(3) CERTIFICATION.—The Secretary shall re-
quire States to certify to the Secretary the amount
of non-Federal funds provided for purposes of sub-
section (e)(2).
(g) GRANTS FOR INELIGIBLE STATES AND STATES
WITH INSUFFICIENT MATCHING CONTRIBUTIONS.—
(1) AVAILABLE AMOUNTS.—For a fiscal year,
the following amounts shall be available for grants
under this subsection:
(A) 
ALLOCATION
FOR
INELIGIBLE
STATE.—With respect to each ineligible State,
the amount of the allocation for the State for
such fiscal year determined under subsection
(d).
(B) UNMATCHED
PORTION
OF
ALLOCA-
TION.—With respect to any eligible State for
which the amount of the grant assistance for
such fiscal year is determined under subsection
(e)(2), the amount by which the allocation de-
termined under subsection (d) for the State for
the fiscal year exceeds the grant assistance for
the State for the fiscal year.
(2) NOTICE.—For each fiscal year, not later
than 60 days after the date that the Secretary deter-
mines that the amounts described in paragraph (1)
shall be available for grants under this subsection,
the Secretary shall cause to be published in the Fed-
eral Register a notice that such amounts shall be so
available.
(3) APPLICATIONS.—The Secretary shall pro-
vide for nonprofit and public entities (and consortia
thereof, which may include units of local government
working together on a regional basis) to submit ap-
plications, during the 9-month period beginning
upon publication of a notice of funding availability
under paragraph (2), for a grant of all or a portion
of the amounts referred to in paragraph (1). Such
an application shall include—
(A) a certification that the applicant will
provide supplemental amounts in accordance
with paragraph (5)(B)(i); and
(B) an allocation plan described in para-
graph (5)(B)(ii).
(4) 
SELECTION
CRITERIA.—The 
Secretary
shall, by regulation, establish criteria for selecting
applicants that meet the requirements of paragraph
(3) for funding under this subsection. Such criteria
shall give priority to applications that provide that
grant amounts under this subsection will be used for
eligible activities relating to affordable housing that
is located in the State for which such grant funds
were originally allocated under subsection (d).
(5) AWARD AND USE OF GRANT ASSISTANCE.—
(A) AWARD OF GRANTS.—Subject only to
the absence of applications meeting the require-
ments of paragraph (3), upon the expiration of
the period referred to in such paragraph, the
Secretary shall select an applicant or applicants
under this subsection to receive the amounts
available under paragraph (1) and shall make a
grant or grants to such applicant or applicants.
The selection shall be based upon the criteria
established under paragraph (4).
(B) GRANT
REQUIREMENTS.—Grant as-
sistance under this subsection shall be subject
to the following requirements:
(i) MATCHING AMOUNTS.—The grant-
ee shall supplement any grant amounts re-
ceived under this subsection with an
amount equal to 25 percent of such grant
amounts.
(ii) USE.—Grant amounts received
under this subsection shall be used in ac-
cordance with an allocation plan that
meets the requirements of section 5(e) and
provides that any assistance provided to
the applicant under this subsection, and
any supplemental amounts provided by the
applicant pursuant to clause (i), shall be
used only to carry out eligible activities.
SEC. 5. USE OF ASSISTANCE BY RECIPIENTS.
(a) DISTRIBUTION TO ELIGIBLE ENTITIES.—Each
State that receives a grant under this Act shall distribute
the grant amounts (excluding any amounts used under
subsection (b)) to eligible entities for use by such entities
only for eligible activities in the State, as follows:
(1) USE
FOR
RENTAL
HOUSING
FOR
EX-
TREMELY
LOW-INCOME
FAMILIES.—75 percent of
such amounts shall be distributed for use only for el-
igible activities relating to affordable housing that is
available for rental by extremely low-income families
in the State.
(2) USE
FOR
RENTAL
HOUSING
OR
HOME-
OWNERSHIP FOR LOW-INCOME FAMILIES.—25 per-
cent of such amounts shall be distributed for use
only for eligible activities relating to affordable hous-
ing that is available for rental by low-income fami-
lies in the State, or for homeownership assistance
for low-income families in the State.
adjusted annually, and established by number of bed-
rooms, market area, and eligible activity.
(d) ELIGIBLE STATES.—With respect to a fiscal year,
a State shall be an eligible State for purposes of this Act
for such fiscal year only if the State has established an
allocation plan that has been submitted to the Secretary
and reviewed and approved by the Secretary as in accord-
ance with subsection (e). The Secretary may disapprove
an allocation plan only if the plan fails to comply with
requirements set forth in this section.
(e) ALLOCATION PLAN.—
(1) IN GENERAL.—An allocation plan in accord-
ance with this subsection is a plan, established by a
State for a fiscal year, for the distribution of grant
amounts provided to the State under this Act for
such fiscal year.
(2) ESTABLISHMENT.—In establishing an allo-
cation plan, the State shall notify the public of the
establishment of the plan, provide an opportunity for
public comments regarding the plan, consider any
public comments received, and make the completed
plan available to the public.
(3) CONTENTS.—An allocation plan of a State
shall include the following information:
(A) APPLICATION REQUIREMENTS FOR EL-
IGIBLE
ENTITIES
AND
SUBRECIPIENTS.—The
allocation plan shall set forth the requirements
for eligible entities and eligible subrecipients to
apply to receive assistance from grant amounts
under this Act, including a requirement that
each such application include—
(i) a description of the eligible activi-
ties to be conducted using such assistance;
and
(ii) a certification by the applicant
that any housing units assisted with such
assistance will comply with the require-
ments under—
(I) section 6(1)(A) (relating to
rents charged);
(II) section 6(1)(B) (relating to
tenant rent contribution);
(III) section 6(1)(C) (relating to
availability of units for voucher hold-
ers); and
(IV) section 6(1)(D) (relating to
use as affordable housing for 40
years).
(B) SELECTION
AND
PREFERENCE
CRI-
TERIA FOR ELIGIBLE ENTITIES AND SUBRECIPI-
ENTS.—The allocation plan shall set forth the
factors for consideration in selecting among ap-
plicants that meet the application requirements
set forth pursuant to subparagraph (A), which
shall give preference to applicants based on—
(i) the amount of assistance leveraged
by the applicant from private and other
non-Federal sources for carrying out the
eligible activities to be funded with assist-
ance from grant amounts under this Act,
including assistance made available under
section 8 of the United States Housing Act
of 1937 (42 U.S.C. 1437f) that is devoted
to the project that contains the affordable
housing to be assisted with such assist-
ance;
(ii) the extent of local assistance that
will be provided in carrying out the eligible
activities, including—
(I) financial assistance;
(II) the extent to which the ap-
plicant has worked to address issues
of siting and exclusionary zoning or
other policies that are barriers to af-
fordable housing with the unit of gen-
eral local government in which the
housing to be assisted with such as-
sistance will be located; and
(III) the extent to which the ap-
plicant has worked with the unit of
general local government to reduce
the barriers to affordable housing;
(iii) the degree to which the project in
which the affordable housing will be lo-
cated will have residents of various in-
comes;
(iv) the extent of employment and
other economic opportunities for low-in-
come families in the area in which the
housing will be located;
(v) the extent to which the applicant
demonstrates the ability to maintain dwell-
ing units as affordable housing through the
use of assistance made available under this
Act, assistance leveraged from non-Federal
sources, assistance made available under
section 8 of the United States Housing Act
of 1937 (42 U.S.C. 1437f), State or local
assistance, programs to increase tenant in-
come, cross-subsidization, and any other
resources;
(vi) the extent to which the applicant
demonstrates that the county in which the
housing is to be located is experiencing an
extremely low vacancy rate;
(vii) the extent to which the percent-
age of the housing located in such county
that is extremely old housing exceeds 35
percent;
(viii) whether the applicant has pro-
vided that—
(I) 75 percent of the grant
amounts will be used for eligible ac-
tivities relating to housing located in
census tracts in which the number of
families having incomes less than the
poverty line is less than 20 percent or
in communities undergoing revitaliza-
tion; and
(II) 25 percent of the grant
amounts will be used for eligible ac-
tivities relating to housing that is lo-
cated in census tracts in which the
number of families having incomes
less than the poverty line is greater
than 20 percent and is not located in
a community undergoing revitaliza-
tion; and
(ix) whether the applicant has pro-
vided that—
(I) not less than 45 percent of
the grant amounts will be used for eli-
gible activities relating to housing that
is affordable to families having in-
comes less than 30 percent of the
greater of (aa) the median income for
the area in which the housing is lo-
cated, or (bb) the median income for
the State in which the housing is lo-
cated;
(II) not less than 30 percent of
the grant amounts will be used for eli-
gible activities relating to housing that
is affordable to families having in-
comes not exceeding the amount
earned by a family having one indi-
vidual (or 1.5 individuals in the case
of a family consisting of 3 or more in-
dividuals), who is employed on a full-
time basis in a position paying the
higher of (aa) the Federal minimum
wage under section 6(a)(1) of the
Fair Labor Standards Act of 1938
(29 U.S.C. 206(a)(1)), or (bb) the
minimum wage under State law of the
State in which the housing is located;
and
(III) not more than 25 percent of
the grant amounts will be used for eli-
gible activities relating to housing for
families having incomes that (aa) are
greater than the incomes referred to
in subclauses (I) and (II) of this
clause, but (bb) do not exceed 80 per-
cent of the median income for the
area in which the housing is located.
(4) CONSOLIDATED PLAN.—The Secretary shall
provide that a State may comply with the require-
ments under this subsection for submission of a allo-
cation plan through the inclusion of any appropriate
information in a single consolidated submission used
for purposes of applying for other community plan-
ning and development and housing assistance pro-
grams administered by the Secretary.
(f) FORMS OF ASSISTANCE.—
(1) IN GENERAL.—Assistance may be distrib-
uted pursuant to this section in the form of capital
grants, noninterest bearing or low-interest loans or
advances, deferred payment loans, guarantees, and
any other forms of assistance approved by the Sec-
retary.
(2) REPAYMENTS.—If a State awards assist-
ance under this section inthe form of a loan or other
mechanism by which funds are later repaid to the
State, any repayments received by the State shall be
distributed by the State in accordance with the allo-
cation plan under subsection (e) for the State for
the fiscal year in which such repayments are made.
(g) COORDINATION WITH OTHER ASSISTANCE.—In
distributing assistance pursuant to this section, each State
shall, to the maximum extent practicable, coordinate such
distribution with the provision of other affordable housing
assistance by the State, including—
(1) housing credit dollar amounts allocated by
the State under section 42(h) of the Internal Rev-
enue Code of 1986;
(2) assistance made available under the HOME
Investment Partnerships Act (42 U.S.C. 12721 et
seq.) or the community development block grant pro-
gram under title I of the Housing and Community
Development Act of 1974 (42 U.S.C. 5301 et seq.);
and
(3) private activity bonds.
(h) ADMINISTRATION OF STATE PROGRAM BY SUB-
RECIPIENT.—At the discretion of the State, a State may
select an eligible subrecipient to carry out all or a portion
of the State’s responsibilities under this Act, in accordance
with this section.
SEC. 6. DEFINITIONS.
For purposes of this Act, the following definitions
shall apply:
(1) AFFORDABLE HOUSING.—The term ‘‘afford-
able housing’’ means a rental dwelling unit that is
subject to legally binding commitments that ensure
that the dwelling unit meets all of the following re-
quirements:
(A) RENTS.—The dwelling unit bears a
rent not greater than the lesser of—
(i) the existing fair market rental es-
tablished by the Secretary under section
8(c) of the United States Housing Act of
1937 (42 U.S.C. 1437f(c)) for a dwelling
unit of the same size in the same market
area; and
(ii) a rent that does not exceed 30
percent of the adjusted income of a family
whose income equals 65 percent of the me-
dian income for the area, as determined by
the Secretary, with adjustment for number
of bedrooms in the unit, except that the
Secretary may establish income ceilings
higher or lower than 65 percent of the me-
dian for the area on the basis of the find-
ings of the Secretary that such variations
are necessary because of prevailing levels
of construction costs or fair market rents,
or unusually high or low family incomes.
(B) TENANT RENT CONTRIBUTION.—The
contribution toward rent by the family residing
in the dwelling unit will not exceed 30 percent
of the adjusted income of such family.
(C) AVAILABILITY OF UNITS FOR VOUCHER
HOLDERS.—The dwelling unit—
(i) is located in a project within which
a percentage of units are made available
only for occupancy by families assisted
under the voucher program under section
8(o) of the United States Housing Act of
1937 (42 U.S.C. 1437f(o)) (including
project-based 
assistance 
under 
section
8(o)(13)) on the same basis as other fami-
lies eligible for occupancy of the project
(except that only the voucher holder’s ex-
pected share of rent shall be considered),
which percentage shall not be less than the
percentage of the total cost of developing,
rehabilitating, or preserving the project
that is funded with assistance under this
Act; and
(ii) is one of the units that is subject
to such occupancy requirements.
(D) 
NON-DISCRIMINATION
AGAINST
VOUCHER HOLDERS.—The dwelling unit is lo-
cated in a project in which all dwelling units
are subject to enforceable restrictions that pro-
vide that a unit may not be refused for leasing
to a holder of a voucher of eligibility under sec-
tion 8 of the United States Housing Act of
1937 (42 U.S.C. 1437f) because of the status
of the prospective tenant as a holder of such
voucher.
(E) DURATION
OF
USE.—The dwelling
unit will continue to be subject to the require-
ments under this paragraph for not less than
40 years.
(2) CONTINUED ASSISTANCE RENTAL SUBSIDY
PROGRAM.—The term ‘‘continued assistance rental
subsidy program’’ means a program that—
(A) provides project-based rental assist-
ance, for not more than 3 years, on behalf of
a family who resides in a dwelling unit that
complies with the requirements under subpara-
graphs (A) and (B) of paragraph (1);
(B) is administered—
(i) by the public housing agency with-
in whose jurisdiction the affordable hous-
ing is located (or if no such agency exists,
the agency whose jurisdiction is closest to
such unit); and
(ii) in accordance with section 8(o) of
the United States Housing Act of 1937
(42 U.S.C. 1437f(o)); and
(C) provides that, upon the expiration of
the period that the family receives rental assist-
ance under the program pursuant to subpara-
graph (A) of this Act, project-based rental as-
sistance under section 8(o)(13) of the United
States Housing Act of 1937 (42 U.S.C.
1437f(o)(13)) shall be provided on behalf of the
family for rental of such dwelling unit, notwith-
standing any provision to the contrary in such
section 8(o).
(3) ELIGIBLE ACTIVITIES.—The term ‘‘eligible
activities’’ means activities relating to the providing
affordable housing, including—
(A) the construction of new housing;
(B) the acquisition of real property;
(C) site preparation and improvement, in-
cluding demolition;
(D) substantial rehabilitation of existing
housing;
(E) the provision of rental assistance
under a continued assistance rental subsidy
program; and
(F) providing incentives to maintain exist-
ing housing as affordable housing and to estab-
lish or extend any low-income affordability re-
strictions for such housing, including covering
capital expenditures and operating costs.
(4) ELIGIBLE ENTITY.—The term ‘‘eligible enti-
ty’’ includes any public or private nonprofit or for-
profit entity, unit of general local government, re-
gional planning entity, and any other entity engaged
in the development, rehabilitation, or preservation of
affordable housing, as determined by the Secretary.
(5) ELIGIBLE SUBRECIPIENT.—The term ‘‘eligi-
ble subrecipient’’ means a public agency or a non-
profit organization, including a community develop-
ment corporation, a community development finan-
cial institution, a State housing trust fund, and any
other intermediary selected by a State to administer
all or a portion of the State’s responsibilities under
this Act. The term does not include any public agen-
cy or nonprofit organization that receives money
from the Trust Fund solely as a developer or owner
of housing.
(6) EXTREMELY LOW-INCOME FAMILIES.—The
term ‘‘extremely low-income families’’ means families
(as such term is defined in section 3(b) of the
United States Housing Act of 1937 (42 U.S.C.
1437a(b))) whose incomes do not exceed 30 percent
of the median family income for the area, as deter-
mined by the Secretary with adjustments for smaller
and larger families, except that the Secretary may
establish income ceilings higher or lower than 30
percent of the median for the area on the basis of
the Secretary’s findings that such variations are nec-
essary because of unusually high or low family in-
comes.
(7) EXTREMELY
LOW
VACANCY
RATE.—The
term ‘‘extremely low vacancy rate’’ means a housing
or rental vacancy rate of 2 percent or less.
(8) EXTREMELY OLD HOUSING.—The term ‘‘ex-
tremely old housing’’ means housing that is 45 years
old or older.
(9) INELIGIBLE STATE.—The term ‘‘ineligible
State’’ means, with respect to a fiscal year, a State
that has not submitted to the Secretary an alloca-
tion plan meeting the requirements of section 5(e).
(10) LOW-INCOME FAMILIES.—The term ‘‘low-
income families’’ has the meaning given such term
in section 3(b) of the United States Housing Act of
1937 (42 U.S.C. 1437a(b)).
(11) POVERTY LINE.—The term ‘‘poverty line’’
has the meaning given such term in section 673(2)
of the Omnibus Budget Reconciliation Act of 1981,
including any revision required by such section.
(12) 
SECRETARY.—The 
term 
‘‘Secretary’’
means the Secretary of Housing and Urban Develop-
ment.
(13) STATE.—The term ‘‘State’’ has the mean-
ing given such term in section 3(b) of the United
States Housing Act of 1937 (42 U.S.C. 1437a(b)).
(14) TRUST FUND.—The term ‘‘Trust Fund’’
means the National Affordable Housing Trust Fund
established under section 3.
SEC. 7. AUTHORIZATION OF APPROPRIATIONS FOR SEC-
TION 8 PROJECT-BASED ASSISTANCE UNDER
CONTINUED ASSISTANCE RENTAL SUBSIDY
PROGRAMS.
There are authorized to be appropriated, for rental
assistance under section 8(o)(13) of the United States
Housing Act of 1937 (42 U.S.C. 1437f(o)(13)) provided
in connection with continued assistance rental subsidy
programs pursuant to section 6(2)(C) of this Act, such
sums as may be necessary for each fiscal year to provide
such rental assistance on behalf of each family whose as-
sistance is terminated pursuant to section 6(2)(A) of this
Act.
SEC. 8. REGULATIONS.
Not later than 6 months after the date of enactment
of this Act, the Secretary of Housing and Urban Develop-
ment shall promulgate regulations to carry out this Act.
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