I
103D CONGRESS
2D SESSION
H. R. 3793
To provide for the Secretary of Housing and Urban Development to make
grants for economic development activities in connection with loan guar-
antees under section 108 of the Housing and Community Development
Act of 1974 to enhance the security of such loans and improve the
viability of projects financed with such loans, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 3, 1994
Mr. RIDGE introduced the following bill; which was referred to the Committee
on Banking, Finance and Urban Affairs
A BILL
To provide for the Secretary of Housing and Urban Develop-
ment to make grants for economic development activities
in connection with loan guarantees under section 108
of the Housing and Community Development Act of
1974 to enhance the security of such loans and improve
the viability of projects financed with such loans, and
for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Community Enterprise
Revitalization Amendments Act’’.
SEC. 2. SECTION 108 ELIGIBLE ACTIVITIES.
(a) IN GENERAL.—Section 108(a) of the Housing
and Community Development Act of 1974 (42 U.S.C.
5308(a)) is amended—
(1) in the first sentence—
(A) 
by 
striking 
‘‘or’’ 
after 
‘‘section
105(a);’’; and
(B) by inserting before the period the fol-
lowing: ‘‘; (5) the acquisition, construction, re-
construction, or installation of public facilities
(except for buildings for the general conduct of
government); or (6) in the case of colonias, pub-
lic works and site or other improvements’’; and
(2) by striking the second sentence and insert-
ing the following: ‘‘A guarantee under this section
(including a guarantee combined with a grant under
subsection (q)) may be used to assist a grantee in
obtaining financing only if the grantee has made ef-
forts to obtain the financing without the use of the
guarantee (and, if applicable, the grant) and cannot
complete the financing consistent with the timely
execution of the proposed activities and projects
without the guarantee (or, if applicable, the
grant).’’.
(b) DEFINITION.—Section 102(a) of the Housing and
Community Development Act of 1974 (42 U.S.C.
5302(a)) is amended by adding at the end the following
new paragraph:
‘‘(24) The term ‘colonia’ means any identifiable
community that—
‘‘(A) is in the State of Arizona, California,
New Mexico, or Texas;
‘‘(B) is in the United States-Mexico border
region;
‘‘(C) is determined to be a colonia on the
basis of objective criteria, including lack of po-
table water supply, lack of adequate sewage sys-
tems, and lack of decent, safe, and sanitary
housing; and
‘‘(D) was in existence as a colonia before
the date of the enactment of the Cranston-Gon-
zalez National Affordable Housing Act.’’.
SEC. 3. ECONOMIC DEVELOPMENT GRANTS.
(a) IN GENERAL.—Section 108 of the Housing and
Community Development Act of 1974 (42 U.S.C. 5308)
is amended by adding at the end the following new sub-
section:
‘‘(q) ECONOMIC DEVELOPMENT GRANTS.—
‘‘(1) AUTHORIZATION.—The Secretary may
make grants in connection with notes or other obli-
gations guaranteed under this section to eligible
public entities for the purpose of enhancing the secu-
rity of loans guaranteed under this section or im-
proving the viability of projects financed with loans
guaranteed under this section.
‘‘(2) ELIGIBLE ACTIVITIES.—Assistance under
this subsection may be used for the purposes of and
in conjunction with projects and activities assisted
under subsection (a).
‘‘(3) APPLICATIONS.—Applications for assist-
ance under this subsection shall be submitted by eli-
gible public entities in the form and in accordance
with the procedures established by the Secretary. El-
igible public entities may apply for grants only in
conjunction with a request for guarantee under sub-
section (a).
‘‘(4) SELECTION
CRITERIA.—The Secretary
shall establish criteria for awarding assistance under
this subsection. Such criteria shall include—
‘‘(A) the extent of need for such assist-
ance;
‘‘(B) the level of distress in the community
to be served and in the jurisdiction applying for
assistance;
‘‘(C) the quality of the plan proposed and
the capacity or potential capacity of the appli-
cant to successfully carry out the plan; and
‘‘(D) such other factors as the Secretary
determines to be appropriate.’’.
(b) CONFORMING AMENDMENT.—Title I of the Hous-
ing and Community Development Act of 1974 (42 U.S.C.
5301 et seq.) is amended—
(1) in section 101(c) in the second sentence, by
inserting ‘‘or a grant’’ after ‘‘guarantee’’; and
(2) in section 104(b)(3), by inserting ‘‘or a
grant’’ after ‘‘guarantee’’.
SEC. 4. USE OF UDAG RECAPTURES.
Section 119(o) of the Housing and Community De-
velopment Act of 1974 (42 U.S.C. 5318(o)) is amended
by inserting before the period the following: ‘‘, except that
amounts available to the Secretary for use under this sub-
section as of October 1, 1993, and amounts released to
the Secretary pursuant to subsection (t) may, to the extent
or in such amounts as are or have been provided in appro-
priation Acts, be used to provide grants under section
108(q).’’.
SEC. 5. UDAG AMNESTY PROGRAM.
(a) AMENDMENT.—Section 119 of the Housing and
Community Development Act of 1974 (42 U.S.C. 5318)
is amended by adding at the end the following new sub-
section:
‘‘(t) UDAG AMNESTY PROGRAM.—If a grant or a
portion of a grant under this section remains unexpended
as of the issuance of a notice implementing this sub-
section, the grantee may enter into an agreement, as pro-
vided under this subsection, with the Secretary to receive
a percentage of the grant amount and relinquish all claims
to the balance of the grant within 90 days of the issuance
of notice implementing this subsection (or such later date
as the Secretary may approve). The Secretary shall not
recapture any funds obligated pursuant to this section
during a period beginning on the date of enactment of the
Housing and Community Development Act of 1993 until
90 days after the issuance of a notice implementing this
subsection. A grantee may receive as a grant under this
subsection—
‘‘(1) 33 percent of such unexpended amounts
if—
‘‘(A) the grantee agrees to expend not less
than one-half of the amount received for activi-
ties authorized pursuant to section 108(q) and
to expend such funds in conjunction with a loan
guarantee made under section 108 at least
equal to twice the amount of the funds received;
and
‘‘(B)(i) the remainder of the amount re-
ceived is used for economic development activi-
ties eligible under title I of this Act; and
‘‘(ii) except when waived by the Secretary
in the case of a severely distressed jurisdiction,
not more than one-half of the costs of activities
under subparagraph (B) are derived from such
unexpended amounts; or
‘‘(2) 25 percent of such unexpended amounts
if—
‘‘(A) the grantee agrees to expend such
funds for economic development activities eligi-
ble under title I of this Act; and
‘‘(B) except when waived by the Secretary
in the case of a severely distressed jurisdiction,
not more than one-half of the costs of such ac-
tivities are derived from such unexpended
amount.’’.
(b) IMPLEMENTATION.—Notwithstanding section 7,
not later than 10 days after the date of enactment of this
Act, the Secretary shall, by notice published in the Federal
Register, which shall take effect upon publication, estab-
lish such requirements as may be necessary to implement
the amendments made by this section.
SEC. 6. GUARANTEE OF OBLIGATIONS BACKED BY SECTION
108 LOANS.
Section 108 of the Housing and Community Develop-
ment Act of 1974 (42 U.S.C. 5308), as amended by sec-
tion 3, is amended by adding at the end the following new
subsection:
‘‘(r) GUARANTEE OF OBLIGATIONS BACKED BY SEC-
TION 108 LOANS.—
‘‘(1) AUTHORIZATION.—The Secretary may,
upon such terms and conditions as the Secretary
deems appropriate, guarantee the timely payment of
the principal of and interest on trust certificates or
other obligations that—
‘‘(A) are offered by the Secretary, or by
any other offeror approved for purposes of this
subsection by the Secretary; and
‘‘(B) are based on and backed by a trust
or pool composed of notes or other obligations
guaranteed by the Secretary under this section.
‘‘(2) FULL FAITH AND CREDIT OF THE UNITED
STATES.—Subsection (f) shall apply to any guaran-
tee under this subsection.
‘‘(3) SUBROGATION.—If the Secretary pays a
claim under a guarantee issued under this section,
the Secretary shall be subrogated fully to the rights
satisfied by such payment.
‘‘(4) POWERS OF THE SECRETARY.—No Fed-
eral, State, or local 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 con-
stituting the trust or pool against which trust
certificates or other obligations guaranteed
under this section are offered.’’.
SEC. 7. EFFECTIVE DATE.
The Secretary shall, by notice published in the Fed-
eral Register, which shall take effect upon publication, es-
tablish such requirements as may be necessary to imple-
ment the amendments made by this Act. The notice shall
invite public comments and, not later than 12 months
after the date on which the notice is published, the Sec-
retary shall issue final regulations based on the initial no-
tice, taking into account any public comments received.
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