260
entities in the jurisdiction in which the public housing is
located. The assessment team shall provide to the Secretary
and the public housing agency or manager a written report,
which shall contain, at a minimum, recommendations for
such management improvements as are necessary to elimi-
nate or substantially remedy existing deficiencies.
SEC. 535. ADMINISTRATION.
(a) PHA’S.—The Secretary shall carry out this sub-
title with respect to public housing agencies substantially
in the same manner as the public housing management as-
sessment system under section 6(j) of the United States
Housing Act of 1937 (as in effect immediately before the
effective date of the repeal under section 601(b) of this Act)
was required to be carried out with respect to public hous-
ing agencies. The Secretary may comply with the require-
ments under this subtitle by using any regulations issued
to carry out such system and issuing any additional regula-
tions necessary to make such system comply with the re-
quirements under this subtitle.
(b) OTHER MANAGERS.—The Secretary shall establish
specific standards and procedures for carrying out this sub-
title with respect to managers of public housing that are
not public housing agencies. Such standards and procedures
shall take in consideration special circumstances relating
261
to entities hired, directed, or appointed to manage public
housing.
Subtitle 
D—Accountability 
and
Oversight Standards and Proce-
dures
SEC. 541. AUDITS.
(a) BY SECRETARY AND COMPTROLLER GENERAL.—
Each block grant contract under section 201 and each con-
tract for housing assistance amounts under section 302
shall provide that the Secretary, the Inspector General of
the Department of Housing and Urban Development, and
the Comptroller General of the United States, or any of
their duly authorized representatives, shall, for the purpose
of audit and examination, have access to any books, docu-
ments, papers, and records of the public housing agency (or
other entity) entering into such contract that are pertinent
to this Act and to its operations with respect to financial
assistance under the this Act.
(b) BY PHA.—
(1) REQUIREMENT.—Each public housing agency
that owns or operates 250 or more public housing
dwelling units and receives assistance under this Act
shall have an audit made in accordance with chapter
75 of title 31, United States Code. The Secretary, the
Inspector General of the Department of Housing and
262
Urban Development, and the Comptroller General of
the United States shall have access to all books, docu-
ments, papers, or other records that are pertinent to
the activities carried out under this Act in order to
make audit examinations, excerpts, and transcripts.
(2) WITHHOLDING OF AMOUNTS.—The Secretary
may, in the sole discretion of the Secretary, arrange
for, and pay the costs of, an audit required under
paragraph (1). In such circumstances, the Secretary
may withhold, from assistance otherwise payable to
the agency under this Act, amounts sufficient to pay
for the reasonable costs of conducting an acceptable
audit, including, when appropriate, the reasonable
costs of accounting services necessary to place the
agency’s books and records in auditable condition.
SEC. 542. PERFORMANCE AGREEMENTS FOR AUTHORITIES
AT RISK OF BECOMING TROUBLED.
(a) IN GENERAL.—Upon designation of a public hous-
ing agency as at risk of becoming troubled under section
533(c), the Secretary shall seek to enter into an agreement
with the agency providing for improvement of the elements
of the agency that have been identified. An agreement under
this section shall contain such terms and conditions as the
Secretary determines are appropriate for addressing the ele-
263
ments identified, which may include an on-site, independ-
ent assessment of the management of the agency.
(b) POWERS OF SECRETARY.—If the Secretary deter-
mines that such action is necessary to prevent the public
housing agency from becoming a troubled agency, the Sec-
retary may—
(1) solicit competitive proposals from other pub-
lic housing agencies and private housing management
agents (which may be selected by existing tenants
through administrative procedures established by the
Secretary), for any case in which such agents may be
needed for managing all, or part, of the housing or
functions administered by the agency; or
(2) solicit competitive proposals from other pub-
lic housing agencies and private entities with experi-
ence in construction management, for any case in
which such authorities or firms may be needed to
oversee implementation of assistance made available
for capital improvement for public housing of the
agency.
SEC. 543. PERFORMANCE AGREEMENTS AND CDBG SANC-
TIONS FOR TROUBLED PHA’S.
(a) IN GENERAL.—Upon designation of a public hous-
ing agency as a troubled agency under section 533(a) and
after reviewing the report submitted pursuant to section
264
534(c) and consulting with the assessment team for the
agency under section 534, the Secretary shall seek to enter
into an agreement with the agency providing for improving
the management performance of the agency.
(b) CONTENTS.—An agreement under this section be-
tween the Secretary and a public housing agency shall set
forth—
(1) targets for improving performance, as meas-
ured by the guidelines and standards established
under section 532 and other requirements within a
specified period of time, which shall include targets to
be met upon the expiration of the 12-month period be-
ginning upon entering into the agreement;
(2) strategies for meeting such targets;
(3) sanctions for failure to implement such strat-
egies; and
(4) to the extent the Secretary deems appro-
priate, a plan for enhancing resident involvement in
the management of the public housing agency.
(c) LOCAL ASSISTANCE
IN IMPLEMENTATION.—The
Secretary and the public housing agency shall, to the maxi-
mum extent practicable, seek the assistance of local public
and private entities in carrying out an agreement under
this section.
265
(d) DEFAULT UNDER PERFORMANCE AGREEMENT.—
Upon the expiration of the 12-month period beginning upon
entering into an agreement under this section with a public
housing agency, the Secretary shall review the performance
of the agency in relation to the performance targets and
strategies under the agreement. If the Secretary determines
that the agency has failed to comply with the performance
targets established for such period, the Secretary shall take
the action authorized under subsection (b)(2) or (b)(5) of
section 545.
(e) CDBG SANCTION AGAINST LOCAL GOVERNMENT
CONTRIBUTING TO TROUBLED STATUS OF PHA.—If the
Secretary determines that the actions or inaction of any
unit of general local government within which any portion
of the jurisdiction of a public housing agency is located has
substantially contributed to the conditions resulting in the
agency being designated under section 533(a) as a troubled
agency, the Secretary may redirect or withhold, from such
unit of general local government any amounts allocated for
such unit under section 106 of the Housing and Community
Development Act of 1974.
SEC. 544. OPTION TO DEMAND CONVEYANCE OF TITLE TO
OR POSSESSION OF PUBLIC HOUSING.
(a) AUTHORITY FOR CONVEYANCE.—A contract under
section 201 for block grants under title II (including con-