,
as defined in section 3 of the 1937 Act;
(2) under section 18 of that Act requiring re-
placement of units in the case of demolition or dis-
position (except that the limitation on the use of
tenant-based assistance to applications proposing
demolition or disposition of 200 or more units may
be waived); and
(3) relating to labor standards.
The Secretary may also waive any other statutory require-
ments that apply to the project and that the Secretary
determines are not consistent with the purposes of a dem-
onstration, except that the Secretary may not waive the
Uniform Relocation Assistance and Real Property Acquisi-
tion Policies Act of 1970 or any statutory requirements
pertaining to equal opportunity or nondiscrimination or
the environment.
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(c) The Secretary may select a total of up to 25 pub-
lic housing agencies or RMCs (or a combination of both)
to carry out up to 25 demonstrations under this section.
The Secretary shall select agencies based on selection cri-
teria including such factors as—
(1) the need for a range of project sizes;
(2) the need for a range of types of public hous-
ing agencies and RMCs; and
(3) the potential effects and benefits the vari-
ations proposed by the agency or RMC could have
on the public housing program if the variations were
adopted for the whole program.
(d) Each demonstration under this section shall—
(1) be approved personally by the Secretary;
(2) taken as a whole over the life of the dem-
onstration, not result in higher costs to the Federal
Government;
(3) be consistent with the overall purposes of
the public housing program;
(4) be evaluated by an independent party; and
(5) be consistent with the Fair Housing Act,
title VI of the Civil Rights Act of 1964, section 504
of the Rehabilitation Act of 1973, the Age Discrimi-
nation Act of 1975, and the National Environmental
Policy Act of 1969.
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(e) In approving a demonstration under this section,
the Secretary may impose such requirements as the Sec-
retary considers to be appropriate to further its purposes.
(f) For each demonstration site, the agency or RMC
carrying out the demonstration shall submit an annual
progress report to the Secretary. The Secretary shall sub-
mit a report to Congress within 1 year after completion
of the demonstration, describing the results of the dem-
onstration and making any recommendations for legisla-
tion.
(g) 
There 
is 
authorized 
to 
be 
appropriated
$1,000,000 for the evaluation of demonstrations under
this section.
(h) As used in this section:
(1) ‘‘Secretary’’ means the Secretary of Hous-
ing and Urban Development.
(2) ‘‘1937 Act’’ means the United States Hous-
ing Act of 1937.
(3) ‘‘Public housing agency’’ or ‘‘agency’’
means a public housing agency, as defined in section
3(b)(6) of the 1937 Act. The term includes Indian
housing authorities.
(4) ‘‘Resident management corporation’’ or
‘‘RMC’’ means a resident management corporation
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established in accordance with requirements of the
Secretary under section 20 of the 1937 Act.
DISALLOWANCE OF EARNED INCOME FOR RESIDENTS
WHO OBTAIN EMPLOYMENT
SEC. 206. (a) DISALLOWANCE OF EARNED INCOME
FROM PUBLIC HOUSING RENT DETERMINATIONS.—
(1) IN
GENERAL.—Section 3 of the United
States Housing Act of 1937 is amended by striking
the undesignated paragraph at the end thereof and
inserting in lieu thereof the following new sub-
section:
‘‘(d) DISALLOWANCE
OF EARNED INCOME FROM
PUBLIC HOUSING RENT DETERMINATIONS.—Notwith-
standing any other provision of law, the rent payable
under subsection (a) for any public housing unit by a fam-
ily whose income increases as a result of employment of
a member of the family who was previously unemployed
for one or more years (including a family whose income
increases as a result of the participation of a family mem-
ber in the Family Self-Sufficiency program or other job-
training program) may not be increased for a period of
18 months, beginning with the commencement of employ-
ment as a result of the increased income due to such em-
ployment. After the expiration of the 18-month period,
rent increases due to the continued employment of such
a family member shall be limited to 10 percent per year.
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In no case shall rent exceed the amount determined under
subsection (a).’’.
(2) APPLICABILITY OF AMENDMENT.—Notwith-
standing the amendment made by paragraph (1),
any resident of public housing participating in the
program under the authority contained in the undes-
ignated paragraph at the end of section 3(c)(3) of
the United States Housing Act of 1937, as such
paragraph existed before the date of enactment of
this Act, shall continue to be governed by such au-
thority.
(b) REPEALER.—Section 957 of the Cranston-Gon-
zalez National Affordable Housing Act is hereby repealed.
CEILING RENTS BASED ON REASONABLE RENTAL VALUE
SEC. 207. (a) Section 3(a)(2)(A)(iii) of the United
States Housing Act of 1937 is amended to read as follows:
‘‘(iii) is not less than the reasonable rental
value of the unit, as determined by the Sec-
retary.’’.
(b) REGULATIONS.—
(1) IN GENERAL.—The Secretary shall, by reg-
ulation, after notice and an opportunity for public
comment, establish such requirements as may be
necessary to carry out the provisions of section
3(a)(2)(A) of the United States Housing Act of
1937, as amended by subsection (a).
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(2) TRANSITION RULE.—Prior to the issuance
of final regulations under paragraph (1), a public
housing agency may implement ceiling rents which
shall be—
(A) determined in accordance with section
3(a)(2)(A) of the United States Housing Act of
1937, as such section existed before the date of
enactment of this Act; or
(B) equal to the 95th percentile of the rent
paid for a unit of comparable size by tenants in
the same project or a group of comparable
projects totaling 50 units or more.
AUTHORIZATION TO SELL PUBLIC HOUSING TO NON-
PROFIT ORGANIZATIONS
SEC. 208. The first sentence of section 5(h) of the
United States Housing Act of 1937 is amended by striking
‘‘lower income tenants’’ and inserting: ‘‘low-income fami-
lies or to non-profit organizations for resale to low-income
families’’.
Subtitle B—Severely Distressed Public Housing Program
REVITALIZATION OF SEVERELY DISTRESSED PUBLIC
HOUSING
SEC. 211. (a) SEVERELY
DISTRESSED
PUBLIC
HOUSING.—Section 24 of the United States Housing Act
of 1937 is amended as provided by this subsection.
(1) DESIGNATION OF ELIGIBLE PROJECTS.—
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(A) Subsection (b) is amended to read as
follows:
‘‘(b) (RESERVED).’’
(B) Subsection (i)(2) is hereby repealed
and the following paragraphs redesignated ac-
cordingly.
(2) 
INCREASE
PLANNING
GRANT
DOLLAR
CAP.—Subsection (c)(2) is amended by striking
‘‘$200,000’’ and inserting ‘‘$500,000’’.
(3) PLANNING
GRANT
ELIGIBLE
ACTIVITIES:
COMMUNITY SERVICE.—Subsection (c)(3) is amend-
ed by—
(A) inserting the following new subpara-
graph after subparagraph (D) and redesignat-
ing the following subparagraphs accordingly:
‘‘(E) planning for community service and
support service activities to be carried out by
the public housing agency, residents, members
of the community, and other persons and orga-
nizations willing to contribute to the social, eco-
nomic, or physical improvement of the commu-
nity (community service is a required element of
the revitalization program);’’; and
(B) in subparagraph (H), as redesignated,
by striking ‘‘designing a suitable replacement
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housing plan’’ and inserting ‘‘designing suitable
relocation and replacement housing plans,’’;
(4) PLANNING
GRANT
APPLICATION: COMMU-
NITY SERVICE.—Subsection (c)(4) is amended by in-
serting the following new subparagraphs after sub-
paragraph (C) and redesignating the following sub-
paragraphs accordingly:
‘‘(D) a description of the community serv-
ice and support service planning activities to be
carried out by the public housing agency, resi-
dents, members of the community, and other
persons and organizations willing to contribute
to the social, economic, or physical improvement
of the community;’’.
(5) PLANNING
GRANT
SELECTION
CRITERIA:
NATIONAL
GEOGRAPHIC
DIVERSITY.—Subsection
(c)(5) is amended by—
(A) striking subparagraph (E) and redesig-
nating the following subparagraphs accordingly;
(B) in subparagraph (E), as redesignated,
by inserting before the semicolon ‘‘, taking into
account the condition of the stock of the public
housing agency as a whole’’; and
(C) adding at the end the following: ‘‘In
making grants, under this subsection, the Sec-
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retary may select a lower-rated, approvable ap-
plication over a higher-rated application to in-
crease the national geographic diversity among
applications approved under this section.’’.
(6) IMPLEMENTATION GRANT ELIGIBLE ACTIVI-
TIES.—
(A) Subsection (d)(2) is amended by in-
serting the following new subparagraphs after
subparagraph (D) and redesignating the follow-
ing subparagraphs accordingly:
‘‘(E) community service and support serv-
ice activities to be carried out by the public
housing agency, residents, members of the com-
munity, and other persons willing to contribute
to the social, economic, or physical improvement
of the community (community service is a re-
quired element of the revitalization program);
‘‘(F) replacement of public housing units;’’.
(B) Subsection (d)(2)(K), as redesignated
by subparagraph (A) of this paragraph, is
amended by—
(i) striking ‘‘15 percent’’ and insert-
ing ‘‘20 percent’’; and
(ii) inserting before the period of the
following: ‘‘except that an amount equal to
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15 percent of the amount of any grant
under this subsection used for support
services shall be contributed from non-Fed-
eral sources (which contribution shall be in
the form of cash, administrative costs, and
the reasonable value of in-kind contribu-
tions and may include funding under title
I of the Housing and Community Develop-
ment Act of 1974)’’.
(7) IMPLEMENTATION
GRANT
APPLICATIONS:
COMMUNITY SERVICE.—Subsection (d)(3) is amend-
ed by inserting the following new subparagraph after
subparagraph (C) and redesignating the following
subparagraphs accordingly:
‘‘(D) a description of the community serv-
ice and support activities to be carried out by
the public housing agency, residents, members
of the community, and other persons and orga-
nizations willing to contribute to the social, eco-
nomic, or physical improvement of the commu-
nity;’’.
(8) IMPLEMENTATION GRANT SELECTION CRI-
TERIA: NATIONAL
GEOGRAPHIC
DIVERSITY.—Sub-
section (d)(4) is amended by—
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(A) in subparagraph (D), by inserting
‘‘(with assistance from the Department of
Housing and Urban Development if necessary)’’
after ‘‘applicant’’;
(B) striking subparagraph (E) and redes-
ignating the following subparagraphs accord-
ingly;
(C) in subparagraph (E), as redesignated,
by inserting before the semicolon ‘‘, taking into
account the condition of the applicant’s stock as
a whole’’; and
(D) adding at the end the following: ‘‘In
making grants, under this subsection, the Sec-
retary may select a lower-rated, approvable ap-
plication over a higher-rated application to in-
crease the national geographic diversity among
applications approved under this section.’’.
(9) EXCEPTIONS
TO
GENERAL
PROGRAM
RE-
QUIREMENTS.—Subsection (e) is amended by adding
at the end the following new paragraph:
‘‘(3) DEMOLITION AND REPLACEMENT.—
‘‘(A) IN GENERAL.—Notwithstanding any
other applicable law or regulation, a revitaliza-
tion plan under this section may include demoli-
tion and replacement on site or in the same
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neighborhood if the number of replacement
units provided in the same neighborhood is
fewer than the number of units demolished as
a result of the revitalization effort.
‘‘(B) TENANT-BASED
ASSISTANCE.—Not-
withstanding the limitations contained in sub-
paragraph (A)(v) or (C) of section 18(b) (3), a
public housing agency may replace not more
than one-third of the units demolished or dis-
posed of through a revitalization project under
this section with tenant-based assistance under
section 8.’’.
(10) DEFINITIONS.—(A) Subsection (h)(5) is
amended to read as follows:
‘‘(5) SEVERELY
DISTRESSED
PUBLIC
HOUS-
ING.—The term ‘severely distressed public housing’
means a public housing project or a building in a
project—
‘‘(A) that requires major redesign, recon-
struction, redevelopment, or partial or total
demolition to correct serious deficiencies in the
original design (including inappropriately high
population 
density), 
deferred 
maintenance,
physical deterioration or obsolescence of major
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systems, and other deficiencies in the physical
plant of the project; and
‘‘(B) that either—
‘‘(i)(I) is occupied predominantly by
families with children that have extremely
low incomes, high rates of unemployment,
and extensive dependency on various forms
of public assistance; and
‘‘(II) has high rates of vandalism and
criminal activity (including drug-related
criminal activity); or
‘‘(ii) that has a vacancy rate, as deter-
mined by the Secretary, of 50 percent or
more; and
‘‘(C) that cannot be revitalized through as-
sistance under other programs, such as the pro-
grams under sections 9 and 14, or through
other administrative means because of the inad-
equacy of available funds; and
‘‘(D) that in the case of individual build-
ings, the building is, in the Secretary’s deter-
mination, sufficiently separable from the re-
mainder of the project to make use of the build-
ing feasible for purposes of this section.’’.
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(B) Subsection (h) is amended by adding the
following new paragraphs at the end thereof:
‘‘(6) COMMUNITY SERVICE.—The term ‘commu-
nity service’ means services provided on a volunteer
basis for the social, economic, or physical improve-
ment of the community to be served.
‘‘(7) SUPPORT SERVICES.—The term ‘support
services’ includes all activities designed to lead to-
ward upward mobility, self-sufficiency, and improved
quality of life for the residents of the project, such
as literacy training, job training, day care, and eco-
nomic development. Such activities may allow for the
participation of residents of the neighborhood.’’.
(b) CONFORMING AMENDMENT.—The first sentence
of section 25(m)(1) of the United States Housing Act of
1937 is amended to read as follows: ‘‘The term ‘eligible
housing’ means a public housing project, or one or more
buildings within a project, that is owned or operated by
a troubled public housing agency that has been troubled
for not less than 3 years and that, as determined by the
Secretary, has failed to make substantial progress toward
effective management.’’.
(c) USE OF TENANT-BASED ASSISTANCE FOR RE-
PLACEMENT HOUSING.—Section 18(b)(3)(C)(i) of the
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‘‘(II) complete the plan on schedule in
accordance with subparagraph (E);
‘‘(III) meet the requirements of sub-
paragraph (F) of this paragraph and the
maximum rent provisions of subparagraph
(G); and
‘‘(IV) not impose a local residency
preference on any resident of the jurisdic-
tion of the original agency for purposes of
admission to any such units; and
‘‘(iii) the arrangement is approved by the
unit of general local government for the juris-
diction in which the additional units will be lo-
cated.’’.
MODERNIZATION PROGRAM RESERVE FUNDS
SEC. 212. The first sentence of section 14(k)(1) of
the United States Housing Act of 1937 is amended by
inserting before the period the following: ‘‘and for mod-
ernization needs in connection with the settlement of liti-
gation and desegregation of public housing.’’.
ELIGIBILITY OF SEVERELY DISTRESSED PUBLIC HOUSING
FOR PUBLIC HOUSING OPERATING SUBSIDIES
SEC. 213. Section 9(a)(2) of the United States Hous-
ing Act of 1937 is amended—
(1) by inserting immediately after ‘‘one’’ the
following: ‘‘that is (A)’’; and
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(2) by inserting immediately after ‘‘section 8,’’
the following: ‘‘or (B) assisted under section 24 or
the program authorized under (i) the third para-
graph of the head, HOMEOWNERSHIP AND OPPOR-
TUNITY FOR PEOPLE EVERYWHERE GRANTS (HOPE
GRANTS), of the Department of Veterans Affairs and
Housing and Urban Development, and Independent
Agencies Appropriations Act, 1993, or (ii) the head,
SEVERELY DISTRESSED PUBLIC HOUSING PROJECTS,
of the Department of Veterans Affairs and Housing
and Urban Development, and Independent Agencies
Appropriations Act, 1994,’’.
APPLICABILITY OF SECTION 24 AND URD STATUTE AND
RULES
SEC. 214. Notwithstanding any provisions of the
United States Housing Act of 1937, with respect to a pub-
lic housing project that has been selected for funding
under section 24 of such Act or through the Urban Revi-
talization Demonstration program included in the Depart-
ments of Veterans Affairs and Housing and Urban Devel-
opment, and Independent Agencies Appropriation Act,
1993 (Public Law 102–389) or the Departments of Veter-
ans Affairs and Housing and Urban Development, and
Independent Agencies Appropriation Act, 1994 (Public
Law 103–124) and that has an approved comprehensive
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plan under section 14 of the United States Housing Act
of 1937—
(1) the Secretary may exempt such projects
from any requirements of the United States Housing
Act of 1937 and may establish such requirements as
the Secretary deems appropriate for any activities
funded under section 24 or through the Urban Revi-
talization Demonstration program and for any other
activities undertaken at the project pursuant to the
approved comprehensive plan and contributing to the
revitalization, including activities relating to demoli-
tion, modernization reconstruction, site improve-
ments, and replacement of housing; however, in no
event may the Secretary waive, or specify alternative
requirements for, statutory requirements related to
nondiscrimination, fair housing, labor standards, the
environment, or the Uniform Relocation Assistance
and Real Property Acquisition Policies Act of 1970;
(2) for the replacement of public housing units
either on the site of such a project or on other sites,
the Secretary may establish such standards as the
Secretary deems appropriate with respect to the as-
sessment of racial and socio-economic information
relevant to the placement of public housing units on
the site; and
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(3) for such a revitalized project, the Secretary
may establish such requirements as the Secretary
deems appropriate with respect to income eligibility,
the selection of tenants, the establishment of rents,
and for the operation and management of the
projects.
Subtitle C—Anti-Crime Initiatives
COMMUNITY PARTNERSHIPS AGAINST CRIME
SEC. 221. (a) CONFORMING PROVISIONS.—Section
5001 of the Anti-Drug Abuse Act of 1988 is amended in
the table of contents—
(1) by striking the item relating to the heading
for chapter 2 and inserting the following:
‘‘CHAPTER 2—COMMUNITY PARTNERSHIPS AGAINST CRIME’’;
(2) by striking the item relating to section 5122
and inserting the following:
‘‘Sec. 5122. Purposes.’’;
and
(3) by adding the following after the item relat-
ing to section 5130:
‘‘Sec. 5131. Technical assistance.’’.
(b) SHORT TITLE, PURPOSES, AND AUTHORITY TO
MAKE GRANTS.—The Public and Assisted Housing Drug
Elimination Act of 1990 is amended by striking the chap-
ter heading for chapter 2, and by striking sections 5121,
5122, and 5123, and inserting the following:
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‘‘CHAPTER 2—COMMUNITY
PARTNERSHIPS AGAINST CRIME
‘‘SEC. 5121. SHORT TITLE.
‘‘This chapter may be cited as the ‘Community Part-
nerships Against Crime Act of 1994’.
‘‘SEC. 5122. PURPOSES.
‘‘The purposes of this chapter are to—
‘‘(1) improve the quality of life for law-abiding
public housing residents by reducing the levels of
fear, violence, and crime in their communities;
‘‘(2) expand and enhance the Federal Govern-
ment’s commitment to eliminating crime in public
housing;
‘‘(3) broaden the scope of the Public and As-
sisted Housing Drug Elimination Act of 1990 to
apply to all types of crime, and not simply crime
that is drug-related;
‘‘(4) target opportunities for long-term commit-
ments of funding primarily to public housing agen-
cies with serious crime problems;
‘‘(5) encourage the involvement of a broad
range of community-based groups, and residents of
neighboring housing that is owned or assisted by the
Secretary, in the development and implementation of
anti-crime plans;
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‘‘(6) reduce crime and disorder in and around
public housing through the expansion of community-
oriented policing activities and problem solving;
‘‘(7) provide training, information services, and
other technical assistance to program participants;
and
‘‘(8) establish a standardized assessment sys-
tem to evaluate need among public housing agencies,
and to measure progress in reaching crime reduction
goals.
‘‘SEC. 5123. AUTHORITY TO MAKE GRANTS.
‘‘The Secretary of Housing and Urban Development,
in accordance with the provisions of this chapter, may
make grants, for use in eliminating crime in and around
public and other federally assisted low-income housing
projects (1) to public housing agencies (including Indian
housing authorities), and (2) to private, for-profit, and
non-profit owners of federally assisted low-income housing.
In designing the program, the Secretary shall consult with
the Attorney General.’’.
(c) ELIGIBLE ACTIVITIES.—(1) Section 5124(a) of
the Public and Assisted Housing Drug Elimination Act
of 1990 is amended—
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(A) in the introductory material preceding para-
graph (1), by inserting ‘‘and around’’ after ‘‘used
in’’;
(B) in paragraph (3), by inserting ‘‘, such as
fencing, lighting, locking, and surveillance systems’’
before the semicolon;
(C) in paragraph (4), by striking subparagraph
(A) and inserting the following new subparagraph:
‘‘(A) to investigate crime; and’’;
(D) in paragraph (6)—
(i) by striking ‘‘in and around public or
other federally assisted low-income housing
projects’’; and
(ii) by striking ‘‘and’’ after the semicolon;
(E) in paragraph (7)—
(i) by striking ‘‘where a public housing
agency receives a grant,’’;
(ii) by striking ‘‘drug abuse’’ and inserting
‘‘crime’’; and
(iii) by striking the period at the end and
inserting a semicolon; and
(F) by adding at the end the following new
paragraphs:
‘‘(8) the employment or utilization of one or
more individuals, including law enforcement officers,
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made available by contract or other cooperative ar-
rangement with State or local law enforcement agen-
cies, to engage in community policing involving
interaction with members of the community on
proactive crime control and prevention;
‘‘(9) youth initiatives, such as activities involv-
ing training, education, after school programs, cul-
tural programs, recreation and sports, career plan-
ning, and entrepreneurship and employment; and
‘‘(10) resident services programs, such as job
training, education programs, drug and alcohol
treatment, and other appropriate social services that
address the contributing factors of crime.’’.
(2) Section 5124(b) of such Act is amended by strik-
ing ‘‘(7)’’ and inserting in lieu thereof ‘‘(10)’’.
(d) APPLICATIONS.—Section 5125 of the Public and
Assisted Housing Drug Elimination Act of 1990 is amend-
ed—
(1) in subsection (a)—
(A) by striking ‘‘To receive a grant’’ and
inserting the following:
‘‘(1) APPLICATIONS.—To receive a grant’’;
(B) in the second sentence, by striking
‘‘drug-related crime on the premises of’’ and in-
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serting the following: ‘‘crime in and around’’;
and
(C) by adding at the end the following new
paragraphs:
‘‘(2) ONE-YEAR RENEWABLE GRANTS.—
‘‘(A) IN
GENERAL.—Eligible applicants
may submit an application for a 1-year grant
under this chapter that, subject to the availabil-
ity of appropriated amounts, shall be renewed
annually for a period of not more than 4 years,
if the Secretary finds, after an annual or more
frequent performance review, that the public
housing agency is performing under the terms
of the grant and applicable laws in a satisfac-
tory manner and meets such other requirements
as the Secretary may prescribe.
‘‘(B) PREFERENCE.—The Secretary shall
accord a preference to applicants for grants
under this paragraph if the grant is to be used
to continue or expand activities eligible for as-
sistance under this chapter that have received
previous assistance either under this chapter, as
it existed prior to the enactment of the Housing
Choice and Community Investment Act of
1994, or under section 14 of the United States
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Housing Act of 1937. Such preference shall not
preclude the selection by the Secretary of other
meritorious applications, particularly applica-
tions which address urgent or severe crime
problems or which demonstrate especially prom-
ising approaches to reducing crime. Such pref-
erence shall not be construed to require con-
tinuation of activities determined by the Sec-
retary to be unworthy of continuation.
‘‘(3) PUBLIC HOUSING AGENCIES THAT HAVE
ESPECIALLY SEVERE CRIME PROBLEMS.—The Sec-
retary shall, by regulation issued after notice and
opportunity for public comment, set forth criteria for
establishing a class of public housing agencies that
have especially severe crime problems. The Secretary
may allocate a portion of the annual appropriation
for this program for public housing agencies in this
class.’’.
(2) in subsection (b)—
(A) by striking the introductory material
preceding paragraph (1) and inserting the fol-
lowing: ‘‘The Secretary shall approve applica-
tions under subsection (a)(2) that are not sub-
ject to a preference under subsection (a)(2)(B)
on the basis of—’’;
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(B) in paragraph (1), by striking ‘‘drug-re-
lated crime problem in’’ and inserting the fol-
lowing: ‘‘crime problem in and around’’;
(C) in paragraph (2), by inserting imme-
diately after ‘‘crime problem in’’ the following:
‘‘and around’’; and
(D) in paragraph (4), by inserting after
‘‘local government’’ the following: ‘‘, local com-
munity-based non-profit organizations, local
resident organizations that represent the resi-
dents of neighboring projects that are owned or
assisted by the Secretary,’’;
(3) in subsection (c)(2), by striking ‘‘drug-relat-
ed’’ each place it appears; and
(4) by striking subsection (d).
(e) DEFINITIONS.—Section 5126 of the Public and
Assisted Housing Drug Elimination Act of 1990 is amend-
ed by striking paragraphs (1) and (2), and redesignating
paragraphs (3) and (4) as paragraphs (1) and (2), respec-
tively.
(f) IMPLEMENTATION.—Section 5127 of the Public
and Assisted Housing Drug Elimination Act of 1990 is
amended by striking ‘‘Cranston-Gonzalez National Afford-
able Housing Act’’ and inserting ‘‘Housing Choice and
Community Investment Act of 1994’’.
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(g) REPORTS.—Section 5128 of the Public and As-
sisted Housing Drug Elimination Act of 1990 is amend-
ed—
(1) by striking ‘‘The Secretary’’ and inserting
the following: ‘‘(a) GRANTEE REPORTS.—The Sec-
retary’’;
(2) by striking ‘‘drug-related crime in’’ and in-
serting ‘‘crime in and around’’; and
(3) by adding at the end the following new sub-
section:
‘‘(b) HUD REPORTS.—The Secretary shall submit a
report to the Congress describing the system used to dis-
tribute funds to grantees under this section. Such report
shall include, at a minimum—
‘‘(1) a description of the criteria used to estab-
lish the class of public housing agencies with espe-
cially severe crime problems and a list of such agen-
cies;
‘‘(2) the methodology used to distribute funds
among the public housing agencies on the list cre-
ated under paragraph (1); and
‘‘(3) the Secretary’s recommendations for any
change to the method of distribution of funds.’’.
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(h) AUTHORIZATION OF APPROPRIATIONS.—Section
5130 of the Public and Assisted Housing Drug Elimi-
nation Act of 1990 is amended—
(1) in the first sentence of subsection (a), by
striking ‘‘$175,000,000 for fiscal year 1993’’ and all
that follows up to the period and inserting
‘‘$265,000,000 
for 
fiscal 
year 
1995, 
and
$265,000,000 for fiscal year 1996’’;
(2) in subsection (b)—
(A) in the heading, by striking ‘‘SET-
ASIDES’’ and inserting ‘‘SET-ASIDE’’; and
(B) by striking the second sentence; and
(3) by adding at the end the following new sub-
section (d):
‘‘(d) SET-ASIDE
FOR PUBLIC/PRIVATE PARTNER-
SHIPS.—Of any amount made available in any fiscal year
to carry out this chapter, 2 percent of such amount shall
be available for contracts, grants, cooperative agreements,
or interagency agreements with public housing agencies
(including Indian housing authorities) and other public or
private organizations, to implement programs which in-
volve joint investment by the public and private sectors
to conduct activities designed to reduce crime and violence
in public housing. Such activities may include the creation
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of pilot programs or the replication of successful existing
programs.’’.
(i) REPEAL.—Section 520(k) of the Cranston-Gon-
zalez National Affordable Housing Act is hereby repealed.
(j) TECHNICAL ASSISTANCE.—The Public and As-
sisted Housing Drug Elimination Act of 1990 is further
amended by adding at the end the following new section:
‘‘SEC. 5131. TECHNICAL ASSISTANCE.
‘‘Of the amounts appropriated annually for each of
fiscal years 1995 and 1996 to carry out this chapter, the
Secretary shall use not more than $10,000,000, directly
or indirectly, under grants, contracts, or cooperative
agreements, to provide training, information services, and
other technical assistance to public housing agencies and
other entities with respect to their participation in the pro-
gram authorized by this chapter. Such technical assistance
may include the establishment and operation of the clear-
inghouse on drug abuse in public housing and the regional
training program on drug abuse in public housing under
sections 5143 and 5144 of this Act. The Secretary is also
authorized to use the foregoing amounts for obtaining as-
sistance in establishing and managing assessment and
evaluation criteria and specifications, and obtaining the
opinions of experts in relevant fields.’’.
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AUTHORITY FOR ASSISTED HOUSING OWNERS AND
PUBLIC HOUSING AGENCIES TO BAN GUNS
SEC. 222. (a) The United States Housing Act of
1937, as amended by section 201, is amended by adding
at the end the following new section:
‘‘SEC. 28. AUTHORITY FOR PUBLIC HOUSING AGENCIES
AND OWNERS AND LESSORS OF ASSISTED
HOUSING TO BAN GUNS.
‘‘Notwithstanding any State or local law to the con-
trary, a public housing agency or other owner or lessor
of housing assisted under this Act may utilize leases which
ban the possession, use, and discharge of firearms in and
around the housing.’’.
(b) Notwithstanding any State or local law to the con-
trary, the owner or lessor of any housing project assisted,
or financed with a mortgage insured, under a program of
the Secretary of Housing and Urban Development may
utilize leases which ban the possession, use, and discharge
of firearms in and around the project.
MAKE CRIMINAL RECORDS AVAILABLE FOR SCREENING
AND EVICTIONS
SEC. 223. Section 6 of the United States Housing
Act of 1937 is amended by inserting the following new
subsection at the end:
‘‘(p) Notwithstanding any other provision of Federal,
State, or local law, the National Crime Information Cen-
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ter, police departments, and any other law enforcement
entities shall provide information to public housing agen-
cies upon request regarding the criminal records of appli-
cants for, or residents of, public housing for the purpose
of applicant screening, lease enforcement, and eviction. An
agency may pay a reasonable fee for such information.’’.
Subtitle D—Authorizations and Extensions
LOW-INCOME HOUSING
SEC. 231. (a) AGGREGATE BUDGET AUTHORITY.—
Section 5(c)(6) of the United States Housing Act of 1937
(42 U.S.C. 1437c(c)(6)) is amended by adding at the end
the following new sentence: ‘‘The aggregate amount of
budget authority that may be obligated for assistance re-
ferred to in paragraph (7) is increased (to the extent ap-
proved in appropriation Acts) by at least $14,024,876,000
on October 1, 1994, and by at least $6,388,276,000 on
October 1, 1995.’’.
(b) UTILIZATION OF BUDGET AUTHORITY.—Section
5(c)(7) of the United States Housing Act of 1937 (42
U.S.C. 1437c(c)(7)) is amended by striking the paragraph
designation and all that follows through the end of sub-
paragraph (B) and inserting the following:
‘‘(7)(A) Using the additional budget authority
provided under paragraph (6) and the balances of
budget authority that become available during fiscal
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year 1995, the Secretary shall, to the extent ap-
proved in appropriation Acts, reserve authority to
enter into obligations aggregating—
‘‘(i) for public housing grants under sub-
section (a)(2), not more than $413,000,000, of
which amount not more than $263,000,000
shall be available for Indian housing;
‘‘(ii) for assistance under section 8, not
more 
than 
$2,743,000,000, 
of 
which
$514,275,000 shall be available for 15-year
contracts for the Community Investment Dem-
onstration program under section 6 of the
HUD 
Demonstration 
Act 
of 
1993,
$514,275,000 shall be for homeless assistance
and $171,425,000 shall be for assistance for
the disabled;
‘‘(iii) for modernization grants under sec-
tion 14(k), not more than $2,786,000,000, in-
cluding $15,000,000 for training and technical
assistance;
‘‘(iv) for assistance under section 8 for
loan 
management, 
not 
more 
than
$150,000,000;
‘‘(v) for extensions of contracts expiring
under section 8, $5,092,000,000, which shall be
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for contracts for assistance under section 8 and
vouchers under section 8(o) and for loan man-
agement assistance under such section;
‘‘(vi) for amendments to contracts under
section 8, $2,202,100,000;
‘‘(vii) for adjustments to annual contribu-
tions contracts for the costs of providing service
coordinators under section 9(a)(1)(B)(2), not
more than $30,000,000;
‘‘(viii) for public housing lease adjust-
ments, $21,900,000;
‘‘(ix) for assistance under section 18(e) for
replacement housing for units demolished or
disposed of under section 18, and for eligible
tenants where project owners opt out of the sec-
tion 8 program, not more than $82,916,000;
‘‘(x) for conversions for leased housing
contracts under section 23 of this Act (as in ef-
fect immediately before the enactment of the
Housing and Community Development Act of
1974) to assistance under section 8, not more
than $3,960,000; and
‘‘(xi) for grants under section 24 for revi-
talization of severely distressed public housing,
not more than $500,000,000.
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‘‘(iv) for assistance under section 8 for
loan 
management, 
not 
more 
than
$150,000,000;
‘‘(v) for extensions of contracts expiring
under section 8, such sums as may be nec-
essary, which shall be for contracts for assist-
ance under section 8 and vouchers under sec-
tion 8(o) and for loan management assistance
under such section;
‘‘(vi) for amendments to contracts under
section 8, such sums as may be necessary;
‘‘(vii) for adjustments to annual contribu-
tions contracts for the costs of providing service
coordinators under section 9(a)(1)(B)(ii), not
more than $30,000,000;
‘‘(viii) for public housing lease adjust-
ments, $21,900,000;
‘‘(ix) for assistance under section 18(e) for
replacement housing for units demolished or
disposed of under section 18, and for eligible
tenants where project owners opt out of the sec-
tion 8 program, not more than $82,916,000;
‘‘(x) for conversions from leased housing
contracts under section 23 of this Act (as in ef-
fect immediately before the enactment of the
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Housing and Community Development Act of
1974) to assistance under section 8, not more
than $3,960,000; and
‘‘(xi) for grants under section 24 for revi-
talization of severely distressed public housing,
not more than $500,000,000.’’.
PUBLIC HOUSING OPERATING SUBSIDIES
SEC. 232. Section 9(c) of the United States Housing
Act of 1937 (42 U.S.C. 1437g(c)) is amended—
(1) in paragraph (1), by striking ‘‘There’’ and
all that follows and inserting the following new sen-
tence: ‘‘There are authorized to be appropriated for
purposes of providing annual contributions under
this section $2,496,000,000 for fiscal year 1995 and
$2,376,000,000 for fiscal year 1996.’’;
(2) in paragraph (2), by striking ‘‘1993 and
1994’’ and inserting ‘‘1995 and 1996’’; and
(3) in paragraph (3), by striking ‘‘1993 and
1994’’ and inserting ‘‘1995 and 1996’’.
FAMILY SELF-SUFFICIENCY PROGRAM
SEC. 233. The last sentence of section 23(h)(2) of
the United States Housing Act of 1937 (42 U.S.C.
1437u(h)(2)) is amended to read as follows: ‘‘Of amounts
appropriated under section 9(c), $17,300,000 for fiscal
year 1995 and $17,732,000 for fiscal year 1996 are au-
thorized to be used for costs under this paragraph.’’.
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PUBLIC HOUSING FAMILY INVESTMENT CENTERS
SEC. 234. Section 22(k) of the United States Hous-
ing Act of 1937 (42 U.S.C. 1437t(k)) is amended to read
as follows:
‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated to carry out this section
$26,342,000 for fiscal year 1995 and $27,001,000 for fis-
cal year 1996.’’.
REVISED CONGREGATE SERVICES PROGRAM
SEC. 235. Section 802(n)(1) of the Cranston-Gon-
zalez National Affordable Housing Act (42 U.S.C.
8011(n)(1)) is amended by striking ‘‘$25,000,000’’
through ‘‘1992’’ and inserting in lieu thereof, ‘‘$6,267,000
for fiscal year 1995’’.
INDIAN HOUSING LOAN GUARANTEE PROGRAM
SEC. 236. (a) LIMITATION ON OUTSTANDING AGGRE-
GATE PRINCIPAL AMOUNT.—Section 184(i)(5)(C) of the
Housing and Community Development Act of 1992 (12
U.S.C. 1515z–13a(i)(5)(C)) is amended—
(1) by striking ‘‘fiscal years 1993 and 1994’’
and inserting in lieu thereof ‘‘fiscal years 1995 and
1996’’; and
(2) by striking ‘‘not exceeding’’ and all that fol-
lows, and inserting in lieu thereof, ‘‘not exceeding
$22,388,000 for fiscal year 1995 and $22,388,000
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for fiscal year 1996, to the extent provided in appro-
priation Acts.’’.
(b) AUTHORIZATION OF APPROPRIATIONS FOR GUAR-
ANTEE FUND.—Section 184(i)(7) of the Housing and
Community Development Act of 1992 (12 U.S.C. 1515z–
13a(i)(7)) is amended to read as follows:
‘‘(7) AUTHORIZATION
OF
APPROPRIATIONS.—
There are authorized to be appropriated to the
Guarantee 
Fund 
to 
carry 
out 
this 
section
$3,000,000 for fiscal year 1995 and $3,000,000 for
fiscal year 1996.’’.
Subtitle E—Applicability
APPLICABILITY OF PUBLIC HOUSING AMENDMENTS TO
INDIAN HOUSING
SEC. 241. (a) Section 201(b) of the United States
Housing Act of 1937 is amended to read as follows:
‘‘(b) APPLICABILITY OF TITLE I.—Except as other-
wise provided by law, the provisions of title I shall apply
to low-income housing developed or operated pursuant to
a contract between the Secretary and an Indian housing
authority.’’.
(b) The amendment made by subsection (a) shall not
affect provisions of the United States Housing Act of
1937 that were made applicable to public housing devel-
oped or operated pursuant to a contract between the Sec-
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retary of Housing and Urban Development and an Indian
Housing Authority in accordance with section 201(b)(2)
of such Act, as it existed before the effective date of this
section.
(c) The provisions of section 955(b) of the Cranston-
Gonzalez National Affordable Housing Act, sections
103(a)(1), 112, 114, 116, 118, 903, and 927 of the Hous-
ing and Community Development Act of 1992, and sec-
tions 301, 302, 303, and 304 of the Multifamily Housing
Property Disposition Reform Act of 1994 shall also apply
to public housing developed or operated pursuant to a con-
tract between the Secretary of Housing and Urban Devel-
opment and an Indian Housing authority.
(d) The application of section 955(b) of the Cranston-
Gonzalez National Affordable Housing Act to public hous-
ing developed or operated pursuant to a contract between
the Secretary of Housing and Urban Development and an
Indian Housing Authority shall apply to any volunteer
services provided before, on, or after the date of enactment
of this Act, except that such application may not be con-
strued to require the repayment of any wages paid before
the date of enactment of this Act for services provided be-
fore such date.
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TITLE III—HOMEOWNERSHIP; FHA MORTGAGE
INSURANCE AUTHORIZATIONS
Subtitle A—Expand Single Family Homeownership
Opportunities
SINGLE FAMILY MORTGAGE INSURANCE IN
REVITALIZATION AREAS
SEC. 301. (a) ESTABLISHMENT OF PROGRAM.—Title
II of the National Housing Act is amended by adding at
the end thereof the following new section:
‘‘SINGLE FAMILY MORTGAGE INSURANCE IN
REVITALIZATION AREAS
‘‘SEC. 256. (a) GENERAL AUTHORITY.—The Sec-
retary is authorized to insure mortgages in accordance
with the provisions of this section, and to make commit-
ments to insure such mortgages before the date of their
execution or disbursement thereon.
‘‘(b) ELIGIBLE MORTGAGORS.—A mortgage may be
insured under this section only with respect to a mortga-
gor who—
‘‘(1) has an income not exceeding 115 percent
of the median income for the area, as determined by
the Secretary with adjustments for smaller and larg-
er families, except that the Secretary may establish
income ceilings higher or lower than 115 percent of
the median for the area on the basis of the Sec-
retary’s findings that such variations are necessary
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because of prevailing levels of construction costs or
unusually high or low family incomes and except
that no income ceiling may exceed 140 percent of
the median for the area;
‘‘(2) is a first-time homebuyer, as defined in
section 104(14) of the Cranston-Gonzalez National
Affordable Housing Act;
‘‘(3) will occupy the dwelling as his or her prin-
cipal residence;
‘‘(4) has received such pre-purchase counseling
as the Secretary deems appropriate with respect to
the responsibilities and financial management in-
volved in homeownership;
‘‘(5) has not previously been a mortgagor under
this section;
‘‘(6) has assets not exceeding such amount as
the Secretary may prescribe; and
‘‘(7) meets such other requirements as the Sec-
retary may prescribe.
‘‘(c) ELIGIBLE MORTGAGES.—A mortgage may be in-
sured under this section only if the mortgage—
‘‘(1) has been made to, and is held by, a mort-
gagee approved by the Secretary as responsible and
able to service the mortgage properly;
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‘‘(2) covers a one-family dwelling (including a
one-family unit in a condominium development and
shares representing a one-family unit in a coopera-
tive development) that is located in a revitalization
area which is—
‘‘(A) an empowerment zone or enterprise
community approved under Subchapter U of
Chapter 1 of the Internal Revenue Code of
1986, or in an equivalent State-approved enter-
prise zone; or
‘‘(B) an urban neighborhood that, in the
determination of the Secretary, is targeted by a
unit of general local government for revitaliza-
tion using coordinated affordable housing pro-
grams and enhanced supportive services;
‘‘(3) involves a principal obligation (exclusive of
any charges and costs in connection with the loan,
including initial service charges and appraisal and
inspection fees) in an amount not exceeding the less-
er of—
‘‘(A) $67,500 or 75 percent of the maxi-
mum mortgage amount determined under sec-
tion 203(b)(2)(A), whichever is greater; or
‘‘(B) 100 percent of the appraised value of
the property as of the date the mortgage is ac-
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cepted for insurance: Provided, That in any
case where the dwelling is not approved for
mortgage insurance before the beginning of
construction, the mortgage may not exceed 90
percent of the appraised value of the property
as of the date the mortgage is accepted for in-
surance, unless—
‘‘(i) the dwelling was completed more
than one year before the application for
mortgage insurance; or
‘‘(ii) the dwelling was approved for
guaranty, insurance, or a direct loan under
chapter 37 of title 38, United States Code,
before the beginning of construction; or
‘‘(iii) the dwelling is covered by a
consumer protection or warranty plan ac-
ceptable to the Secretary and satisfies all
requirements that would have been applica-
ble if the dwelling had been approved for
mortgage insurance before the beginning of
construction.
‘‘(4) has a maturity satisfactory to the Sec-
retary, but not to exceed 30 years from the date of
the beginning of amortization of the mortgage;
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‘‘(5) contains complete amortization provisions
satisfactory to the Secretary requiring periodic pay-
ments by the mortgagor not in excess of the mortga-
gor’s reasonable ability to pay, as determined by the
Secretary;
‘‘(6) bears interest at such rate as may be
agreed upon by the mortgagor and the mortgagee;
‘‘(7) provides, in a manner satisfactory to the
Secretary, for the application of the mortgagor’s
periodic payments (exclusive of the amount allocated
to interest and to the premium charge which is re-
quired for mortgage insurance as hereinafter pro-
vided) to amortization of the principal of the mort-
gage;
‘‘(8) contains such terms and provisions with
respect to insurance, repairs, alterations, payment of
taxes, default reserves, delinquency charges, fore-
closure proceedings, anticipation of maturity, addi-
tional and secondary liens, and other matters as the
Secretary may prescribe; and
‘‘(9) complies with such other terms and condi-
tions as the Secretary may prescribe.
‘‘(d) EXPENSES OF MORTGAGOR.—
(1) IN GENERAL.—The mortgagor shall pay all
charges and costs in connection with the mortgage,
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including any costs necessary to close the mortgage:
Provided, That some or all of these charges and
costs may be paid on behalf of the mortgagor by any
person or entity (including the seller, a governmental
jurisdiction, or a private non-profit entity), under
such terms and conditions as the Secretary may pre-
scribe.
‘‘(2) LOAN TO COVER EXPENSES.—Any charges
or costs paid on behalf of a mortgagor under para-
graph (1) may be in the form of a loan secured by
the property under such terms and conditions as the
Secretary may prescribe. Any such indebtedness—
‘‘(A) shall be a lien subordinate to that of
the insured mortgage;
‘‘(B) shall not be part of the loan secured
by the mortgage insured under this section, and
‘‘(C) shall not be considered for purposes
of determining the maximum mortgage amount
under subsection (c)(3).
‘‘(e) MORTGAGE INSURANCE PREMIUM.—
‘‘(1) IN GENERAL.—In connection with the in-
surance of a mortgage under this section, the Sec-
retary shall establish and collect a deferred up-front
premium and an annual premium, as provided in
section 203(c)(2) of this Act and section 2103(b)(2)
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of the Omnibus Budget Reconciliation Act of 1990,
except as provided by paragraph (2) of this sub-
section.
‘‘(2) PAYMENT OF DEFERRED UP-FRONT PRE-
MIUM.—
‘‘(A) IN GENERAL.—The mortgagee shall
pay the amount of the deferred up-front pre-
mium due under subparagraph (B) at the time
of the sale of the property or when the mort-
gage is paid in full, and shall remit the amount
to the Secretary according to such procedures
and at such time as the Secretary may pre-
scribe.
‘‘(B) AMOUNT OF PAYMENT.—The amount
of the up front premium payable to the Sec-
retary under paragraph (2) shall be the lesser
of—
‘‘(i) the amount of the premium es-
tablished under paragraph (1), minus any
refund due; and
‘‘(ii) 50 percent of the net apprecia-
tion of the property, as determined by the
Secretary, if the premium is due because
of a sale of the property.
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‘‘(C) DEFINITION.—For purposes of the
subparagraph (B), ‘net appreciation of the
property’ means any increase in the value of the
property over the original purchase price, less
the reasonable costs of sale and the reasonable
costs of improvements made to the property.
‘‘(3) 
STREAMLINE
REFINANCING.—Notwith-
standing paragraph (2), no part of the up-front pre-
mium established in connection with a mortgage
that was insured under this section and that is refi-
nanced under section 223(a)(7) shall be payable
under paragraph (2).
‘‘(f) DEFINITION.—For purposes of this section, the
term ‘appraised value’ means the amount set forth in the
written statement required under section 226, or a similar
amount determined by the Secretary if section 226 does
not apply.
‘‘(g) OBLIGATION OF GENERAL INSURANCE FUND.—
Any mortgagee under a mortgage insured under this sec-
tion is entitled to receive the benefits of the insurance as
provided in section 204(a) with respect to mortgages in-
sured under section 203, and the provisions of subsections
(b), (c), (d), (e), (f), (g), (h), (j), and (k) of section 204
shall apply to the mortgages insured under this section,
except that—
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‘‘(1) all references in section 204 to the Mutual
Mortgage Insurance Fund or the Fund shall be con-
strued to refer to the General Insurance Fund;
‘‘(2) all references therein to section 203 shall
be construed to refer to this section; and
‘‘(3) the excess remaining, referred to in section
204(f)(1), shall be retained by the Secretary and
credited to the General Insurance Fund.
‘‘(h) LIMIT ON INSURED MORTGAGES.—The aggre-
gate dollar amount of commitments to insure mortgage
under this section for any fiscal year may not exceed 5
percent of the amount of commitments to insure mort-
gages covering one- to four-family properties that were
made by the Secretary under this title during the preced-
ing fiscal year. However, the Secretary may make commit-
ments to insure mortgages for up to an additional 5 per-
cent in the case of properties in empowerment zones or
enterprise communities approved under subchapter U of
chapter 1 of the Internal Revenue Code of 1986, or in
equivalent State: approved enterprise zones. No more than
20 percent of the dwelling units located in a revitalization
area may be subject to a mortgage insured under this sec-
tion.’’.
(b) IMPLEMENTATION.—The Secretary shall, by in-
terim rule published for effect in the Federal Register, es-
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tablish such requirements as may be necessary to carry
out the provisions of subsection (a). The Secretary shall
issue final regulations based on the interim rule after no-
tice and opportunity for public comment.
(c) EVALUATION.—No later than 48 months after the
date of implementation, the Secretary shall evaluate the
program and, if appropriate, recommend to Congress leg-
islation to terminate or improve it.
MAXIMUM DOLLAR AMOUNT FOR FHA SINGLE FAMILY
MORTGAGES
SEC. 302. Subparagraph (A) of the first sentence of
section 203(b)(2) of the National Housing Act is amended
by striking clause (ii) and all that follows through
‘‘‘1992;’’ and inserting in lieu thereof the following—
‘‘(ii) 85 percent of the dollar amount limitation
determined under section 305(a)(2) of the Federal
Home Loan Mortgage Corporation Act for a resi-
dence of the applicable size; except that the applica-
ble dollar amount limitation in effect for any area
under this subparagraph (A) may not be less than
the greater of—
‘‘(I) the dollar amount limitation in effect
under this section for the area on the date of
enactment of the Housing Choice and Commu-
nity Investment Act of 1994; or
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‘‘(II) the applicable average area purchase
price determined under section 143(e)(2) of the
Internal Revenue Code of 1986, adjusted by the
Secretary to reflect a single amount using pur-
chase prices for residences that have been pre-
viously occupied, and for residences that have
not been so occupied, which amount shall be ad-
justed by the Secretary annually on the basis of
the Constant Quality Housing Price Index;’’.
STREAMLINED REFINANCING FOR HUD-HELD MORTGAGES
SEC. 303. (a) Section 223(a) of the National Housing
Act is amended—
(1) in paragraph (7), by striking the colon im-
mediately preceding the second proviso and all that
follows though ‘‘and the mortgagee’’;
(2) by redesignating paragraph (8) as para-
graph (9) and inserting the following new paragraph
immediately after paragraph (7):
‘‘(8) given to refinance a mortgage held by the
Secretary, upon such terms and conditions as the
Secretary may prescribe, covering property on which
there is located a one- to four-family residence, or a
one-family unit in a condominium project, which
mortgage was formerly insured under this Act and
subsequently assigned to the Secretary: Provided,
That the mortgagor has not previously refinanced a
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mortgage pursuant to this paragraph: Provided fur-
ther, That the mortgagor has made all payments due
under the note secured by the existing mortgage and
all payments due under the note for at least the pre-
vious 6 months, or the mortgagor is under a forbear-
ance agreement and has made all payments due
under the note secured by the existing mortgage for
at least the previous 6 months: Provided further,
That the principal amount of the refinancing mort-
gage may not exceed the outstanding principal bal-
ance of the existing mortgage by more than addi-
tional amounts owed by the mortgagor due to the
delinquency and to the receipt of assignment assist-
ance under section 230: Provided further, That the
monthly payment due under the refinancing mort-
gage may not exceed the monthly payment due
under the existing mortgage: Provided further, That
the refinancing mortgage may have a term not more
than 12 years in excess of the unexpired term of the
assigned mortgage: Provided further, That the refi-
nancing mortgage may be insured under section
203(b) or 221(d)(2) of this Act, at the option of the
mortgagee, or under section 234(c) of this Act in the
case of a condominium: Provided further, That a re-
financing mortgage insured under section 221(d)(2)
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shall involve a principal obligation in an amount not
to exceed 50 percent of the applicable dollar limita-
tion for a one- to four-family residence under section
203(b)(2); or’’; and
(3) by adding the following new paragraph after
paragraph (9), as redesignated by paragraph (2) of
this section:
‘‘(10) a mortgage of the character described in
paragraphs (1) through (6) of this subsection shall
have a maturity and a principal obligation not in ex-
cess of the maximums prescribed under the applica-
ble section or title of this Act, except that in no case
may the principal obligation of a mortgage referred
to in paragraph (5) of this subsection exceed 90 per-
cent of the appraised value of the mortgage prop-
erty, and shall bear interest at such rate as may be
agreed upon by the mortgagor and the mortgagee.’’.
(b) The Secretary of Housing and Urban Develop-
ment may implement the authority to refinance a mort-
gage held by the Secretary under section 223(a)(8) of the
National Housing Act, as added by subsection (a) of this
section, by notice published in the Federal Register setting
forth such requirements as may be necessary.
(c) The authority to refinance a mortgage held by the
Secretary of Housing and Urban Development under such
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section 223(a)(8) shall terminate 30 months after the date
of enactment of this Act. The total number of mortgages
refinanced under such section 223(a)(8) may not exceed
20,000.
INNOVATIVE AFFORDABLE HOUSING DEMONSTRATIONS
SEC. 304. (a) The Secretary of Housing and Urban
Development (the ‘‘Secretary’’) may carry out demonstra-
tions which have the potential to increase homeownership
opportunities through the insurance under the National
House Act of alternative mortgage instruments, and
through partnerships with the Federal Home Loan Mort-
gage Corporation and the Federal National Mortgage As-
sociation, with the Federal Home Loan Banks and their
members, and with State and local housing finance agen-
cies, in connection with meeting their responsibilities to
achieve affordable housing goals. These demonstrations
may include testing the pricing of different types of in-
sured mortgage instruments, partnerships with the Cor-
poration, the Association, or the Federal Home Loan
Banks under which mortgage insurance provided by the
Secretary shall be used as a credit enhancement in connec-
tion with their mortgage lending and secondary market
activities, and partnership activities to achieve both home-
ownership and the stabilization or revitalization of neigh-
borhoods or to address special needs.
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(b) Each demonstration may be approved for a term
of up to 3 years. The term of an insured mortgage or ac-
tivity may extend beyond the term of the demonstration.
The total number of mortgages insured pursuant to dem-
onstrations under this section in any fiscal year may not
exceed 10 percent of the number of single family mort-
gages insured in the previous fiscal year. The total number
of mortgages insured pursuant to any one demonstration
in any fiscal year may not exceed 5 percent of the number
of single family mortgages insured in the previous fiscal
year.
(c) The Secretary may waive requirements of the Na-
tional Housing Act and any other applicable statutory and
regulatory requirements that the Secretary determines are
not consistent with the purposes of this section.
(d) The general insurance fund created by section
519 of the National Housing Act shall be available as a
revolving fund for carrying out mortgage insurance dem-
onstrations under this section involving alternative mort-
gage transactions. The Secretary shall determine the
terms and conditions of insurance, notwithstanding any
provision of the National Housing Act.
(e) In approving a demonstration under this section,
the Secretary may establish such requirements as the Sec-
retary considers to be appropriate to further its purposes.
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(f) Each demonstration under this section shall—
(1) be approved personally by the Secretary;
(2) be consistent with the overall purposes of
the program or programs under which the waiver is
granted;
(3) be evaluated; and
(4) be consistent with the Fair Housing Act,
title VI of the Civil Rights Act of 1964, section 504
of the Rehabilitation Act of 1973, and the Age Dis-
crimination Act of 1975.
(g) For each demonstration, there shall be prepared
an annual progress report. The Secretary shall submit a
report to Congress within 1 year after completion of each
demonstration, describing the results of the demonstration
and making any recommendations for legislation.
(h) 
There 
is 
authorized 
to 
be 
appropriated
$1,000,000 for the evaluation of demonstrations under
this section.
(i) The term ‘‘alternative mortgage instruments’’ in-
cludes mortgages within the definition of ‘‘alternative
mortgage transaction’’ in section 803(1) of the Alternative
Mortgages Transaction Party Act of 1982.
SINGLE FAMILY RISK-SHARING MORTGAGE INSURANCE
PROGRAM
SEC. 305. (a) The National Housing Act is amended
by adding the following new section at the end of title II:
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‘‘SINGLE FAMILY RISK-SHARING WITH STATE AND LOCAL
AGENCIES
‘‘SEC. 257. (a) AUTHORITY.—Notwithstanding any
other provision of this Act inconsistent with this section,
the Secretary may insure and make commitments to in-
sure under this section mortgages on single family prop-
erties under risk-sharing mortgage insurance programs es-
tablished with one or more State or agencies. Only mort-
gages executed in connection with the acquisition of a sin-
gle family property or for the refinancing of a mortgage
insured under this section shall be eligible. Under these
programs, the Secretary insures a portion of the mortgage
and the State or local agency insures the remainder.
‘‘(b) PURPOSES.—The purposes of the program
under this section are (1) to increase the availability of
single family mortgage financing in areas where there is
need for mortgage insurance under this Act that cannot
be met due to particularly high average median house
prices in the area, and (2) to foster arrangements with
State and local agencies to share the risk of mortgage in-
surance.
‘‘(c) APPLICATIONS.—(1) The Secretary may approve
an application submitted by a State or local agency to es-
tablish a risk-sharing program under this section, based
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on a determination that the State or local agency dem-
onstrates that—
‘‘(A) it has the legal authority under State law
and, where applicable, local law to participate in the
risk-sharing mortgage insurance program;
‘‘(B) it has carried out, or has the potential to
carry out, a financially sound, efficient, and effective
mortgage insurance program; and
‘‘(C) it has the ongoing administrative and fi-
nancial capacity necessary to carry out a program
under this section.
‘‘(2) For a violation of requirements and procedures
under the risk-sharing agreement between the State or
local agency and the Secretary or for other good cause,
the Secretary may cancel approval of a State or local agen-
cy under this section by giving notice to the State or local
agency. The cancellation shall be effective upon receipt of
the notice by the agency or at a later date specified by
the Secretary. A decision by the Secretary to cancel ap-
proval shall be final and conclusive and shall not be sub-
ject to judicial review.
‘‘(d) DELEGATION OF AUTHORITY TO INSURE TO
STATE AND LOCAL AGENCIES.—Pursuant to a risk-shar-
ing agreement with a State or local agency, the Secretary
shall delegate the authority to insure and make commit-
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ments to insure the portion of mortgages to be insured
by the Secretary under this section to the State or local
agency. The risk-sharing agreement shall contain such
other matters as the Secretary and the State or local agen-
cy agree.
‘‘(e) UNDERWRITING STANDARDS AND LOAN TERMS
AND CONDITIONS.—The State or local agency shall adopt
underwriting standards and loan terms and conditions for
purposes of underwriting loans to be insured under this
section without regard to requirements of this Act other
than this section, section 203(g), and section 203(r)(2),
subject to review and approval by the Secretary.
‘‘(f) MORTGAGE INSURANCE PREMIUMS.—(1) The
State or local agency shall require the payment of mort-
gage insurance premiums by mortgagors.
‘‘(2) The Secretary shall establish policies and proce-
dures for the sharing of premiums between the Secretary
and the State or local agency, based on the relative risk
to, and administrative costs of, the Secretary and the
State or local agency. The share paid to the Secretary
shall not be less than an amount necessary to cover the
risk to, and administrative costs of, the Secretary.
‘‘(g) 
LIMITATIONS
ON
PRINCIPAL
MORTGAGE
AMOUNT.—(1) The portion of the mortgage insured under
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this section by the Secretary may not exceed an amount
equal to the lesser of—
‘‘(A) 80 percent of the appraised value of the
property, or
‘‘(B) the maximum amount the Secretary may
insure under section 203(b) of this Act for the area
(but not including any amount for a mortgage insur-
ance premium).
‘‘(2) The total principal amount of a mortgage in-
sured under this section by the Secretary and the State
or local agency—
‘‘(A) shall exceed the maximum amount the
Secretary may insure under subparagraph (A) of the
first sentence of section 203(b)(2) of this Act for the
area, and
‘‘(B) may not exceed the conforming loan limi-
tation determined under section 305(a)(2) of the
Federal Home Loan Mortgage Corporation Act for
a residence of the applicable size, as adjusted annu-
ally.
‘‘(3) The principal obligation of a mortgage may not
exceed an amount determined in accordance with subpara-
graph (B) of the first sentence of section 203(b)(2) of this
Act plus the mortgage insurance premium.
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‘‘(4) Notwithstanding paragraph 92)(A) or (3), in the
case of refinancing of an existing mortgage insured under
this section, the principal obligation of a refinancing mort-
gage may not exceed the outstanding principal balance of
the existing mortgage plus any mortgage insurance pre-
mium.
‘‘(h) INSURANCE CLAIMS.—(1) In the case of a de-
fault and foreclosure of a mortgage insured under this sec-
tion, the mortgagee may file a claim with the State or
local agency for insurance benefits in accordance with re-
quirements established by the State or local agency and
approved by the Secretary. The agency shall pay the full
amount of the claim owed to the mortgagee. If the loss
on the insured mortgage exceeds the amount of insurance
by the agency, the Secretary shall reimburse the agency
for the difference.
‘‘(2) The insurance of a mortgage under this section
by the Secretary shall be an obligation of the General In-
surance Fund created pursuant to section 519 of this Act.
‘‘(i) INAPPLICABILITY OF THE ASSIGNMENT PRO-
GRAM.—Section 230 shall not apply to mortgages insured
under the program authorized by this section.
‘‘(j) RESTRICTION
ON GNMA SECURITIZATION.—
The Government National Mortgage Association shall not
securitize any loans insured under this section.
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‘‘(k) DEFINITIONS.—As used in this section:
‘‘(1) The term ‘local agency’ shall mean an
agency of a unit of general local government, as de-
fined by the Secretary, which has the authority to
insure mortgages and to participate with the Sec-
retary in the single family risk-sharing program
under this section, or an agency or instrumentality
of a local agency if the agency or instrumentality
has such authority.
‘‘(2) The term ‘State agency’ shall mean an
agency of a State which has the authority to insure
mortgages and to participate with the Secretary in
the single family risk-sharing program under this
section, or an agency or instrumentality of a State
agency if the agency or instrumentality has such au-
thority.
‘‘(3) The term ‘single family property’ means a
property upon which there is located a dwelling de-
signed principally for occupancy by one family, and
includes a condominium and a cooperative.
‘‘(4) The term ‘State’ shall mean the several
States and Puerto Rico, the District of Columbia,
Guam, the Trust Territory of the Pacific Islands,
American Samoa, and the Virgin Islands.’’.
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(b) The Secretary of Housing and Urban Develop-
ment may implement the program authorized by sub-
section (a) by entering into risk-sharing agreements nego-
tiated with State agencies, notwithstanding any otherwise
applicable requirement for regulations or notice published
in the Federal Register and notwithstanding any otherwise
applicable regulations of the Secretary.
HOMEOWNERSHIP COUNSELING AND OUTREACH
SEC. 306. (a) Section 106(a) of the Housing and
Community Development Act of 1968 is amended—
(1) in paragraph (1), by—
(A) inserting ‘‘or consortia of organiza-
tions’’ after ‘‘organizations’’;
(B) striking the ‘‘and’’ at the end of clause
(iii);
(C) striking the period from the end of
clause (iv) and inserting in lieu thereof ‘‘; and’’;
and
(D) inserting at the end the following new
clause (v):
‘‘(v) the provision of outreach activi-
ties designed to improve the access of low-
and moderate-income households to home-
ownership and sources of mortgage cred-
it.’’;
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(2) in the second sentence of paragraph (2),
by—
(A) striking ‘‘clause (iii)’’ and inserting in
lieu thereof ‘‘clauses (iii) and (v)’’; and
(B) by inserting after ‘‘organizations’’ the
following: ‘‘or consortia of organizations’’;
(3) by inserting at the end the following new
paragraph:
‘‘(4) The Secretary of Housing and Urban De-
velopment may contract with national, State, or
community-based entities, and consortia of such en-
tities, to carry out activities under paragraph (1)(v).
Contractors shall be selected on a competitive basis,
in accordance with selection criteria determined by
the Secretary. The contractors shall carry out activi-
ties prescribed by the Secretary, including activities
such as—
‘‘(A) leveraging Federal funds with other
sources of funding to support activities under
its counseling program, including leveraging
private, community-based resources for the pur-
pose of assisting prospective mortgagors achieve
homeownership;
‘‘(B) conducting outreach and marketing
to prospective homebuyers, particularly those in
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targeted neighborhoods with a high proportion
of low- and moderate-income and minority
renter households;
‘‘(C) coordinating a proactive pre-purchase
homeownership strategy that includes linking
other HUD-approved counseling providers and
community-based organizations, assisting pro-
spective homebuyers to repair credit, educating
potential homebuyers on the requirements of
homeownership, providing technical assistance,
assisting in the packaging of mortgage loan ap-
plications, matching a family’s resources with
appropriate government and private sector
homeownership assistance programs, and offer-
ing post-purchase and default-prevention coun-
seling to help homeowners retain their homes;
and
‘‘(D) serving as an advocate for home-
buyers by working with the mortgage lending
industry with regard to overcoming mortgage
credit barriers to homeownership.’’.
(b) Section 106(c)(9) of such Act is amended by
striking ‘‘September 30, 1994’’ and inserting in lieu there-
of ‘‘September 30, 1996’’.
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(c) Section 106 of such Act is amended by adding
at the end the following new subsection:
‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated for the purposes of this
section, without fiscal year limitation, such sums as may
be necessary, except that there are authorized to be appro-
priated $50,000,000 for each of fiscal years 1995 and
1996. Any amounts so appropriated shall remain available
until expended.’’.
(d) Section 106(a)(3) of such Act is hereby repealed.
Subtitle C—National Homeownership Fund
Demonstration
AMENDMENTS TO NAHA
SEC. 311. Subtitle A of title III of the Cranston-Gon-
zalez National Affordable Housing Act is amended to read
as follows:
‘‘Subtitle A—National Homeownership Fund
Demonstration
‘‘SEC. 301. SHORT TITLE.
‘‘This subtitle may be cited as the ‘National Home-
ownership Fund Demonstration Act’.
‘‘SEC. 302. PROGRAM AUTHORITY.
‘‘(a) IN GENERAL.—The Secretary may provide as-
sistance, in accordance with the provisions of this subtitle,
for first-time homebuyers (including homebuyers buying
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shares in limited equity cooperatives) in the following
manners—
‘‘(1) DOWNPAYMENT ASSISTANCE.—Assistance
payments through grantees to provide amounts for
downpayments (including closing costs and other
costs payable at the time of closing) on mortgages
for such homebuyers.
‘‘(2) SECOND MORTGAGE ASSISTANCE.—Assist-
ance payments through grantees to provide loans
with payment of interest and principal, as deter-
mined by the grantee; and
‘‘(3) CAPITALIZATION
OF
REVOLVING
LOAN
FUNDS.—Grants to public organizations or agencies
to establish revolving loan funds to provide home-
ownership assistance to eligible first-time home-
buyers consistent with the requirements of this sub-
title. Such grants shall be matched by an equal
amount of local investment in such revolving loan
funds. Any proceeds or repayments from loans made
under this paragraph shall be returned to the revolv-
ing loan fund established under this paragraph to be
used for purposes related to this section.
‘‘(b) ELIGIBILITY REQUIREMENTS.—Assistance pay-
ments under this subtitle may be made only to homebuyers
and for mortgages meeting the following requirements.—
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‘‘(1) FIRST-TIME
HOMEBUYER.—The home-
buyer is an individual who—
‘‘(A)(i) (and whose spouse) has had no
ownership in a principal residence during the 3-
year period ending on the date of purchase of
the property with respect to which assistance
payments are made under this subtitle;
‘‘(ii) is a displaced homemaker who, except
for owning a home with his or her spouse or re-
siding in a home owned by the spouse, meets
the requirements of clause (i); or
‘‘(iii) is a single parent who, except for
owning a home with his or her spouse or resid-
ing in a home owned by the spouse while mar-
ried, meets the requirements of clause (i); and
‘‘(B) meets the requirements of subpara-
graph (A)(i), (ii), or (iii), except for owning, as
a principal residence, a dwelling unit whose
structure is not permanently affixed to a per-
manent foundation in accordance with local or
other applicable regulations.
‘‘(2) MAXIMUM INCOME OF HOMEBUYER.—The
aggregate annual income of the homebuyer and the
members of the family of the homebuyer residing
with the homebuyer, for the 12-month period preced-
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ing the date of the application of the homebuyer for
assistance under this subtitle, does not exceed 80
percent of the median income for a family of 4 per-
sons (adjusted by family size) in the applicable met-
ropolitan statistical area (or such other area that the
Secretary determines for areas outside of metropoli-
tan statistical areas). The Secretary shall provide for
certification of such income for purposes of initial
eligibility for assistance payments under this sub-
title.
‘‘(3) PRINCIPAL RESIDENCE.—The property se-
curing the mortgage is a single-family residence or
unit in a cooperative or condominium and is the
principal residence of the homebuyer.
‘‘(4) 
MAXIMUM
MORTGAGE
AMOUNT.—The
principal obligation of the first mortgage and any
second mortgage assistance provided under this sub-
title does not exceed the principal amount that could
be insured with respect to the property under section
203(b) of the National Housing Act.
‘‘(c) TERMS OF ASSISTANCE.—
‘‘(1) SECURITY.—Assistance payments under
this subtitle shall be secured by a lien on the prop-
erty involved. The lien shall be subordinate to all
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mortgages existing on the property on the date on
which the first assistance payment is made.
‘‘(2) REPAYMENT IF PROPERTY CEASES TO BE
PRINCIPAL RESIDENCE.—If the property for which
assistance payments are made ceases to be the prin-
cipal residence of the first-time homebuyer (or the
family of the homebuyer), during a time period spec-
ified by the Secretary or the grantee, whichever is
longer, the Secretary may provide for the repayment
of all or a portion of the assistance payments.
‘‘(d) ALLOCATION.—
‘‘(1) IN GENERAL.—Each applicant shall sub-
mit an application in such form and in accordance
with such procedures as the Secretary shall estab-
lish.
‘‘(2) MINIMUM
REQUIREMENTS.—An applica-
tion under this section shall contain a plan that de-
scribes how the applicant will achieve the objectives
of this subtitle. The application shall contain at a
minimum—
‘‘(A) a description of the geographic area
to be covered;
‘‘(B) the characteristics of the households
to be served;
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‘‘(C) a description and commitment of
other public and private resources available in
connection with assistance under this subtitle;
‘‘(D) a description of any secondary mar-
ket involvement and commitment;
‘‘(E) a description and commitment of any
non-traditional capital resources;
‘‘(F) provision of housing counseling as-
sistance available to assist borrowers;
‘‘(G) a description of any restrictions on
resale and profits;
‘‘(H) a description of resources available to
undertake rehabilitation of properties when
needed;
‘‘(I) the process for award and disburse-
ment of funds to borrowers; and
‘‘(J) the past history of the applicant in
undertaking similar projects.
‘‘(3) SELECTION.—Amounts available in any
fiscal year for assistance under this subtitle shall be
allocated to States (including State agencies) or non-
profit 
housing 
intermediaries 
for 
homebuyers
through a national competition in accordance with
criteria established by the Secretary. These criteria
shall include the extent to which the applicant has
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experience in providing homeownership opportunities
for low- and moderate-income households.
‘‘SEC. 303. DEFINITIONS.
‘‘For purposes of this subtitle:
‘‘(1) DISPLACED HOMEMAKER.—The term ‘dis-
placed homemaker’ means an individual who—
‘‘(A) is an adult;
‘‘(B) has not worked full-time full-year in
the labor force for a number of years, but has
during such years, worked primarily without re-
muneration to care for the home and family;
and
‘‘(C) is unemployed or underemployed and
is experiencing difficulty in obtaining or up-
grading employment.
‘‘(2) SINGLE PARENT.—The term ‘single par-
ent’ means an individual who—
‘‘(A) is unmarried or legally separated
from a spouse; and
‘‘(B)(i) has 1 or more minor children for
whom the individual has custody or joint cus-
tody; or
‘‘(ii) is pregnant.
‘‘(3) SECRETARY.—The term ‘Secretary’ means
the Secretary of Housing and Urban Development.
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‘‘(4) STATE.—The term ‘State’ means the
States of the United States, the District of Colum-
bia, the Commonwealth of Puerto Rico, the Com-
monwealth of the Northern Mariana Islands, Guam,
the Virgin Islands, American Samoa, the Trust Ter-
ritory of the Pacific Islands, and any other territory
or possession of the United States.
‘‘SEC. 304. REPORT.
‘‘The Secretary shall submit to the Congress, not
later than 6 months following the last obligation of assist-
ance by grantees under this subtitle, a report containing
a description of the activities carried out under this sub-
title and an analysis of the effectiveness of such assistance
in assisting first-time homebuyers.
‘‘SEC. 305. AUTHORIZATION OF APPROPRIATIONS.
‘‘There are authorized to be appropriated for assist-
ance payments under this subtitle $100,000,000 for fiscal
year 1995 and such sums as may be necessary for fiscal
year 1996. Any amount appropriated under this section
shall remain available until expended.’’.
Subtitle C—Authorizations Flexible Subsidy Program
SEC. 321. (a) AUTHORIZATION
OF
APPROPRIA-
TIONS.—Section 201(j)(5) of the Housing and Community
Development Amendments of 1978 (12 U.S.C. 1715z–
1a(j)(5)) is amended to read as follows:
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‘‘(5) There are authorized to be appropriated
for assistance under the flexible subsidy fund not to
exceed $50,000,000 for fiscal year 1995 and not to
exceed $50,000,000 for fiscal year 1996.’’.
(b) USE
OF SECTION 236 RENTAL ASSISTANCE
FUND AMOUNTS.—Section 236(f)(3) of the National
Housing Act (12 U.S.C. 1715z–1(f)(3)) is amended by
striking ‘‘September 30, 1994’’ and inserting ‘‘September
30, 1996’’.
SERVICE COORDINATORS IN MULTIFAMILY HOUSING
SEC. 322. There are authorized to be appropriated
for assistance for service coordinators under section 676
of the Housing and Community Development Act of 1992,
section 8(d)(2)(F)(i) of the United States Housing Act of
1937, section 202 of the Housing Act of 1959, and section
811 of the Cranston-Gonzalez National Affordable Hous-
ing Act, $16,300,000 for fiscal year 1995 and
$16,700,000 for fiscal year 1996.
LIMITATION ON GNMA GUARANTEES FOR MORTGAGE-
BACKED SECURITIES
SEC. 323. Section 306(g)(2) of the Federal National
Mortgage Association Charger Act (12 U.S.C. 1721(g)(2))
is amended to read as follows:
‘‘(2) Notwithstanding any other provision of
law and subject only to the absence of qualified re-
quests for guarantees, to the authority provided in
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this subsection, and to the extent of or in such
amounts as any funding limitation approved in ap-
propriation Acts, the Association shall enter into
commitments to issue guarantees under this sub-
section in an aggregate amount of $130,000,000,000
during fiscal year 1995 and $130,000,000,000 dur-
ing fiscal year 1996. There is authorized to be ap-
propriated such sums as may be necessary to cover
the costs (as such term is defined in section 502 of
the Congressional Budget Act of 1974) of guaran-
tees issued under this Act by the Association.’’.
LIMITATION ON FHA INSURING AUTHORITY
SEC. 324. Section 531(b) of the National Housing
Act (12 U.S.C. 1735f–9(b)) is amended to read as follows:
‘‘(b) Notwithstanding any other provision of law and
subject only to the absence of qualified requests for insur-
ance, to the authority provided in this Act, and to the limi-
tation in subsection (a), the Secretary shall enter into
commitments to insure mortgages under this Act with an
aggregate principal amount of $104,666,794,000 during
fiscal year 1995 and $91,037,845,000 during fiscal year
1996.’’.
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TITLE IV—ECONOMIC OPPORTUNITY;
EXPANSION OF AFFORDABLE HOUSING
Subtitle A—Economic Opportunity
ECONOMIC OPPORTUNITIES FOR RESIDENTS IN HUD-
ASSISTED PROGRAMS
SEC. 401. Section 3 of the Housing and Urban Devel-
opment Act of 1968 is amended—
(1) in subsection (c)(1)(B)(i), by inserting ‘‘,
and to noncustodial parents of children living in
such developments and subject to court-ordered or
administratively-ordered support agreements’’ before
the period;
(2) by adding at the end of subsection (c) the
following new paragraph (3):
‘‘(3) ESTABLISHMENT
OF
ECONOMIC
OPPOR-
TUNITY CENTERS.—
‘‘(A) IN
GENERAL.—The Secretary shall
establish Economic Opportunity Centers, to
provide services which will link low-income resi-
dents with jobs generated by housing and com-
munity development assistance.
‘‘(B) ELIGIBLE
GRANTEES.—The Sec-
retary may make grants to State or local gov-
ernments or their agencies, public housing
agencies, including Indian housing authorities,
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public or private non-profit organizations or in-
stitutions (including community action agen-
cies), or other public or private entities—
‘‘(i) which are carrying out training,
employment development, education, or
other economic development activities in
communities which receive housing and
community development assistance; or
‘‘(ii) which provide housing, neighbor-
hood revitalization, community organizing,
income support or crime prevention pro-
grams to low- and very low-income persons
in communities which receive housing and
community development assistance; or
‘‘(iii) which are administering housing
or community development programs which
generate a significant number of employ-
ment opportunities.
‘‘For fiscal year 1995, the Secretary may
make grants under this paragraph only to pub-
lic housing agencies, including Indian housing
authorities.
‘‘(C) SELECTION
CRITERIA.—The Sec-
retary shall select grantees on a competitive
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basis, taking into account the demonstrated
ability of the applicants to—
‘‘(i) assess training and support serv-
ice needs;
‘‘(ii) develop or provide employment
development skills to low-income persons;
‘‘(iii) coordinate and utilize existing
public and private training, employment,
and business assistance funds or services;
‘‘(iv) establish or maintain working
relationships with unions or other con-
struction trade associations, and public
and private employers; and
‘‘(v) perform such other functions as
the Secretary may approve.
‘‘(D) ELIGIBLE ACTIVITIES.—Amounts re-
ceived for the operation of Economic Oppor-
tunity Centers may be used for financial and
other assistance to individual residents to facili-
tate their participation in both existing and
newly created job training programs and em-
ployment opportunities. The agency may engage
in activities such as developing facilities for
training and support services; assessing training
and service needs of public housing residents;
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funding essential training and support services
that are not otherwise funded; establishing a
job bank of positions in connection with pro-
grams subject to this section; assisting contrac-
tors, contractor associations, and joint labor-
management committees to develop and fund
training and apprenticeship initiatives and pro-
grams; training and funding resident councils,
resident management corporations, neighbor-
hood groups, and community-based organiza-
tions to provide information about the require-
ments of this section and economic opportuni-
ties; funding the start-up costs of businesses;
providing links with related government and
private programs; and such other activities as
the Secretary may approve.
‘‘(E) 
AUTHORIZATION
OF
APPROPRIA-
TIONS.—There are authorized to be appro-
priated for grants to carry out this paragraph,
$17,500,000 for fiscal year 1995 and such
sums as may be necessary for fiscal year
1996.’’; and
(3) by adding at the end the following new sub-
sections:
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‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated—
‘‘(1) $4,000,000 in fiscal year 1995 and such
sums as may be necessary in fiscal year 1996 for the
Secretary to establish and sustain employment train-
ing and business initiatives under this section with
other Federal agencies, through interagency agree-
ments providing for the transfer of amounts appro-
priated under this paragraph to other Federal agen-
cies; and
‘‘(2) $3,500,000 in fiscal year 1995 and such
sums as may be necessary in fiscal year 1996 for the
Secretary to carry out a management and technical
assistance program for the development of materials,
systems, services, and information designed to en-
hance—
‘‘(A) the capacity of the Secretary to man-
age activities under this section; and
‘‘(B) the capacity of public housing agen-
cies, contractors, and other entities to comply
with the requirements of this section.
‘‘(i) OTHER RESOURCES.—The Secretary may permit
expenditure of funds appropriated for programs subject to
this section for job-related activities necessary to imple-
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ment this section, including but not limited to training,
supervision of trainees, and job recruitment.’’.
RESIDENT MANAGEMENT/TENANT OPPORTUNITY
PROGRAM
SEC. 402. Section 20 of the United States Housing
Act of 1937 is amended—
(1) by striking the section heading and insert-
ing in lieu thereof: ‘‘TENANT
OPPORTUNITY
PRO-
GRAM’’;
(2) in the first two sentences of subsection (b),
by striking ‘‘resident management program’’ the two
places it appears and inserting ‘‘tenant opportunity
program’’;
(3) in subsection (f)—
(A) by striking the subsection heading and
inserting in lieu thereof: ‘‘TENANT OPPOR-
TUNITY ASSISTANCE’’;
(B) in paragraph (1), by adding the follow-
ing new sentences at the end: ‘‘In addition, the
Secretary may provide financial assistance to
resident management corporations or resident
councils for activities sponsored by resident or-
ganizations for economic uplift, such as job
training, economic development, security, and
other self-sufficiency activities beyond those re-
lated to the management of public housing.
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Resident councils or resident management cor-
porations may jointly apply for financial assist-
ance with public housing agencies.’’;
(C) 
in 
paragraph 
(2), 
by 
striking
‘‘$100,000’’ and inserting ‘‘$250,000’’;
(D) by inserting at the end the following
new paragraph:
‘‘(5) 10 PERCENT SET-ASIDE.—The Secretary
may use up to 10 percent of the amounts appro-
priated under paragraph (3) to enter into contracts
with—
‘‘(A) various entities for monitoring, eval-
uation, technical assistance, and information
dissemination in connection with activities
under this subsection; and
‘‘(B) public housing agencies, resident or-
ganizations, and public or private entities for
innovative public/private initiatives that support
the economic development and increased self-
sufficiency of public housing residents. Eligible
activities related to economic development and
self-sufficiency may include such programs as
counseling, treatment for substance abuse, child
care, remedial education, job training, and de-
velopment of resident businesses.’’; and
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(E) Paragraph (3) is amended to read as
follows:
‘‘(3) FUNDING.—Of any amounts made avail-
able for financial assistance under section 14, the
Secretary may use to carry out this subsection
$85,000,000 for fiscal year 1995 and such sums as
may be necessary for fiscal year 1996.’’.
Subtitle B—Section 8 Initiatives
CHOICE IN RESIDENCY
SEC. 411. (a) Section 8(o) of the United States Hous-
ing Act of 1937, as amended by section 412 of this Act,
is further amended by adding the following new paragraph
at the end:
‘‘(16)(A) The Secretary may make grants to
public housing agencies and nonprofit organizations
for the purpose of providing counseling to applicants
for and recipients of tenant-based assistance. The
counseling shall be designed to enable families to se-
lect units in areas without high concentrations of
persons living in poverty, as determined by the Sec-
retary. Eligible activities may include activities such
as—
‘‘(i) advising families on strategies for ob-
taining appropriate housing;
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‘‘(ii) providing transportation assistance
and other services to give families access to
areas without high concentrations of persons
living in poverty;
‘‘(iii) continuing advice and counseling to
assist families after moving to areas without
high concentrations of persons living in poverty;
and
‘‘(iv) undertaking aggressive outreach to
potential owners to expand the availability of
housing in areas without high concentrations of
persons living in poverty.
‘‘(B) The Secretary may invite public housing
agencies to apply for grants under this paragraph.
In addition, the Secretary may select, on a competi-
tive basis, public housing agencies and nonprofit or-
ganizations for grants under this paragraph. In
making funding decisions, the Secretary may take
into account evidence in the application of commit-
ments of non-Federal assistance to be used in sup-
port of the proposed counseling program.
‘‘(C) The Secretary may take failure by a public
housing agency to apply for a grant under this para-
graph and the effectiveness of an agency’s program
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into account in determining amount of future fund-
ing under this subsection.
‘‘(D) The budget authority available under sec-
tion 5(c) of this Act for tenant-based assistance
under this section is authorized to be increased by
$149,100,000, on or after October 1, 1995, and by
$152,900,000, on or after October 1, 1986, for
grants under this paragraph.’’.
(b) The amendment made by subsection (a) shall
apply to assistance under contract on the date of enact-
ment of this Act as well as to assistance placed under con-
tract after the date of enactment.
MERGER OF THE CERTIFICATE AND VOUCHER PROGRAMS
SEC. 412. (a) MERGER
OF
CERTIFICATE
AND
VOUCHER PROGRAMS.—Section 8(o) of the United States
Housing Act of 1937 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
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that higher market rents in that part of the market area
justify a higher payment standard. The Secretary may re-
quire a public housing agency to submit proposed payment
standards 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-
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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 wel-
fare assistance from a public agency and a part of
such payments, adjusted in accordance with the fam-
ily’s actual housing costs, is specifically designated
by such agency to meet the family’s housing costs,
the portion of such payments which is so designated.
‘‘(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 40 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,
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‘‘(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.
‘‘(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 or appropriate)
of the families who initially receive assistance in any 1-
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year period may be families who do not qualify for such
preference. The public housing agency shall, in implement-
ing the preceding sentence, establish a system of pref-
erences 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
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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.
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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
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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.
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‘‘(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. This 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
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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
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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 interest. To the extent assist-
ance 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)
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
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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.’’.
(b) PORTABILITY.—Section 8(r) of such Act 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
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.’’.
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(c) REPEAL OF REQUIREMENT THAT OWNERS OF MUL-
TIFAMILY HOUSING PROJECTS LEASE TO CERTIFICATE
AND VOUCHER HOLDERS.—Section 8(t) of such Act is
hereby repealed.
(d) HOMEOWNERSHIP OPTION.—Section 8(y) of such
Act 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
with requirements established by the Sec-
retary, do not exceed the payment stand-
ard, the monthly assistance payment shall
be the amount by which the homeowner-
ship expenses exceed the highest of the fol-
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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 designated by such agency
to meet the family’s housing costs, the
portion of such payments which is so
designated.
‘‘(ii) Where the monthly homeowner-
ship expenses, as determined in accordance
with requirements established by the Sec-
retary, exceed the payment standard, the
monthly assistance payment shall be the
amount by which the applicable payment
standard exceeds the highest of the follow-
ing amounts, rounded to the nearest dollar:
‘‘(I) 30 percent of the family’s
monthly adjusted income;
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‘‘(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 designated by such agency
to meet the family’s housing costs, the
portion of such payments which is so
designated.’’.
(e) TECHNICAL AND CONFORMING AMENDMENTS TO
THE 1937 ACT; DELETION OF OBSOLETE PROVISIONS.—
The United States Housing Act of 1937 is amended as
provided by this subsection.
(1) The second and third sentences of section
8(a) are hereby repealed.
(2) Section 8(b) is amended by—
(A) striking ‘‘RENTAL CERTIFICATES AND
OTHER EXISTING HOUSING PROGRAMS.—’’ and
inserting ‘‘CERTIFICATES AND OTHER EXIST-
ING HOUSING PROGRAMS.—(1)’’;
(B) striking the second sentence.
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(3) Section 8(c)(3) is amended by striking the
subparagraph designation ‘‘(A)’’ and striking all of
subparagraph (B).
(4) The first sentence of section 8(c)(4) is
amended by striking ‘‘or by a family that qualifies
to receive’’ and all that follows through ‘‘1990’’.
(5) Sections 8(c) (5) and (7) are hereby re-
pealed.
(6) Section 8(c)(8) is amended by inserting
after ‘‘section’’ the following: ‘‘(other than a con-
tract under section 9(o))’’.
(7) Section 8(c)(9) is amended by striking
‘‘(but not less than 90 days in the case of housing
certificates or vouchers under subsection (b) or (o))’’
and inserting ‘‘, other than a contract under sub-
section (o)’’.
(8) Section 8(d)(1)(A) is amended—
(A) by inserting after the subparagraph
designation ‘‘(A)’’ the following: ‘‘except for as-
sistance under subsection (o),’’;
(B) in clause (i) by striking ‘‘(I)’’;
(C) in clause (i), by striking ‘‘and (II) 90
percent of such families in the case of assist-
ance not attached to a structure’’; and
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(D) in clause (i), by striking ‘‘except’’ and
all that follows through the semicolon at the
end.
(9) Section 8(d)(2) is amended by striking the
third sentence of subparagraph (A) and all that fol-
lows through the end of paragraph (2).
(10) Section 8(f) is amended by—
(A) in paragraph (6), striking ‘‘(d)(2)’’
and inserting ‘‘(o)(13)’’; and
(B) in paragraph (7), striking ‘‘(b) or’’
and inserting before the period the following:
‘‘and that provides for the eligible family to se-
lect suitable housing and to move to other suit-
able housing’’.
(11) Section 8(j) is hereby repealed.
(12) Section 8(n) is hereby repealed.
(13) The first sentence of section 8(q)(1) and
sections 8(q)(2)(A)(i) and 8(q)(2)(B) are each
amended by striking ‘‘subsections (b) and (o)’’ and
inserting ‘‘this section’’.
(14) Section 18(b)(3) is amended—
(A) in subparagraph (A)(v), by striking
‘‘(excluding vouchers under section 8(o))’’ each
place it appears;
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(B) in subparagraph (B), by striking
‘‘8(d)(2)(A)’’ and inserting ‘‘8(o)(13)’’;
(C) in subparagraph (B)(ii), by striking
‘‘(excluding vouchers under section 8(o))’’;
(D) in subparagraph (C)(i), by striking
‘‘and vouchers’’.
(15) Section 21(b)(3) is amended—
(A) in the first sentence, by striking ‘‘cer-
tificate under section 8(b)(1) or a housing
voucher under section 8(o)’’ and inserting ‘‘ten-
ant-based assistance under section 8’’; and
(B) by striking the second sentence.
(16) Section 23(b)(3)(A) is amended by strik-
ing ‘‘Certificate and voucher assistance under sec-
tion 8 (b) and (o)’’ and inserting ‘‘Tenant-based as-
sistance under section 8’’.
(f) OTHER TECHNICAL AND CONFORMING AMEND-
MENTS.—
(1) Section 931 of the Cranston-Gonzalez Na-
tional Affordable Housing Act is amended by strik-
ing ‘‘assistance under the certificate and voucher
programs under sections 8 (b) and (o)’’ and insert-
ing ‘‘tenant-based assistance under section 8’’.
(2) Section 861(b)(1)(D) of the Cranston-Gon-
zalez National Affordable Housing Act is amended
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by striking ‘‘certificates or vouchers’’ and inserting
‘‘assistance’’.
(3) Section 183(c)(2) of the Housing and Com-
munity Development Act of 1987 is amended by
striking ‘‘section 8(o)’’ and inserting ‘‘section 8’’.
(4) Section 223(a) of the Housing and Commu-
nity Development Act of 1987 is amended by strik-
ing ‘‘sections 8(b) and 8(o)’’ and inserting ‘‘section
8’’.
(5) The second sentence of section 533(a) of
the Housing Act of 1949 is amended by striking
‘‘assistance payments as provided by section 8(o)’’
and inserting ‘‘tenant-based assistance as provided
under section 8’’.
(g) IMPLEMENTATION.—The Secretary shall imple-
ment the amendments made by this section by regulation
issued after notice and opportunity for public comment.
The amendments made by this section shall take effect
upon a date specified by the Secretary in the Federal Reg-
ister. The Secretary may provide for the conversion of as-
sistance under the certificate and voucher programs, as
they existed before the effective date of the amendments
made by this section, to the certificate program estab-
lished under this section. However, the Secretary may con-
tinue to apply the provisions of the United States Housing
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Act of 1937 and other statutes amended by this section,
as they existed immediately before such effective date, to
assistance obligated by the Secretary before such effective
date for the certificate or voucher program, where nec-
essary for simplification of program administration, avoid-
ance of hardship, or other good cause.
SECTION 8 CERTIFICATE AND VOUCHER FEES
SEC. 413. (a) Section 8(q)(1) of the United States
Housing Act of 1937 is amended to read as follows:
‘‘(1)(A) The Secretary shall establish fees for
the costs of administering the tenant-based assist-
ance programs under this Act.
‘‘(B)(i) For the initial year the Secretary estab-
lishes fees under this section, as amended by the
Housing Choice and Community Investment Act of
1994, the fee for each month for which a dwelling
unit is covered by an assistance contract shall be
7.65 percent of the base amount in the case of an
agency that, on an annual basis, is administering a
program of more than 1,000 units, and 7 percent of
the base amount for each additional unit above
1,000. The base amount shall be the higher of (I)
the fair market rental for fiscal year 1993 for a 2-
bedroom existing rental dwelling unit in the market
area of the agency, and (II) such fair market rental
for fiscal year 1994, but not more than 103.5 per-
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cent of the amount determined under clause (I); ex-
cept that the Secretary may require that the base
amount be not less than a minimum amount and not
more than a maximum amount.
‘‘(ii) For subsequent fiscal years, the Secretary
shall publish in the Federal Register, for each geo-
graphic area, the amount of the fee that would apply
for agencies administering the program, based on
changes in wage data or other objectively measur-
able data that reflect the costs of administering the
program, as determined by the Secretary.
‘‘(C) The Secretary may increase the fee if nec-
essary to reflect the higher costs of administering
small programs, the family self-sufficiency program
under section 23, and programs operating over large
geographic areas.’’.
(b) Section (8)(q)(2)(A)(i) is amended to read as fol-
lows—
‘‘(i) the costs of preliminary expenses, in the
amount of $500, for a public housing agency, but
only in connection with its initial increment of as-
sistance received in the first year it administers a
tenant-based assistance program under this Act;’’
(c) The amendments made by this section shall take
effect on a date specified by the Secretary in regulations
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implementing the amendments. Until that date, the fees
applicable in fiscal year 1994 shall continue in effect.
Subtitle C—Miscellaneous
SECTION 811 RENTAL ASSISTANCE FOR PERSONS WITH
DISABILITIES
SEC. 421. (a) RENTAL ASSISTANCE FOR EXISTING
BUILDINGS.—Section 811 of the Cranston-Gonzalez Na-
tional Affordable Housing Act is amended—
(1) in subsection (d)(2), by inserting after the
dash the following new sentence:
‘‘The Secretary may enter into contracts with
private, nonprofit organizations to provide
project rental assistance for supportive housing
for persons with disabilities, whether or not
that housing is developed with capital advances
under this section.’’;
(2) in subsection (e)(1), by inserting imme-
diately after ‘‘assisted’’ the following: ‘‘with capital
advances’’;
(3) by amending the first two sentences of sub-
section (e)(2) to read as follows: ‘‘The initial term
of a contract entered into under subsection (d)(2)
shall be 240 months for housing developed with a
capital advance, and shall be not more than 60
months for housing not developed with a capital ad-
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‘‘(2) contracts for project rental assistance in
accordance with subsection (d)(2).
Such assistance may be used to finance the acquisition,
acquisition and moderate rehabilitation, construction, re-
construction, or moderate or substantial rehabilitation of
housing, including the acquisition from the Resolution
Trust Corporation, to be used as supportive housing for
persons with disabilities and may include real property ac-
quisition, site improvement, conversion, demolition, reloca-
tion, and other expenses that the Secretary determines are
necessary to expand the supply of supportive housing for
persons with disabilities.’’;
(2) in each of subsections (d) (1) and (3),
(e)(1), and (g), and in the first and second sentences
of subsection (f), by striking ‘‘subsection (b)(2)’’ and
inserting the following: ‘‘this section’’; and
(3) by striking subsection (d)(4).
(c) TECHNICAL CHANGES.—(1) Section 811(k)(6)(A)
of such Act is amended to read as follows:
‘‘(A) that has received tax-exempt status under
section 501(c) (3) or (4) of the Internal Revenue
Code of 1986;
(2) Section 8(i) of the United States Housing Act of
1937 is hereby repealed.
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FUNDING FOR SUPPORTIVE HOUSING FOR THE ELDERLY
AND FOR PERSONS WITH DISABILITIES
SEC. 422. Section 601 of the Housing and Commu-
nity Development Act of 1992 (Public Law 102–550; 106
Stat. 3802) is amended by striking subsection (a) and in-
serting the following new subsection:
‘‘(a) AGGREGATE FUNDING.—There are authorized
to be appropriated for the purpose of providing assistance
in accordance with section 202 of the Housing Act of 1959
and section 811 of the Cranston-Gonzalez National Af-
fordable Housing Act $537,000,000 for fiscal year 1995
and $387,000,000 for fiscal year 1996. Of the foregoing
amounts, for fiscal year 1995, $387,000,000 shall be to
carry out such section 811, and $150,000,000 shall be to
carry out such section 202. The total amount for fiscal
year 1996 shall be to carry out such section 811.’’.
YOUTHBUILD
SEC. 423. (a) Section 454(b) of subtitle D of title
IV of the Cranston-Gonzalez National Affordable Housing
Act is amended—
(1) in paragraph (2), by striking ‘‘Acquisition’’
and all that follows through ‘‘facilities’’ and insert-
ing in lieu thereof the following: ‘‘Acquisition, reha-
bilitation, or acquisition and rehabilitation of vacant
housing and related facilities, or construction of new
housing and related facilities,’’;
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(2) by striking paragraph (6); and
(3) by designating paragraphs (7) and (8) as
paragraphs (6) and (7), respectively.
(b) Section 454(g) of such Act is hereby repealed.
(c) Section 455(a) of such Act is amended—
(1) in the first sentence, by inserting after ‘‘re-
ceiving assistance under this subtitle’’ the following:
‘‘for costs such as construction, rehabilitation, and
acquisition’’; and
(2) in paragraph (1)(A), by deleting ‘‘less than
60’’ and inserting in lieu thereof ‘‘that do not exceed
50’’.
(d) Section 458(d) of such Act is amended by striking
‘‘(b) and (c)’’ and inserting in lieu thereof ‘‘(a), (b), and
(c)’’.
HOPE AUTHORIZATION OF APPROPRIATIONS
SEC. 424. Sections 402(a) and (b) of the Cranston-
Gonzalez National Affordable Housing Act (42 U.S.C.
12870) are amended to read as follows:
‘‘(a) HOMEOWNERSHIP PROGRAMS.—There are au-
thorized to be appropriated for activities authorized under
title III of the United States Housing Act of 1937, and
subtitles B and C of title IV of the Cranston-Gonzalez Na-
tional Affordable Housing Act, including amounts for
technical assistance, $100,000,000 for fiscal year 1995
and $100,000,000 for fiscal year 1996.
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‘‘(b) YOUTHBUILD PROGRAM.—There are authorized
to be appropriated for activities under subtitle D of title
IV of the Cranston-Gonzalez National Affordable Housing
Act $50,000,000 for fiscal year 1995 and $50,000,000 for
fiscal year 1996. Any amounts appropriated pursuant to
this subsection shall remain available until expended.’’.
AUTHORIZATION OF APPROPRIATIONS FOR HOUSING
OPPORTUNITIES FOR PERSONS WITH AIDS
SEC. 425. Section 863 of the Cranston-Gonzalez Na-
tional Affordable Housing Act (42 U.S.C. 12912), is
amended to read as follows:
‘‘SEC. 863. AUTHORIZATION OF APPROPRIATIONS.
‘‘There are authorized to be appropriated to carry out
this subtitle $156,000,000 for fiscal year 1995 and
$156,000,000 for fiscal year 1996.’’.
TITLE V—PRESERVATION AND PRODUCTION
MISCELLANEOUS AMENDMENTS TO LIHPRHA
SEC. 501. (a) ESTABLISH A REALISTIC FEDERAL
COST LIMIT.—(1) Section 215(a) of the Low-Income
Housing Preservation and Resident Homeownership Act
of 1990 is amended—
(A) in paragraph (1), by striking ‘‘120’’ and in-
serting ‘‘100’’;
(B) by striking paragraph (2); and
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(C) by redesignating paragraph (3) as para-
graph (2) and amending such paragraph by striking
‘‘and the amount determined under paragraph (2)’’.
(2) Section 215(b)(2)(C) is amended to read as fol-
lows:
‘‘(C) file a second notice of intent under section
216(d) to terminate the low-income affordability re-
strictions through payment of the mortgage or vol-
untary termination of the insurance contract, subject
to compliance with the provisions of section 223.’’.
(3)(A) Section 221 is hereby repealed.
(B)(i) Section 213(b)(2), section 214(b)(2), the sec-
ond sentence of section 217(a)(1), sections 224(a)(1) (B)
and (C), and section 224(a)(2) of such Act are each
amended by striking ‘‘or 221’’.
(ii) The third sentence of section 214(b) of such Act
is amended by striking ‘‘219, 220, or 221’’ and inserting
‘‘219 or 220’’.
(iii) The third sentence of section 216(d)(1) of such
Act is amended by striking ‘‘sections 221 and 223’’ and
inserting ‘‘section 223’’.
(iv) The second sentence of section 217(a)(1) of such
Act is amended by striking ‘‘or upon making of any bona
fide offer under section 221’’.
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(v) The last sentence of section 224(a) of such Act
is amended by striking ‘‘sections 220 and 221’’ and insert-
ing ‘‘section 220’’.
(vi) Section 229 (8)(B) of such Act is amended by
striking ‘‘and 221’’.
(b) CAP APPRAISALS UNDER LIHPRHA AT FAIR
MARKET VALUE FOR RESIDENTIAL RENTAL USE.—Sec-
tion 213(b)(2) of such Act is amended by inserting before
the period the following: ‘‘as residential rental housing’’.
(c) REPEAL OF HOMEOWNERSHIP ASSISTANCE.—(1)
Section 220(d)(1) of such Act is amended to read as fol-
lows:
‘‘(1) APPROVAL.—The Secretary may not ap-
prove a plan for any qualified purchaser unless the
Secretary finds that the criteria for approval under
section 222 have been satisfied.’’.
(2) The matter preceding subparagraph (A) in sec-
tion 220(d)(2) of such Act is amended by striking ‘‘(in-
cluding all priority purchasers other than resident councils
acquiring under the homeownership program authorized
by section 226)’’.
(3) Section 220(d)(2)(G) of such Act is amended to
read as follows:
‘‘(G) in the case of a resident council orga-
nized to acquire the housing as a limited equity
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cooperative, cover the costs of training for the
resident council and of ownership counseling
and training.’’.
(4) Section 222(a) of such Act is amended by striking
out ‘‘(other than a resident council)’’.
(5) Section 222(a)(2)(A) of such Act is amended by
inserting ‘‘rental or limited equity cooperative’’ imme-
diately after ‘‘the housing will be retained as’’.
(6) Section 226 of such Act is hereby repealed.
(7) Section 231(a) of such Act is amended by—
(A) striking out ‘‘(A)’’ and all that follows
through ‘‘(B)’’; and
(B) inserting after ‘‘any nonprofit organiza-
tion’’ the following: ‘‘(including a resident council)’’.
(d) NATIONAL HOUSING ACT CONFORMING AMEND-
MENT.—Section 241(f)(3)(A) of the National Housing Act
is amended by striking out ‘‘or 221’’.
(e) 
TRANSITION
PROVISION.—The 
amendments
made by this section shall only apply to eligible owners
that file a plan of action under the Low-Income Housing
Preservation and Resident Homeownership Act of 1990
on or after the date of enactment of this Act.
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LOW-INCOME HOUSING PRESERVATION
AUTHORIZATION OF APPROPRIATIONS
SEC. 502. Section 234(a) of the Housing and Com-
munity Development Act of 1987 (12 U.S.C. 4124) is
amended to read as follows:
‘‘(a) IN GENERAL.—There are authorized to be ap-
propriated for assistance and incentives authorized under
this subtitle $226,000,000 for fiscal year 1996.’’.
FHA FUND SUPPORT OF SECTION 8 ASSISTANCE FOR
PROPERTY DISPOSITION
SEC. 503. (a) Section 203 of the Housing and Com-
munity Development Amendments of 1978 is amended by
adding the following new subsection at the end thereof:
‘‘(m) SPENDING AUTHORITY FOR SECTION 8 ASSIST-
ANCE.—In addition to amounts otherwise made available
for carrying out subsections (e) and (f) of this section,
the Secretary shall use not to exceed a total of
$3,945,000,000 for fiscal years 1995 through 1999 for as-
sistance under section 8 of the United States Housing Act
of 1937, as authorized by subsections (e) and (f). These
funds are hereby made available from amounts in the Gen-
eral Insurance Fund or the Special Risk Insurance Fund,
as appropriate.’’.
(b) Section 207(l) of the National Housing Act is
amended by adding in the first sentence after ‘‘or sell for
cash or credit or lease in his discretion,’’ the following:
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‘‘with or without provision for rental assistance that may
be either project-based or tenant-based,’’.
HOME PROGRAM LOAN GUARANTEES
SEC. 504. HOME PROGRAM LOAN GUARANTEES.—
Title II of the Cranston-Gonzalez National Affordable
Housing Act (the Home Investment Partnership Act) is
amended by adding the following new section at the end
of subtitle A:
‘‘SEC. 227. LOAN GUARANTEES.
‘‘(a) The Secretary is authorized, upon such terms
and conditions as the Secretary may prescribe, to guaran-
tee and make commitments to guarantee, only to such ex-
tent or in such amounts as provided in appropriation Acts,
the notes or other obligations issued by eligible participat-
ing jurisdictions or by public agencies designated by and
acting on behalf of eligible participating jurisdictions for
purposes of financing (including credit enhancements and
debt service reserves) the acquisition, new construction,
reconstruction, or moderate or substantial rehabilitation
of affordable housing, including real property acquisition,
site improvement, conversion, demolition, and other ex-
penses, including financing costs, relocation expenses of
any displaced persons, families, businesses, or organiza-
tions. All housing funded under this section shall meet the
requirements of this title.
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‘‘(b) Notes or other obligations guaranteed under this
section shall be in such form and denominations, have
such maturities, and be subject to such conditions as may
be prescribed by regulations issued by the Secretary. The
Secretary may not deny a guarantee under this section
on the basis of the proposed repayment period for the note
or other obligation, unless the period is more than 20
years or the Secretary determines that the period other-
wise causes the guarantee to constitute an unacceptable
financial risk. To the extent provided in appropriation
Acts, the Secretary may enter into commitments to guar-
antee notes or other obligations under this section with
an aggregate principal amount of $1,000,000,000 for fis-
cal year 1995 and $1,000,000,000 for fiscal year 1996.
‘‘(c) No guarantee or commitment to guarantee shall
be made with respect to any note or other obligation if
the total outstanding notes or obligations guaranteed
under this section on behalf of a participating jurisdiction
(excluding any amount defeased under a contract entered
into under subsection (e)(1)) would thereby exceed an
amount equal to 5 times the amount of the participating
jurisdiction’s latest HOME allocation.
‘‘(d) Notwithstanding any other provision of this title,
funds allocated to the participating jurisdiction under this
title (including program income derived therefrom) are au-
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thorized for use by the participating jurisdiction or by the
Secretary, in the payment of principal and interest due
on the notes or other obligations guaranteed pursuant to
this section and the payment of such servicing, underwrit-
ing, or other issuance or collection charges as may be spec-
ified in regulations issued by the Secretary.
‘‘(e) To assure the full repayment of notes or other
obligations guaranteed hereunder as well as the issuance
or collection charges specified by the Secretary under
paragraph (d), and as a prior condition for receiving such
guarantees, the Secretary shall require the participating
jurisdiction (and its designated public agency issuer, if
any) to—
‘‘(1) enter into a contract, in a form acceptable
to the Secretary, for repayment of such notes or
other obligations and the other specified charges;
‘‘(2) pledge as security for such repayment any
allocation for which the participating jurisdiction
may become eligible under this title; and
‘‘(3) furnish, at the discretion of the Secretary,
such other security as may be deemed appropriate
by the Secretary in making such guarantees, which
may include increments in local tax receipts gen-
erated by the housing assisted under this section or
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disposition proceeds from the sale of land or hous-
ing.
‘‘(f) The Secretary is authorized, notwithstanding
any other provision of this title or any other Federal, State
or local law, to apply allocations pledged pursuant to para-
graph (e) of this section to any repayments due the United
States as a result of such guarantees.
‘‘(g) The full faith and credit of the United States
is pledged to the payment of all guarantees made under
this section. Any such guarantee made by the Secretary
shall be conclusive evidence of the eligibility of the notes
or other obligations for such guarantee with respect to
principal and interest, and the validity of any such guar-
antee so made shall be incontestable in the hands of a
holder of the guaranteed obligations.
‘‘(h) Obligations guaranteed under this section shall
be subject to Federal taxation as provided in subsection
(j).
‘‘(i) With respect to any obligation guaranteed pursu-
ant to this section, the interest paid on such obligation
shall be included in gross income for the purpose of chap-
ter 1 of the Internal Revenue Code of 1954.
‘‘(j) The Secretary shall monitor the use of guaran-
tees under this section by eligible participating jurisdic-
tions. If the Secretary finds that 50 percent of the aggre-
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gate guarantee authority has been committed, the Sec-
retary may—
‘‘(1) impose limitations on the amount of guar-
antees any one participating jurisdiction may receive
in any fiscal year of $35,000,000; or
‘‘(2) request the enactment of legislation in-
creasing the aggregate limitation on guarantees
under this section.
‘‘(k) No fee or other charge may be imposed by the
Secretary or any other Federal agency on or with respect
to a guarantee made by the Secretary under this section.
‘‘(l)(1) The Secretary is authorized, upon such terms
and conditions as the Secretary deems appropriate, to
guarantee the timely payment of the principal of and in-
terest on such trust certificates or other obligations as
shall—
‘‘(A) be offered by the Secretary or by any
other offeror approved for purposes of this sub-
section by the Secretary, and
‘‘(B) be based on and backed by a trust or pool
composed of notes or other obligations guaranteed or
eligible for guarantee by the Secretary under this
section.
‘‘(2) To the same extent as provided in paragraph
(g), the full faith and credit of the United States is
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pledged to the payment of all amounts which may be re-
quired to be paid under any guarantee by the Secretary
under this subsection.
‘‘(3) In the event the Secretary pays a claim under
a guarantee issued under this section, the Secretary shall
be subrogated fully to the rights satisfied by such pay-
ment.
‘‘(4) No State or local law, and no Federal law, shall
preclude or limit the exercise by the Secretary of—
‘‘(A) the power to contract with respect to pub-
lic offerings and other sales of notes, trust certifi-
cates and other obligations guaranteed under this
section upon such terms and conditions as the Sec-
retary deems appropriate,
‘‘(B) the right to enforce by any means deemed
appropriate by the Secretary any such contract, and
‘‘(C) The Secretary’s ownership rights, as appli-
cable, in notes, certificates or other obligations guar-
anteed under this section, or constituting the trust
or pool against which trust certificates or other obli-
gations guaranteed under this section are offered.
‘‘(m) There are authorized to be appropriated such
sums as may be necessary for each of fiscal years 1995
and 1996 for the cost to the Government, as defined in
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TITLE VI—EXPANSION OF FAIR HOUSING
METROPOLITAN AREAWIDE STRATEGY DEMONSTRATION
SEC. 601. (a) The Secretary of Housing and Urban
Development shall carry out, through consortia of units
of general local government, a demonstration that makes
assisted housing available in three metropolitan areas on
a metropolitan, areawide basis. The demonstration shall
be designed to determine how best to (1) affirmatively fur-
ther fair housing and address the problem or racial seg-
regation in metropolitan areas; (2) achieve the goal of
overcoming racial spatial separation and segregation, in-
cluding testing the effect of filling vacancies in assisted
housing by use of a consolidated waiting list; (3) enlist
cooperation by units of general local government, public
housing agencies, and private owners of assisted housing
in achieving such goals; (4) make public housing a path
to social and economic mobility; (5) eliminate housing dis-
crimination; and (6) accomplish related objectives, as de-
termined by the Secretary.
(b) The Secretary shall select the consortia on a com-
petitive basis and make a grant to each consortia selected
to carry out the demonstration. An application shall dem-
onstrate that a sufficient number of units of general local
government, public housing agencies, and private owners
of assisted housing are committed to participate in the
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demonstration to make the demonstration feasible, includ-
ing commitments to comply with alternative program re-
quirements specified by the Secretary. The demonstration
shall have a three-year term with respect to each site.
(c) The Secretary may waive, or specify alternative
requirements for, any provision of any statute or regula-
tion that the Secretary administers upon finding that the
waiver or alternative requirement (1) is necessary to facili-
tate the demonstration, and (2) would not be inconsistent
with the overall purpose of the statute or regulation af-
fected. In no event may the Secretary waive, or specify
alternative requirements for, statutory requirements relat-
ed to nondiscrimination, fair housing, labor standards, or
the environment, except that the Secretary may waive af-
firmative marketing requirements for participants in the
demonstration.
(d) There are authorized to be appropriated for the
costs related to regional planning, housing counseling, de-
velopment of a model consolidated waiting list, and admin-
istration under the demonstration established by this sec-
tion, $15,000,000 for each of fiscal years 1995, 1996, and
1997. Of the amounts appropriated for annual contribu-
tions for assisted housing under the United States Hous-
ing Act of 1937, the Secretary shall earmark $9,000,000
for each of fiscal years 1995, 1996, and 1997 for mod-