was originally established to comply with this section and
updating and improving such clearinghouse to the extent
necessary to comply with the requirements of this section
as in effect pursuant to the enactment of such Act.’’.
TITLE 
II—HOMEOWNERSHIP
THROUGH MORTGAGE INSUR-
ANCE AND LOAN GUARAN-
TEES
SEC. 201. STUDY OF MANDATORY INSPECTION REQUIRE-
MENT 
UNDER 
SINGLE 
FAMILY 
HOUSING
MORTGAGE INSURANCE PROGRAM.
The Comptroller General of the United States shall
conduct a study regarding the inspection of properties
purchased with loans insured under section 203 of the Na-
tional Housing Act. The study shall evaluate the following
issues:
(1) The feasibility of requiring inspections of all
properties purchased with loans insured under such
section.
(2) The level of financial losses or savings to
the Mutual Mortgage Insurance Fund that are likely
to occur if inspections are required on properties
purchased with loans insured under such section.
(3) The potential impact on the process of buy-
ing a home if inspections of properties purchased
with loans insured under such section are required,
including the process of buying a home in under-
served areas where losses to the Mutual Mortgage
Insurance Fund are greatest.
(4) The difference, if any, in the quality of
homes purchased with loans insured under such sec-
tion that are inspected before purchase and such
homes that are not inspected before purchase.
(5) The cost to homebuyers of requiring inspec-
tions before purchase of properties with loans in-
sured under such section.
(6) The extent, if any, to which requiring in-
spections of properties purchased with loans insured
under such section will result in adverse selection of
loans insured under such section.
(7) The extent of homebuyer knowledge regard-
ing property inspections and the extent to which
such knowledge affects the decision of homebuyers
to opt for or against having a property inspection
before purchasing a home.
Not later than the expiration of the 1-year period be-
ginning on the date of the enactment of this Act, the
Comptroller General shall submit to the Congress a report
containing the results of the study and any recommenda-
tions with respect to the issues specified under this sec-
tion.
SEC. 202. EXTENSION OF LOAN TERM FOR MANUFACTURED
HOME LOTS.
Section 2(b)(3)(E) of the National Housing Act (12
U.S.C. 1703(b)(3)(E)) is amended by striking ‘‘fifteen’’
and inserting ‘‘twenty’’.
SEC. 203. NEIGHBORHOOD TEACHER PROGRAM.
(a) SHORT TITLE.—This section may be cited as the
‘‘Neighborhood Teachers Act’’.
(b) CONGRESSIONAL FINDINGS.—The Congress finds
that—
(1) teachers are an integral part of our commu-
nities;
(2) other than families, teachers are often the
most important mentors to children, providing them
with the values and skills for self-fulfillment in adult
life; and
(3) the Neighborhood Teachers Act recognizes
the value teachers bring to community and family
life and is designed to encourage and reward teach-
ers that serve in our most needy communities.
(c) DISCOUNT AND DOWNPAYMENT ASSISTANCE FOR
TEACHERS.—Section 204(h) of the National Housing Act
(12 U.S.C. 1710(h)) is amended—
(1) by redesignating paragraphs (7) through
(10) as paragraphs (8) through (11), respectively;
and
(2) by inserting after paragraph (6) the fol-
lowing new paragraph:
‘‘(7) 50 PERCENT
DISCOUNT
FOR
TEACHERS
PURCHASING PROPERTIES THAT ARE ELIGIBLE AS-
SETS.—
‘‘(A) DISCOUNT.—A property that is an el-
igible asset and is sold, during fiscal years 2000
through 2004, to a teacher for use in accord-
ance with subparagraph (B) shall be sold at a
price that is equal to 50 percent of the ap-
praised value of the eligible property (as deter-
mined in accordance with paragraph (6)(B)). In
the case of a property eligible for both a dis-
count under this paragraph and a discount
under paragraph (6), the discount under para-
graph (6) shall not apply.
‘‘(B) PRIMARY
RESIDENCE.—An eligible
property sold pursuant to a discount under this
paragraph shall be used, for not less than the
3-year period beginning upon such sale, as the
primary residence of a teacher.
‘‘(C) SALE METHODS.—The Secretary may
sell an eligible property pursuant to a discount
under this paragraph—
‘‘(i) to a unit of general local govern-
ment or nonprofit organization (pursuant
to paragraph (4) or otherwise), for resale
or transfer to a teacher; or
‘‘(ii) directly to a purchaser who is a
teacher.
‘‘(D) RESALE.—In the case of any pur-
chase by a unit of general local government or
nonprofit organization of an eligible property
sold at a discounted price under this paragraph,
the sale agreement under paragraph (8) shall—
‘‘(i) require the purchasing unit of
general local government or nonprofit or-
ganization to provide the full benefit of the
discount to the teacher obtaining the prop-
erty; and
‘‘(ii) in the case of a purchase involv-
ing multiple eligible assets, any of which is
such an eligible property, designate the
specific eligible property or properties to be
subject to the requirements of subpara-
graph (B).
‘‘(E) MORTGAGE
DOWNPAYMENT
ASSIST-
ANCE.—If a teacher purchases an eligible prop-
erty pursuant to a discounted sale price under
this paragraph and finances such purchase
through a mortgage insured under this title,
notwithstanding any provision of section 203
the downpayment on such mortgage shall be
$100.
‘‘(F) PREVENTION OF UNDUE PROFIT.—
The Secretary shall issue regulations to prevent
undue profit from the resale of eligible prop-
erties in violation of the requirement under sub-
paragraph (B).
‘‘(G) AWARENESS PROGRAM.—From funds
made available for salaries and expenses for the
Office of Policy Support of the Department of
Housing and Urban Development, each field of-
fice of the Department shall make available to
elementary schools and secondary schools with-
in the jurisdiction of the field office and to the
public—
‘‘(i) a list of eligible properties located
within the jurisdiction of the field office
that are available for purchase by teachers
under this paragraph; and
‘‘(ii) other information designed to
make such teachers and the public aware
of the discount and downpayment assist-
ance available under this paragraph.
‘‘(H) DEFINITIONS.—For the purposes of
this paragraph, the following definitions shall
apply:
‘‘(i) The terms ‘elementary school’
and ‘secondary school’ have the meaning
given such terms in section 14101 of the
Elementary and Secondary Education Act
of 1965 (20 U.S.C. 8801).
‘‘(ii) The term ‘eligible property’
means an eligible asset described in para-
graph (2)(A) of this subsection.
‘‘(iii) The term ‘teacher’ means an in-
dividual who is employed on a full-time
basis as a teacher in an elementary or sec-
ondary school.’’.
(d) CONFORMING AMENDMENTS.—Section 204(h) of
the National Housing Act (12 U.S.C. 1710(h)) is
amended—
(1) in paragraph (4)(B)(ii), by striking ‘‘para-
graph (7)’’ and inserting ‘‘paragraph (8)’’;
(2) in paragraph (5)(B)(i), by striking ‘‘para-
graph (7)’’ and inserting ‘‘paragraph (8)’’; and
(3) in paragraph (6)(A), by striking ‘‘paragraph
(8)’’ and inserting ‘‘paragraph (9)’’.
(e) REGULATIONS.—Not later than 90 days after the
date of the enactment of this Act, the Secretary shall issue
regulations to implement the amendments made by this
section.
SEC. 204. INSURANCE FOR MORTGAGES TO REFINANCE EX-
ISTING HOME EQUITY CONVERSION MORT-
GAGES.
(a) IN GENERAL.—Section 255 of the National
Housing Act (12 U.S.C. 1715z–20) is amended—
(1) by redesignating subsection (k) as sub-
section (l); and
(2) by inserting after subsection (j) the fol-
lowing new subsection:
‘‘(k) INSURANCE AUTHORITY FOR REFINANCINGS.—
‘‘(1) IN GENERAL.—The Secretary may, upon
application by a mortgagee, insure under this sub-
section any mortgage given to refinance an existing
home equity conversion mortgage insured under this
section.
‘‘(2) APPLICABILITY OF REQUIREMENTS.—The
provisions of this section shall apply to the insurance
of mortgages under this subsection, except that the
requirements under subsection (d)(2)(B) (relating to
third party counseling) shall not apply to mortgages
insured under this subsection.
‘‘(3) REDUCED UP-FRONT PREMIUM.—Notwith-
standing section 203(c)(2)(A), the single premium
payment collected at the time of insurance of a
mortgage under this subsection shall be an amount
not 
exceeding 
2.0 
percent 
of 
the 
difference
between—
‘‘(A) the maximum amount of insurance
benefits payable under subsection (i)(1)(C)
under the mortgage insured under this sub-
section; and
‘‘(B) the maximum amount of insurance
benefits payable under subsection (i)(1)(C)
under the home equity conversion mortgage
that is refinanced and insured under this sub-
section.
‘‘(4) REFUND
OF
ORIGINAL
UP-FRONT
PRE-
MIUM.—If, in insuring a mortgage under this sub-
section, the Secretary provides to the mortgagor a
refund of the full amount of any premium paid in
connection with the existing home equity mortgage
refinanced under the insured mortgage, paragraph
(3) shall not apply and the Secretary shall collect at
the time of insurance a single premium payment in
accordance with the procedures otherwise applicable
to mortgage insurance under this section.’’.
(b) REGULATIONS.—The Secretary shall issue any
final regulations necessary to implement the amendments
made by subsection (a), which shall take effect not later
than the expiration of the 90-day period beginning on the
date of the enactment of this Act. The regulations shall
be issued after notice and opportunity for public comment
in accordance with the procedure under section 553 of title
5, United States Code, applicable to substantive rules
(notwithstanding subsections (a)(2), (b)(B), and (d)(3) of
such section).
SEC. 205. REPORT ON TITLE I HOME IMPROVEMENT LOAN
PROGRAM.
(a) IN GENERAL.—Not later than 1 year after the
date of the enactment of this Act, the Secretary of Hous-
ing and Urban Development shall submit a report to the
Congress containing recommendations for improvements
to the property improvement loan insurance program
under title I of the National Housing Act, including im-
provements designed to address problems relating to home
improvement contractors obtaining loans on behalf of
homeowners.
(b) CONSULTATION.—In developing and determining
recommendations for inclusion in the report under this
section and in preparing the report, the Secretary shall
consult with interested persons, organizations, and enti-
ties, including representatives of the lending industry and
consumer organizations.
TITLE III—SECTION 8
HOMEOWNERSHIP OPTION
SEC. 301. DOWNPAYMENT ASSISTANCE.
(a) AMENDMENTS.—Section 8(y) of the United
States Housing Act of 1937 (42 U.S.C. 1437f(y)) is
amended—
(1) by redesignating paragraph (7) as para-
graph (8); and
(2) by inserting after paragraph (6) the fol-
lowing new paragraph:
‘‘(7) DOWNPAYMENT ASSISTANCE.—
‘‘(A) AUTHORITY.—A public housing agen-
cy may, in lieu of providing monthly assistance
payments under this subsection on behalf of a
family eligible for such assistance and at the
discretion of the public housing agency, provide
assistance for the family in the form of a single
grant to be used only as a contribution toward
the downpayment required in connection with
the purchase of a dwelling for fiscal year 2000
and each fiscal year thereafter to the extent
provided in advance in appropriations Acts.
‘‘(B) AMOUNT.—The amount of a down-
payment grant on behalf of an assisted family
may not exceed the amount that is equal to the
sum of the assistance payments that would be
made during the first year of assistance on be-
half of the family, based upon the income of the
family at the time the grant is to be made.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall take effect immediately after the
amendments made by section 555(c) of the Quality Hous-
ing and Work Responsibility Act of 1998 take effect pur-
suant to such section.
TITLE IV—COMMUNITY
DEVELOPMENT BLOCK GRANTS
SEC. 401. REAUTHORIZATION.
The last sentence of section 103 of the Housing and
Community Development Act of 1974 (42 U.S.C. 5303)
is amended to read as follows: ‘‘For purposes of assistance
under section 106, there is authorized to be appropriated
$4,750,000,000 for fiscal year 2000 and such sums as
may be necessary for each of fiscal years 2001, 2002,
2003, and 2004.’’.
SEC. 402. PROHIBITION OF SET-ASIDES.
Section 103 of the Housing and Community Develop-
ment Act of 1974 (42 U.S.C. 5303), as amended by sec-
tion 401 of this Act, is further amended—
(1) by inserting after ‘‘SEC. 103.’’ the fol-
lowing: ‘‘(a) IN GENERAL.—’’; and
(2) by adding at the end the following new sub-
section:‘‘
‘‘(b) PROHIBITION OF SET-ASIDES.—Except as pro-
vided in paragraphs (1) and (2) of section 106(a) and sec-
tion 107, amounts appropriated pursuant to subsection (a)
of this section or otherwise to carry out this title (other
than section 108) shall be used only for formula-based
grants allocated pursuant to section 106 and may not be
otherwise used unless the provision of law providing for
such other use specifically refers to this subsection and
specifically states that such provision modifies or super-
sedes the provisions of this subsection.’’.
SEC. 403. HOMEOWNERSHIP FOR MUNICIPAL EMPLOYEES.
(a) ELIGIBLE ACTIVITIES.—Section 105(a) of the
Housing and Community Development Act of 1974 (42
U.S.C. 5305(a)) is amended—
(1) in paragraph (22)(C), by striking ‘‘and’’ at
the end;
(2) in paragraph (23), by striking the period at
the end and inserting a semicolon; and
(3) by inserting after paragraph (23) the fol-
lowing new paragraph:
‘‘(24) provision of direct assistance to facilitate
and expand homeownership among uniformed em-
ployees (including policemen, firemen, and sanitation
and other maintenance workers) of, and teachers
who are employees of, the metropolitan city or urban
county (or an agency or school district serving such
city or county) receiving grant amounts under this
title pursuant to section 106(b) or the unit of gen-
eral local government (or an agency or school dis-
trict serving such unit) receiving such grant
amounts pursuant to section 106(d); except that,
notwithstanding section 102(a)(20)(B) or any other
provision of this title, such assistance may be pro-
vided on behalf of such employees whose family in-
comes do not exceed 115 percent of the median in-
come of the area involved, as determined by the Sec-
retary with adjustments for smaller and larger fami-
lies; and except that such assistance shall be used
only for acquiring principal residences for such em-
ployees by—
‘‘(A) providing amounts for downpayments
on mortgages;
‘‘(B) paying reasonable closing costs nor-
mally associated with the purchase of a resi-
dence;
‘‘(C) obtaining pre- or post-purchase coun-
seling relating to the financial and other obliga-
tions of homeownership; or
‘‘(D) subsidizing mortgage interest rates;’’.
(b) PRIMARY OBJECTIVES.—Section 105(c) of the
Housing and Community Development Act of 1974 (42
U.S.C. 5305(c)) is amended by adding at the end the fol-
lowing new paragraph:
‘‘(5) HOMEOWNERSHIP ASSISTANCE FOR MUNICIPAL
EMPLOYEES.—Notwithstanding any other provision of this
title, any assisted activity described in subsection (a)(24)
of this section shall be considered, for purposes of this
title, to benefit persons of low and moderate income and
to be directed toward the objective under section
101(c)(3).’’.
SEC. 
404. 
TECHNICAL 
AMENDMENT 
RELATING 
TO
BROWNFIELDS.
Section 105(a) of the Housing and Community De-
velopment Act of 1974 (42 U.S.C. 5305(a)), as amended
by section 403 of this Act, is further amended—
(1) in paragraph (25), by striking the period
and inserting ‘‘; and’’; and
(2) by adding at the end the following new
paragraph:
‘‘(26) environmental cleanup and economic de-
velopment activities related to Brownfields projects
in conjunction with the appropriate environmental
regulatory agencies.’’.
SEC. 405. HOUSING OPPORTUNITIES FOR PERSONS WITH
AIDS.
Section 863 of the Cranston-Gonzalez National Af-
fordable Housing Act (42 U.S.C. 12912) is amended to
read as follows:
‘‘SEC. 863. AUTHORIZATION OF APPROPRIATIONS.
‘‘There is authorized to be appropriated to carry out
this subtitle $215,000,000 for fiscal year 2000 and such
sums as may be necessary for each of fiscal years 2001,
2002, 2003, and 2004.’’.
TITLE V—HOME INVESTMENT
PARTNERSHIPS PROGRAM
SEC. 501. REAUTHORIZATION.
Section 205 of the Cranston-Gonzalez National Af-
fordable Housing Act (42 U.S.C. 12724) is amended to
read as follows:
‘‘SEC. 205. AUTHORIZATION.
‘‘(a) IN GENERAL.—There is authorized to be appro-
priated to carry out this title $1,600,000,000 for fiscal
year 2000 and such sums as may be necessary for each
of fiscal years 2001, 2002, 2003, and 2004, of which—
‘‘(1) not more than $25,000,000 in each such
fiscal year shall be for community housing partner-
ship activities authorized under section 233; and
‘‘(2) not more than $15,000,000 in each such
fiscal year shall be for activities in support of State
and local housing strategies authorized under sub-
title C.
‘‘(b) PROHIBITION OF SET-ASIDES.—Except as pro-
vided in subsection (a) of this section and section
217(a)(3), amounts appropriated pursuant to subsection
(a) of this section or otherwise to carry out this title shall
be used only for formula-based grants allocated pursuant
to section 217 and may not be otherwise used unless the
provision of law providing for such other use specifically
refers to this subsection and specifically states that such
provision modifies or supersedes the provisions of this sub-
section.’’.
SEC. 502. ELIGIBILITY OF LIMITED EQUITY COOPERATIVES
AND MUTUAL HOUSING ASSOCIATIONS.
(a) CONGRESSIONAL FINDINGS.—Section 202(10) of
the Cranston-Gonzalez National Affordable Housing Act
(42 U.S.C. 12721(10)) is amended by inserting ‘‘mutual
housing associations,’’ after ‘‘limited equity cooperatives,’’.
(b) DEFINITIONS.—Section 104 of the Cranston-
Gonzalez National Affordable Housing Act (42 U.S.C.
12704) is amended—
(1) by redesignating paragraph (23) as para-
graph (22);
(2) by redesignating paragraph (24) (relating to
the definition of ‘‘insular area’’) as paragraph (23);
and
(3) by adding at the end the following new
paragraphs:
‘‘(26) The term ‘limited equity cooperative’
means a cooperative housing corporation which, in a
manner determined by the Secretary to be accept-
able, restricts income eligibility of purchasers of
membership shares of stock in the cooperative cor-
poration or the initial and resale price of such
shares, or both, so that the shares remain available
and affordable to low-income families.
‘‘(27) The term ‘mutual housing association’
means a private entity that—
‘‘(A) is organized under State law;
‘‘(B) is described in section 501(c) of the
Internal Revenue Code of 1986 and exempt
from taxation under section 501(a) of such
Code;
‘‘(C) owns, manages, and continuously de-
velops affordable housing by providing long-
term housing for low- and moderate-income
families;
‘‘(D) provides that eligible families who
purchase membership interests in the associa-
tion shall have a right to residence in a dwelling
unit in the housing during the period that they
hold such membership interest; and
‘‘(E) provides for the residents of such
housing to participate in the ongoing manage-
ment of the housing.’’.
(c) ELIGIBILITY.—Section 215 of the Cranston-Gon-
zalez National Affordable Housing Act (42 U.S.C. 12745)
is amended—
(1) in subsection (b), by adding after and below
paragraph (4) the following:
‘‘Housing that is owned by a limited equity cooperative
or a mutual housing association may be considered by a
participating jurisdiction to be housing for homeownership
for purposes of this title to the extent that ownership or
membership in such a cooperative or association, respec-
tively, constitutes homeownership under State or local
laws.’’; and
(2) in subsection (a), by adding at the end the
following new paragraph:
‘‘(6) LIMITED EQUITY COOPERATIVES AND MU-
TUAL
HOUSING
ASSOCIATIONS.—Housing that is
owned by a limited equity cooperative or a mutual
housing association may be considered by a partici-
pating jurisdiction to be rental housing for purposes
of this title to the extent that ownership or member-
ship in such a cooperative or association, respec-
tively, constitutes rental of a dwelling under State or
local laws.’’.
SEC. 503. LEVERAGING AFFORDABLE HOUSING INVEST-
MENT THROUGH LOCAL LOAN POOLS.
(a) ELIGIBLE INVESTMENTS.—Section 212(b) of the
Cranston-Gonzalez National Affordable Housing Act (42
U.S.C. 12742(b)) is amended by inserting after ‘‘interest
subsidies’’ the following: ‘‘, advances to provide reserves
for loan pools or to provide partial loan guarantees,’’.
(b) TIMELY INVESTMENT OF TRUST FUNDS.—Sec-
tion 218(e) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12748) is amended to read as
follows:
‘‘(e) INVESTMENT WITHIN 15 DAYS.——
‘‘(1) IN GENERAL.—The participating jurisdic-
tion shall, not later than 15 days after funds are
drawn from the jurisdiction’s HOME Investment
Trust Fund, invest such funds, together with any in-
terest earned thereon, in the affordable housing for
which the funds were withdrawn.
‘‘(2) LOAN POOLS.—In the case of a partici-
pating jurisdiction that withdraws Trust Fund
amounts for investment in the form of an advance
for reserves or partial loan guarantees under a pro-
gram providing such credit enhancement for loans
for affordable housing, the amounts shall be consid-
ered to be invested for purposes of paragraph (1)
upon the completion of both of the following actions:
‘‘(A) Control of the amounts is transferred
to the program.
‘‘(B) The jurisdiction and the entity oper-
ating the program enter into a written agree-
ment that—
‘‘(i) provides that such funds may be
used only in connection with such program;
‘‘(ii) defines the terms and conditions
of the loan pool reserve or partial loan
guarantees; and
‘‘(iii) provides that such entity shall
ensure that amounts from non-Federal
sources have been contributed, or are com-
mitted for contribution, to the pool avail-
able for loans for affordable housing that
will be backed by such reserves or loan
guarantees in an amount equal to 10 times
the amount invested from Trust Fund
amounts.’’.
(c) EXPIRATION OF RIGHT TO WITHDRAW FUNDS.—
Section 218(g) of the Cranston-Gonzalez National Afford-
able Housing Act (42 U.S.C. 12748(g)) is amended to
read as follows:
‘‘(g) EXPIRATION OF RIGHT TO DRAW FUNDS.—
‘‘(1) IN
GENERAL.—If any funds becoming
available to a participating jurisdiction under this
title are not placed under binding commitment to af-
fordable housing within 24 months after the last day
of the month in which such funds are deposited in
the jurisdiction’s HOME Investment Trust Fund,
the jurisdiction’s right to draw such funds from the
HOME Investment Trust Fund shall expire. The
Secretary shall reduce the line of credit in the par-
ticipating jurisdiction’s HOME Investment Trust
Fund by the expiring amount and shall reallocate
the funds by formula in accordance with section
217(d).
‘‘(2) LOAN POOLS.—In the case of a partici-
pating jurisdiction that withdraws Trust Fund
amounts for investment in the manner provided
under subsection (e)(2), the amounts shall be consid-
ered to be placed under binding commitment to af-
fordable housing for purposes of paragraph (1) of
this subsection at the time that the amounts are ob-
ligated for use under, and are subject to, a written
agreement described in subsection (e)(2)(B).’’.
(d) TREATMENT OF MIXED INCOME LOAN POOLS AS
AFFORDABLE HOUSING.—
(1) IN GENERAL.—Section 215 of the Cran-
ston-Gonzalez National Affordable Housing Act (42
U.S.C. 12745) is amended by adding at the end the
following new subsection:
‘‘(c) LOAN POOLS.—Notwithstanding subsections (a)
and (b), housing financed using amounts invested as pro-
vided in section 218(e)(2) shall qualify as affordable hous-
ing only if the housing complies with the following require-
ments:
‘‘(1) In the case of housing that is for
homeownership—
‘‘(A) of the units financed with amounts so
invested—
‘‘(i) not less than 75 percent are prin-
cipal residences of owners whose families
qualify as low-income families—
‘‘(I) in the case of a contract to
purchase existing housing, at the time
of purchase;
‘‘(II) in the case of a lease-pur-
chase agreement for existing housing
or for housing to be constructed, at
the time the agreement is signed; or
‘‘(III) in the case of a contract to
purchase housing to be constructed, at
the time the contract is signed;
‘‘(ii) all are principal residences of
owners whose families qualify as moderate-
income families—
‘‘(I) in the case of a contract to
purchase existing housing, at the time
of purchase;
‘‘(II) in the case of a lease-pur-
chase agreement for existing housing
or for housing to be constructed, at
the time the agreement is signed; or
‘‘(III) in the case of a contract to
purchase housing to be constructed, at
the time the contract is signed; and
‘‘(iii) all comply with paragraphs (3)
and (4) of subsection (b), except that para-
graph (3) shall be applied for purposes of
this clause by substituting ‘subsection
(c)(2)(B)’ and ‘low- and moderate-income
homebuyers’ for ‘paragraph (2)’ and ‘low-
income homebuyers’, respectively; and
‘‘(B) units made available for purchase
only by families who qualify as low-income fam-
ilies shall have an initial purchase price that
complies with the requirements of subsection
(b)(1).
‘‘(2) In the case of housing that is for rental,
the housing—
‘‘(A) complies with subparagraphs (D)
through (F) of subsection (a)(1);
‘‘(B)(i) has not less than 75 percent of the
units occupied by households that qualify as
low-income families and is occupied only by
households that qualify as moderate-income
families; or
‘‘(ii) temporarily fails to comply with
clause (i) only because of increases in the in-
comes of existing tenants and actions satisfac-
tory to the Secretary are being taken to ensure
that all vacancies in the housing are being filled
in accordance with clause (i) until such non-
compliance is corrected; and
‘‘(C) bears rents, in the case of units made
available for occupancy only by households that
qualify as low-income families, that comply with
the requirements of subsection (a)(1)(A).
Paragraphs (4) and (5) of subsection (a) shall apply
to housing that is subject to this subsection.’’.
(2) DEFINITION.—Section 104 of the Cranston-
Gonzalez National Affordable Housing Act (42
U.S.C. 12704), as amended by section 502 of this
Act, is further amended by adding at the end the
following new paragraph:
‘‘(28) The term ‘moderate income families’
means families whose incomes do not exceed the me-
dian income for the area, as determined by the Sec-
retary with adjustments for smaller and larger fami-
lies, except that the Secretary may establish income
ceilings higher or lower than the median income for
the area on the basis of the Secretary’s findings that
such variations are necessary because of prevailing
levels of construction costs or fair market rents, or
unusually high or low family incomes.’’.
SEC. 504. LOAN GUARANTEES.
Subtitle A of title II of the Cranston-Gonzalez Na-
tional Affordable Housing Act (42 U.S.C. 12741 et seq.)
is amended by adding at the end the following new section:
‘‘SEC. 227. LOAN GUARANTEES.
‘‘(a) AUTHORITY.—The Secretary may, upon such
terms and conditions as the Secretary may prescribe,
guarantee and make commitments to guarantee, only to
such extent or in such amounts as provided in appropria-
tions Acts, the notes or other obligations issued by eligible
participating jurisdictions or by public agencies designated
by and acting on behalf of eligible participating jurisdic-
tions for purposes of financing (including credit enhance-
ments and debt service reserves) the acquisition, new con-
struction, reconstruction, or moderate or substantial reha-
bilitation of affordable housing (including real property ac-
quisition, site improvement, conversion, and demolition),
and other related expenses (including financing costs and
relocation expenses of any displaced persons, families,
businesses, or organizations). Housing funded under this
section shall meet the requirements of this subtitle.
‘‘(b) REQUIREMENTS.—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 the Secretary.
The Secretary may not deny a guarantee under this sec-
tion 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 oth-
erwise causes the guarantee to constitute an unacceptable
financial risk.
‘‘(c) LIMITATION ON TOTAL NOTES AND OBLIGA-
TIONS.—The Secretary may not guarantee or make a com-
mitment to guarantee any note or other obligation if the
total outstanding notes or obligations guaranteed under
this section on behalf of the participating jurisdiction
issuing the note or obligation (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 alloca-
tion under section 217.
‘‘(d) USE OF PROGRAM FUNDS.—Notwithstanding
any other provision of this subtitle, funds allocated to the
participating jurisdiction under this subtitle (including
program income derived therefrom) are authorized for use
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, underwriting, or other
issuance or collection charges as may be specified by the
Secretary.
‘‘(e) SECURITY.—To assure the full repayment of
notes or other obligations guaranteed under this section,
and payment of the issuance or collection charges specified
by the Secretary under subsection (d), and as a prior con-
dition 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 subtitle; 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
disposition proceeds from the sale of land or hous-
ing.
‘‘(f) REPAYMENT AUTHORITY.—The Secretary may,
notwithstanding any other provision of this subtitle or any
other Federal, State, or local law, apply allocations
pledged pursuant to subsection (e) to any repayments due
the United States as a result of such guarantees.
‘‘(g) FULL FAITH AND CREDIT.—The full faith and
credit of the United States is pledged to the payment of
all guarantees made under this section. Any such guar-
antee 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 guarantee so made shall be incontest-
able in the hands of a holder of the guaranteed obligations.
‘‘(h) TAX STATUS.—With respect to any obligation
guaranteed pursuant to this section, the guarantee and
the obligation shall be designed in a manner such that the
interest paid on such obligation shall be included in gross
income for purposes of the Internal Revenue Code of
1986.
‘‘(i) MONITORING.—The Secretary shall monitor the
use of guarantees under this section by eligible partici-
pating jurisdictions. If the Secretary finds that 50 percent
of the aggregate guarantee authority for any fiscal year
has been committed, the Secretary may impose limitations
on the amount of guarantees any 1 participating jurisdic-
tion may receive during that fiscal year.
‘‘(j) GUARANTEE OF TRUST CERTIFICATES.—
‘‘(1) AUTHORITY.—The Secretary may, upon
such terms and conditions as the Secretary deems
appropriate, guarantee the timely payment of the
principal of and interest on such trust certificates or
other obligations as may—
‘‘(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 Sec-
retary under this section.
‘‘(2) FULL FAITH AND CREDIT.—To the same
extent as provided in subsection (g), the full faith
and credit of the United States is pledged to the
payment of all amounts which may be required to be
paid under any guarantee by the Secretary under
this subsection.
‘‘(3) SUBROGATION.—In the event the Sec-
retary pays a claim under a guarantee issued under
this section, the Secretary shall be subrogated fully
to the rights satisfied by such payment.
‘‘(4) OTHER POWERS AND RIGHTS.—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
public offerings and other sales of notes, trust
certificates, and other obligations guaranteed
under this section, upon such terms and condi-
tions as the Secretary 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
applicable, in notes, certificates or other obliga-
tions guaranteed under this section, or consti-
tuting the trust or pool against which trust cer-
tificates or other obligations guaranteed under
this section are offered.
‘‘(k) AGGREGATE LIMITATION.—The total amount of
outstanding obligations guaranteed on a cumulative basis
by the Secretary under this section shall not at any time
exceed $2,000,000,000.’’.
SEC. 505. HOMEOWNERSHIP FOR MUNICIPAL EMPLOYEES.
(a) ELIGIBLE ACTIVITIES.—Paragraph (2) of section
215(b) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12745(b)(2)) is amended to read
as follows:
‘‘(2) is the principal residence of an owner
who—
‘‘(A) is a member of a family that qualifies
as a low-income family—
‘‘(i) in the case of a contract to pur-
chase existing housing, at the time of pur-
chase;
‘‘(ii) in the case of a lease-purchase
agreement for existing housing or for hous-
ing to be constructed, at the time the
agreement is signed; or
‘‘(iii) in the case of a contract to pur-
chase housing to be constructed, at the
time the contract is signed; or
‘‘(B)(i) is a uniformed employee (which
shall include policemen, firemen, and sanitation
and other maintenance workers) or a teacher
who is an employee, of the participating juris-
diction (or an agency or school district serving
such jurisdiction) that is investing funds made
available under this subtitle to support home-
ownership of the residence; and
‘‘(ii) is a member of a family whose in-
come, at the time referred to in clause (i), (ii),
or (iii) of subparagraph (A), as appropriate,
and as determined by the Secretary with ad-
justments for smaller and larger families, does
not exceed 115 percent of the median income of
the area;’’.
(b) INCOME TARGETING.—Section 214(2) of the
Cranston-Gonzalez National Affordable Housing Act (42
U.S.C. 12744(2)) is amended by inserting before the semi-
colon the following: ‘‘or families described in section
215(b)(2)(B)’’.
(c) ELIGIBLE INVESTMENTS.—Section 212(b) of the
Cranston-Gonzalez National Affordable Housing Act (42
U.S.C. 12742(b)) is amended by adding at the end the
following new sentence: ‘‘Notwithstanding the preceding
sentence, in the case of homeownership assistance for resi-
dences of owners described in section 215(b)(2)(B), funds
made available under this subtitle may only be invested
(A) to provide amounts for downpayments on mortgages,
(B) to pay reasonable closing costs normally associated
with the purchase of a residence, (C) to obtain pre- or
post-purchase counseling relating to the financial and
other obligations of homeownership, or (D) to subsidize
mortgage interest rates.’’.
TITLE VI—LOCAL
HOMEOWNERSHIP INITIATIVES
SEC. 601. REAUTHORIZATION OF NEIGHBORHOOD REIN-
VESTMENT CORPORATION.
Section 608(a)(1) of the Neighborhood Reinvestment
Corporation Act (42 U.S.C. 8107(a)(1)) is amended by
striking the first sentence and inserting the following new
sentence: ‘‘There is authorized to be appropriated to the
corporation to carry out this title $90,000,000 for each
of fiscal years 2000 through 2004.’’.
SEC. 602. HOMEOWNERSHIP ZONES.
Section 186 of the Housing and Community Develop-
ment Act of 1992 (42 U.S.C. 12898a) is amended to read
as follows:
‘‘SEC. 186. HOMEOWNERSHIP ZONE GRANTS.
‘‘(a) AUTHORITY.—The Secretary of Housing and
Urban Development may make grants to units of general
local government to assist homeownership zones. Home-
ownership zones are contiguous, geographically defined
areas, primarily residential in nature, in which large-scale
development projects are designed to reclaim distressed
neighborhoods by creating homeownership opportunities
for low- and moderate-income families. Projects in home-
ownership zones are intended to serve as a catalyst for