‘‘(e) DISTRIBUTION AND RESIDUAL RECEIPTS.— 
‘‘(1) AUTHORITY.—After the date of the enact-
ment of the Preservation Enhancement and Savings 
Opportunity Act of 2015, the owner of a property 
subject to a plan of action or use agreement pursu-
ant to this section shall be entitled to distribute— 
‘‘(A) annually, all surplus cash generated 
by the property, but only if the owner is in ma-
terial compliance with such use agreement in-
cluding compliance with prevailing physical con-
dition standards established by the Secretary; 
and 
‘‘(B) notwithstanding any conflicting provi-
sion in such use agreement, any funds accumu-
lated in a residual receipts account, but only if 
the owner is in material compliance with such 
use agreement and has completed, or set aside 
sufficient funds for completion of, any capital 
repairs identified by the most recent third party 
capital needs assessment. 
‘‘(2) OPERATION
OF
PROPERTY.—An owner 
that distributes any amounts pursuant to paragraph 
(1) shall— 
‘‘(A) continue to operate the property in 
accordance with the affordability provisions of 
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the use agreement for the property for the re-
maining useful life of the property; 
‘‘(B) as required by the plan of action for 
the property, continue to renew or extend any 
project-based rental assistance contract for a 
term of not less than 20 years; and 
‘‘(C) if the owner has an existing multi- 
year project-based rental assistance contract for 
less than 20 years, have the option to extend 
the contract to a 20-year term.’’. 
SEC. 3. FUTURE REFINANCINGS. 
Section 214 of the Low-Income Housing Preservation 
and Resident Homeownership Act of 1990 (12 U.S.C. 
4104) is amended by adding at the end the following new 
subsection: 
‘‘(c) FUTURE FINANCING.—Neither this section, nor 
any plan of action or use agreement implementing this 
section, shall restrict an owner from obtaining a new loan 
or refinancing an existing loan secured by the project, or 
from distributing the proceeds of such a loan; except that, 
in conjunction with such refinancing— 
‘‘(1) the owner shall provide for adequate reha-
bilitation pursuant to a capital needs assessment to 
ensure long-term sustainability of the property satis-
factory to the lender or bond issuance agency; 
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‘‘(2) any resulting budget-based rent increase 
shall include debt service on the new financing, com-
mercially reasonable debt service coverage, and re-
placement reserves as required by the lender; and 
‘‘(3) for tenants of dwelling units not covered 
by a project- or tenant-based rental subsidy, any 
rent increases resulting from the refinancing trans-
action may not exceed 10 percent per year, except 
that— 
‘‘(A) any tenant occupying a dwelling unit 
as of time of the refinancing may not be re-
quired to pay for rent and utilities, for the du-
ration of such tenancy, an amount that exceeds 
the greater of— 
‘‘(i) 30 percent of the tenant’s income; 
or 
‘‘(ii) the amount paid by the tenant 
for rent and utilities immediately before 
such refinancing; and 
‘‘(B) this paragraph shall not apply to any 
tenant who does not provide the owner with 
proof of income. 
Paragraph (3) may not be construed to limit any rent in-
creases resulting from increased operating costs for a 
project.’’. 
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SEC. 4. IMPLEMENTATION. 
The Secretary of Housing and Urban Development 
shall issue any guidance that the Secretary considers nec-
essary to carry out the provisions added by the amend-
ments made by sections 2 and 3 not later than the expira-
tion of the 120-day period beginning on the date of the 
enactment of this Act. 
Æ 
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