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‘‘(A) to accept a partial payment of claim
for all such claims; and
‘‘(B) to accept a partial payment of insur-
ance benefits in order to avert a claim where
such claim is inevitable, regardless of whether a
monetary default has occurred.
‘‘SEC. 408. DEFAULT AND CLAIMS UNDER CONTRACT OF
MORTGAGE INSURANCE.
‘‘(a) IN GENERAL.—If a mortgagor fails to make any
payment due, or provided to be paid by the terms of a
mortgage insured, under this section, such failure shall be
a default under the mortgage. If the default continues for
a period of 30 days, the mortgagee shall be entitled to
receive the benefits of the insurance provided by the Sec-
retary under this section.
‘‘(b) CLAIMS REQUIREMENTS.—
‘‘(1) IN GENERAL.—The Secretary shall issue
requirements under subsection (a). These require-
ments may be changed from time to time to accom-
modate advances in technology, including those re-
lated to electronic transfers and filings. The require-
ments shall establish procedures under which the
mortgagee shall be required to assign, transfer, and
deliver to the Secretary—
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‘‘(A) the mortgage so in default and all
rights and interests arising thereunder;
‘‘(B) all claims of the mortgagee against
the mortgagor or others, arising out of the
mortgage transactions;
‘‘(C) all policies of title or other insurance
or surety bonds or other guaranties and any
and all claims thereunder;
‘‘(D) any balance of the mortgage loan not
advanced to the mortgagor;
‘‘(E) any cash, property, or other assets
(such as receivables) held by the mortgagee, or
to which the mortgagee is entitled to hold or re-
ceive for the account of the mortgagor or as ex-
cess proceeds arising out of the mortgage or
underlying bond transaction and which have not
been applied in reduction of the principal
amount of the mortgage indebtedness; and
‘‘(F) all records, documents, books, papers,
and accounts relating to the mortgage trans-
action.
‘‘(2) OPTIONAL PROCEDURE.—If a mortgagor
defaults under a mortgage insured under section
403, the Secretary may permit the mortgagee to ex-
ercise the option, pursuant to procedures established
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by the Secretary, of foreclosing upon the security
property and obtaining title, or obtaining title
through deed-in-lieu of foreclosure, or otherwise, and
conveying title to the Secretary. A mortgagee exer-
cising the option under this paragraph shall comply
with the requirements of paragraph (1), except sub-
paragraphs (A) and (D).
‘‘(c) TERMINATION OF MIP OBLIGATION.—After re-
ceipt of an application for insurance benefits under this
title, the Secretary is authorized to terminate the obliga-
tion of the mortgagee to pay mortgage insurance premium
charges.
‘‘(d) AMOUNT OF CLAIM.—The total amount of any
payout under an insurance claim under this title may not
exceed the amount which the mortgagee would have re-
ceived if the mortgage indebtedness and any other fiscal
obligations under the mortgage had been fully satisfied on
the date of the assignment of the claim or the conveyance
of title, plus interest and necessary expenses incurred by
the mortgagee in connection with the claim and preserva-
tion of the project, if applicable, as determined by the Sec-
retary, and in accordance with any contract involving risk-
sharing.
‘‘(e) ACQUISITION OF POSSESSION OR TITLE.—The
Secretary may, through foreclosure or otherwise, acquire
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possession of, or title to, any property covered by a mort-
gage assigned to the Secretary under this title.
‘‘(f) POWERS OF SECRETARY.—
‘‘(1) WITH RESPECT TO PROPERTY.—Notwith-
standing any other provisions of law relating to the
acquisition, handling, or disposal of real and other
property by the United States, the Secretary, in the
Secretary’s discretion and for the protection of the
General Insurance Fund, may—
‘‘(A) pay out of such Fund any expenses
or charges in connection with the preservation
of any security property under this title;
‘‘(B) deal with, complete, reconstruct, rent,
renovate, modernize, insure, make contracts for
the management of any property acquired
under this title;
‘‘(C) establish suitable agencies for the
management or lease of any property acquired
under this title; and
‘‘(D) sell or lease any real or personal
property (including mortgages) acquired under
this title.
‘‘(2) WITH
RESPECT
TO
MORTGAGES.—Not-
withstanding any other provision of law, the Sec-
retary may pursue to final collection, by way of com-
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promise or otherwise, obligations under mortgages
assigned under this title and all claims in connection
with any other transactions under this title.
‘‘SEC. 409. ADJUSTED PREMIUM CHARGE UPON PREPAY-
MENT.
‘‘If the principal obligation of any mortgage accepted
for insurance or reinsurance under this title is paid in full
before the maturity date, the Secretary may require the
mortgagee to pay an adjusted premium charge in such
amount as the Secretary determines to be equitable, but
not in excess of the aggregate amount of the premium
charges that the mortgagee would otherwise have been re-
quired to pay if the mortgage had continued to be insured
until such maturity date.
‘‘SEC. 410. ENVIRONMENTAL REVIEW.
‘‘(a) IN GENERAL.—In order to assure that the poli-
cies of the National Environmental Policy Act of 1969 and
other provisions of law which further the purposes of such
Act (as specified in regulations issued by the Secretary)
are most effectively implemented in connection with credit
enhancement under this title, and to assure to the public
undiminished protection of the environment, the Secretary
may, under such regulations, in lieu of the environmental
protection procedures otherwise applicable, provide for
agreements to endorse for insurance mortgages under this
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title upon the request of the mortgagee, qualified entity,
or qualified housing finance agency, if the State or unit
of general local government, as designated by the Sec-
retary in accordance with regulations, assumes all of the
responsibilities for environmental review, decisionmaking,
and action pursuant to such Act, and such other provi-
sions of law as the regulations of the Secretary may speci-
fy, that would otherwise apply to the Secretary with re-
spect to the insurance of mortgages on particular prop-
erties. For purposes of this subsection, the terms ‘unit of
general local government’ and ‘State’ have the same mean-
ings as in section 102(a) of the Housing and Community
Development Act of 1974.
‘‘(b) IMPLEMENTATION.—The Secretary shall issue
regulations to carry out this section only after consultation
with the Council on Environmental Quality. Such regula-
tions shall, among other matters, provide—
‘‘(1) for the monitoring of the performance of
environmental reviews under this subparagraph;
‘‘(2) subject to the discretion of the Secretary,
for the provision or facilitation of training for such
performance; and
‘‘(3) subject to the discretion of the Secretary,
for the suspension or termination by the Secretary
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of the State or unit of general local government’s re-
sponsibilities under subsection (a).
‘‘(c) SAVINGS.—The Secretary’s duty under sub-
section (b) shall not be construed to limit any responsibil-
ity assumed by a State or unit of general local government
with respect to any particular property under subsection
(a).
‘‘(d) PROCEDURE.—The Secretary shall approve a
mortgage for the provision of mortgage insurance subject
to the procedures authorized by this section only if, not
less than 30 days before such approval, before any ap-
proval, commitment, or endorsement of mortgage insur-
ance on the property by or on behalf of the Secretary, and
before any agreement by a qualified entity or a qualified
housing finance agency to provide financing under a risk-
sharing agreement with respect to the property, the mort-
gagee or the qualified participating entity or the qualified
housing finance agency submits to the Secretary a request
for such approval, accompanied by a certification of the
State or unit of general local government that meets the
requirements of subsection (e). The Secretary’s approval
of any such certification shall be deemed to satisfy the
Secretary’s responsibilities under the National Environ-
mental Policy Act of 1969 and such other provisions of
law as the regulations of the Secretary specify insofar as
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‘‘SEC. 413. LABOR STANDARDS AND COST CERTIFICATION.
‘‘This title shall be subject to the labor standards set
forth in section 212 and the cost certification standards
set forth in section 227.
‘‘SEC. 414. DISCLOSURE OF RECORDS.
‘‘Mortgages under section 403, qualified participating
entities under section 404, and qualified housing finance
agencies under section 405 shall make available to the
Secretary or the Secretary’s designee, at the Secretary’s
request, such financial and other records as the Secretary
deems necessary for purposes of review and monitoring
under this title.’’.
SEC. 411. LABOR STANDARDS AMENDMENT.
Section 212(a) of the National Housing Act is
amended—
(1) by striking ‘‘or section 210’’ in the first
sentence; and
(2) by inserting after the first sentence the fol-
lowing new sentence: ‘‘The provisions of this section
shall also apply to the insurance of any mortgage
under title IV, except that the provisions of this sec-
tion shall not apply to—
‘‘(1) the insurance of any mortgage that would
have been eligible for insurance under regulations of
the Secretary implementing section 223(f) of this
Act, as that section and those regulations existed
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immediately before the enactment of the FHA Multi-
family Housing Reform Act of 1996; and
‘‘(2) work performed by any individual who—
‘‘(A) volunteers—
‘‘(i) to perform a service for civic,
charitable, or humanitarian reasons, with-
out promise, expectation, or receipt of com-
pensation for services rendered, but solely
for the personal purpose or pleasure of the
individual; and
‘‘(ii) to provide such services freely
and without pressure or coercion, direct or
implied, from any employer; and
‘‘(B) is not otherwise employed at any time
in the construction work.’’.
SEC. 412. IMPLEMENTATION.
(a) EFFECTIVE DATE.—The provisions of, and the
amendments made by, this Act shall become effective upon
implementation by the Secretary in accordance with this
section.
(b) ADMINISTRATIVE IMPLEMENTATION.—Except as
otherwise specifically provided by title IV of the National
Housing Act (as added by section 410), the Secretary shall
take any administrative actions necessary to implement
the provisions of, and the amendments made by, this Act.
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The Secretary shall complete the initial implementation of
such provisions and amendments within 180 days of the
date of enactment of this Act.
(c) TERMINATION OF INSURING AUTHORITY.—
(1) IN GENERAL.—Effective on the date of im-
plementation of this Act, the Secretary may not ac-
cept applications or issue firm commitments under
any authority of title II of the National Housing Act
providing for the insurance of mortgages covering
multifamily rental housing or health care facilities
(as determined by the Secretary).
(2) EXCEPTIONS.—Paragraph (1) shall not
apply to—
(A) 
refinancings 
pursuant 
to 
section
223(a)(7) of the National Housing Act;
(B) extension of firm commitments entered
into before such date of implementation, but
only if the Secretary determines there is good
cause for an extension; or
(C) outstanding applications not having re-
ceived a firm commitment if unusual equitable
considerations are present.
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Subtitle B—Extensions of Existing
Authority and Other Provisions
SEC. 420. EXTENSION OF THE SECTION 221(g)(4) AUCTION
PROVISIONS.
The first sentence of section 221(g)(4)(C)(viii) of the
National Housing Act is amended by striking ‘‘September
30, 1996’’ and inserting ‘‘December 31, 2005, except that
the authority to apply this subparagraph in any fiscal year
shall be subject to appropriations for that year’’.
SEC. 421. EXTENSION OF TRANSFERRING EXCESS RE-
CEIPTS TO THE FLEXIBLE SUBSIDY PRO-
GRAM.
Section 236(f)(3) of the National Housing Act is
amended by striking ‘‘1994’’ and inserting ‘‘2000’’.
SEC. 422. DISCRETIONARY AUTHORITY TO REGULATE
RENTS FOR SPECIFIC MULTIFAMILY PROP-
ERTY.
(a) Section 207(b)(2) of the National Housing Act
is amended by striking ‘‘The’’ the first place it appears
and inserting the following: ‘‘For all projects with mort-
gages insured under this section, including those insured
before the date of enactment of the Housing and Urban-
Rural Recovery Act of 1983 (November 30, 1983), the’’.
(b) Section 223(f)(2) is amended by striking the sec-
ond sentence and inserting the following: ‘‘The Secretary
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shall prescribe such terms and conditions as the Secretary
deems necessary to assure that the refinancing is used to
lower the monthly debt service only to the extent necessary
to assure the continued economic viability of the project,
taking into account any rent reductions to be implemented
by the mortgagor. For all projects with mortgages insured,
or to be insured pursuant to this section, the Secretary
may, in the Secretary’s discretion, require any such mort-
gagor to be regulated or restricted as to rents or sales,
charges, capital structure, rate of return, and methods of
operation so as to provide reasonable rentals to tenants
and a reasonable return on investment. Any such regula-
tions or restrictions shall continue for such period or peri-
ods as the Secretary, in the Secretary’s discretion, may
require, including until the termination of all obligations
of the Secretary under the insurance and during such fur-
ther period of time as the Secretary shall be the owner,
holder or reinsurer of the mortgage.’’.
SEC. 423. EXPANSION OF PARTIAL PAYMENT OF CLAIMS
AUTHORITY TO COVER HEALTH CARE FACILI-
TIES.
(a) EXPANSION OF AUTHORITY.—Section 541(a) of
the National Housing Act is amended to read as follows:
‘‘(a) AUTHORITY.—Notwithstanding any other provi-
sion of law, if the Secretary is requested to accept assign-
HR 1433 IH2S
ment of a mortgage insured by the Secretary that covers
a multifamily housing project (as such term is defined in
section 203(b) of the Housing and Community Develop-
ment Amendments of 1978) or a health care facility (in-
cluding a nursing home, intermediate care facility, or
board and care home (as such terms are defined in section
232 of this Act), a hospital (as such term is defined in
section 242 of this Act), or a group practice facility (as
such term is defined in title XI of this Act)) and the Sec-
retary determines that partial payment would be less cost-
ly to the Federal Government than other reasonable alter-
natives for maintaining the low-income character of the
project, or keeping the health care facility in operation to
serve community needs, as appropriate, the Secretary may
request the mortgage in lieu of assignment, to—
‘‘(1) accept partial payment of claim under the
mortgage insurance contract; and
‘‘(2) recast the mortgage, under such terms and
conditions as the Secretary may determine.’’.
(b) CONFORMING CHANGE.—The heading to section
541 of such Act is amended to read as follows:
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‘‘PARTIAL PAYMENT OF CLAIMS ON MULTIFAMILY
HOUSING PROJECTS AND HEALTH CARE FACILITIES’’.
SEC. 424. ENVIRONMENTAL PROTECTION UNDER SECTION
202 AND SECTION 811 PROGRAMS.
(a) SUPPORTIVE HOUSING FOR THE ELDERLY.—Sec-
tion 202 of the Housing Act of 1959 is amended by adding
at the end the following new subsection:
‘‘(k) ENVIRONMENTAL PROTECTION.—
‘‘(1) PURPOSE.—The purpose of this subsection
is to authorize a procedure for the assumption of en-
vironmental review responsibilities of the Secretary
by States and units of general local government in
connection with capital advances provided under this
section. This procedure shall be designed to en-
sure—
‘‘(A) that the policies of the National Envi-
ronmental Policy Act of 1969 and other provi-
sions of law which further the purposes of such
Act (as specified by the Secretary) are most ef-
fectively implemented in connection with the
provision of such assistance; and
‘‘(B) undiminished protection of the envi-
ronment to the public.
‘‘(2) BASIC AUTHORITY.—The Secretary may,
in lieu of the environmental protection procedures
HR 1433 IH2S
otherwise applicable and in accordance with the pro-
visions of this subsection, provided for the release of
funds for particular projects or activities upon the
request of a recipient of the assistance, if the State
or unit of general local government, as designated by
the Secretary, assumes all of the responsibilities for
environmental review, decisionmaking, and action
pursuant to the Act and the other provisions of law
referred to in paragraph (1) that would otherwise
apply to the Secretary in connection with the provi-
sion of capital grant assistance to such projects or
activities.
‘‘(3) PROCEDURE.—The Secretary shall ap-
prove the release of funds for projects or activities
subject to the procedures authorized by this sub-
section only if the recipient submits to the Secretary
a request for such release—
‘‘(A) not less than 15 days before such re-
lease, except that this paragraph shall not apply
in the case of a project or activity proposed in
an area covered by a declaration by the Presi-
dent of a major disaster or emergency under
the Robert T. Stafford Disaster Relief and
Emergency Assistance Act; and
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‘‘(B) before any commitment of funds or
other assistance for such projects (other than
for environmental studies and such other pur-
poses as the Secretary shall specify, consistent
with the Act and the other provisions of law re-
ferred to in paragraph (1)).
The request for release shall be accompanied by a
certification by the State or unit of general local
government which meets the requirements of para-
graph (4). The Secretary’s approval of any such cer-
tification shall be deemed to satisfy the Secretary’s
responsibilities under the Act and the other provi-
sions of law referred to in paragraph (1), insofar as
those responsibilities relate to the provision of cap-
ital grant assistance for projects to be carried out
pursuant thereto which are covered by the certifi-
cation.
‘‘(4) CERTIFICATION.—A certification under the
procedures authorized by this subsection shall—
‘‘(A) be in a form acceptable to the Sec-
retary;
‘‘(B) be executed by the chief executive of-
ficer or other officer of the State or unit of gen-
eral local government who qualifies as the cer-
tifying officer as determined by the Secretary;
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‘‘(C) specify that the State or unit of gen-
eral local government has fully carried out its
responsibilities, as described in paragraph (2);
and
‘‘(D) specify that the certifying officer—
‘‘(i) consents to assume the status of
a responsible Federal official under the Act
and the other provisions of law referred to
in paragraph (1), insofar as the provisions
of the Act or the other provisions of law
apply pursuant to paragraph (1); and
‘‘(ii) is authorized and consents on be-
half of the State or unit of general local
government himself or herself to accept the
jurisdiction of the Federal courts for the
purpose of enforcement of the responsibil-
ities as such an official.
‘‘(5) APPROVAL BY STATES.—If a unit of gen-
eral local government carries out the responsibilities
described in paragraph (4), the Secretary may per-
mit the State to perform those actions of the Sec-
retary described in paragraph (3). The performance
of such actions by the State shall be deemed to sat-
isfy the Secretary’s responsibilities referred to in the
last sentence of paragraph (3).
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‘‘(6) IMPLEMENTATION.—
‘‘(A) The Secretary shall implement this
subsection after consultation with the Council
on Environmental Quality. The implementation
shall include provision—
‘‘(i) for monitoring of the performance
of environmental reviews under this sub-
section;
‘‘(ii) in the discretion of the Secretary,
for the provision or facilitation of training
for such performance;
‘‘(iii) in the discretion of the Sec-
retary, for suspension or termination by
the Secretary of the assumption under
paragraph (1); and
‘‘(iv) in the discretion of the Sec-
retary, for the imposition of appropriate
sanctions for failure to comply with re-
sponsibilities assumed under this sub-
section, including the denial, withdrawal,
reduction, or abatement of assistance.
‘‘(B) The Secretary’s duty under subpara-
graph (A) shall not be construed to limit or re-
duce any responsibility assumed by a State or
100
HR 1433 IH2S
unit of general local government with respect to
any particular project under this subsection.’’.
(b) SUPPORTIVE HOUSING FOR PERSONS WITH DIS-
ABILITIES.—Section 811 of the Cranston-Gonzalez Na-
tional Affordable Housing Act is amended by adding at
the end the following new subsection:
‘‘(n) ENVIRONMENTAL PROTECTION.—
‘‘(1) PURPOSE.—The purpose of this subsection
is to authorize a procedure for the assumption of en-
vironmental review responsibilities of the Secretary
by States and units of general local government in
connection with assistance provided under subsection
(b)(2). This procedure shall be designed to ensure—
‘‘(A) that the policies of the National Envi-
ronmental Policy Act of 1969 and other provi-
sions of law which further the purposes of such
Act (as specified by the Secretary) are most ef-
fectively implemented in connection with the
provision of such assistance; and
‘‘(B) undiminished protection of the envi-
ronment to the public.
‘‘(2) BASIC AUTHORITY.—The Secretary may,
in lieu of the environmental protection procedures
otherwise applicable and in accordance with the pro-
visions of this subsection, provide for the release of
101
HR 1433 IH2S
funds for particular projects or activities upon the
request of a recipient of the assistance, if the State
or unit of general local government, as designated by
the Secretary, assumes all of the responsibilities for
environmental review, decisionmaking, and action
pursuant to the Act and the other provisions of law
referred to in paragraph (1) that would otherwise
apply to the Secretary in connection with the provi-
sion of assistance to such projects or activities.
‘‘(3) PROCEDURE.—The Secretary shall ap-
prove the release of funds for projects or activities
subject to the procedures authorized by this sub-
section only if the recipient submits to the Secretary
a request for such release—
‘‘(A) not less than 15 days before such re-
lease, except that this paragraph shall not apply
in the case of a project or activity proposed in
an area covered by a declaration by the Presi-
dent of a major disaster or emergency under
the Robert T. Stafford Disaster Relief and
Emergency Assistance Act; and
‘‘(B) before any commitment of funds or
other assistance for such projects (other than
for environmental studies and such other pur-
poses as the Secretary shall specify, consistent
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HR 1433 IH2S
with the Act and the other provisions of law re-
ferred to in paragraph (1)).
The request for release shall be accompanied by a
certification by the State or unit of general local
government which meets the requirements of para-
graph (4). The Secretary’s approval of any such cer-
tification shall be deemed to satisfy the Secretary’s
responsibilities under the Act and the other provi-
sions of law referred to in paragraph (1), insofar as
those responsibilities relate to the provision of assist-
ance for projects to be carried out pursuant thereto
which are covered by the certification.
‘‘(4) CERTIFICATION.—A certification under the
procedures authorized by this subsection shall—
‘‘(A) be in a form acceptable to the Sec-
retary;
‘‘(B) be executed by the chief executive of-
ficer or other officer of the State or unit of gen-
eral local government who qualifies as the cer-
tifying officer as determined by the Secretary;
‘‘(C) specify that the State or unit of gen-
eral local government has fully carried out its
responsibilities, as described in paragraph (2);
and
‘‘(D) specify that the certifying officer—
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HR 1433 IH2S
‘‘(i) consents to assume the status of
a responsible Federal official under the Act
and the other provisions of law referred to
in paragraph (1), insofar as the provisions
of the Act or the other provisions of law
apply pursuant to paragraph (1); and
‘‘(ii) is authorized and consents on be-
half of the State or unit of general local
government himself or herself to accept the
jurisdiction of the Federal courts for the
purpose of enforcement of the responsibil-
ities as such an official.
‘‘(5) APPROVAL BY STATES.—If a unit of gen-
eral local government carries out the responsibilities
described in paragraph (4), the Secretary may per-
mit the State to perform those actions of the Sec-
retary described in paragraph (3). The performance
of such actions by the State shall be deemed to sat-
isfy the Secretary’s responsibilities referred to in the
last sentence of paragraph (3).
‘‘(6) IMPLEMENTATION.—
‘‘(A) The Secretary shall implement this
subsection after consultation with the Council
on Environmental Quality. The implementation
shall include provision—
104
HR 1433 IH2S
‘‘(i) for monitoring of the performance
of environmental reviews under this sub-
section;
‘‘(ii) in the discretion of the Secretary,
for the provision or facilitation of training
for such performance;
‘‘(iii) in the discretion of the Sec-
retary, for suspension or termination by
the Secretary of the assumption under
paragraph (1); and
‘‘(iv) in the discretion of the Sec-
retary, for the imposition of appropriate
sanctions for failure to comply with re-
sponsibilities assumed under this sub-
section, including the denial, withdrawal,
reduction, or abatement of assistance.
‘‘(B) The Secretary’s duty under subpara-
graph (A) shall not be construed to limit or re-
duce any responsibility assumed by a State or
unit of general local government with respect to
any particular project under this subsection.’’.
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HR 1433 IH2S
SEC. 425. ASSIGNMENT OF REGULATORY AGREEMENTS IN
CONNECTION WITH SALE OF MORTGAGES
HELD BY HUD.
Section 203(k) of the Housing and Community De-
velopment Amendments of 1978 is amended by inserting
the following new paragraph at the end:
‘‘(7) ASSIGNMENT
OF
REGULATORY
AGREE-
MENTS
IN
CONNECTION
WITH
SALE
OF
MORT-
GAGES.—Notwithstanding any other provision of
law, and upon such terms and conditions as the Sec-
retary may prescribe, the Secretary may, in connec-
tion with the sale of mortgages held by the Sec-
retary, assign to the purchaser of the mortgage the
regulatory agreement executed by or for the benefit
of the Secretary and executed by the mortgagor.
Such regulatory agreement shall continue to be bind-
ing upon the mortgagor and its successors and as-
signs, and the Secretary and the successors and as-
signs of the Secretary.’’.
TITLE V—REHABILITATION
GRANTS
SEC. 501. CAPITAL GRANTS FOR SECTION 236 AND OTHER
FORMERLY INSURED PROJECTS.
Section 236 of the National Housing Act is amended
by adding at the end thereof the following new subsection:
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HR 1433 IH2S
‘‘(s)(1) GRANT AUTHORITY IN GENERAL.—The Sec-
retary may make grants for the capital costs of rehabilita-
tion to owners of projects that meet the eligibility and
other criteria set forth in, and in accordance with, this
subsection.
‘‘(2) PROJECT ELIGIBILITY.—A project may be eligi-
ble for capital grant assistance under this subsection if—
‘‘(A)(i) the project was insured section 236 or
any other provision of title II of the National Hous-
ing Act; and
‘‘(ii) the project was assisted under section 8 of
the United States Housing Act of 1937 on the date
of enactment of the Housing 2020: Multifamily
Management Reform Act;
‘‘(B) the project mortgage was not held by a
State agency as of the date of enactment of this Act;
‘‘(C) the project owner agrees to maintain the
housing quality standards that were in effect imme-
diately prior to the extinguishment of the mortgage
insurance under such title II;
‘‘(D) the Secretary determines that the owner
of the multifamily housing project has not engaged
in material adverse financial or managerial actions
or omissions with regard to the project; and with re-
gard to other projects, is not engaged in such ac-
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HR 1433 IH2S
tions or omissions that would constitute a pattern of
mismanagement that would warrant suspension or
debarment by the Secretary; and
‘‘(E) the project owner demonstrates to the sat-
isfaction of the Secretary—
‘‘(i) using information in a comprehensive needs
assessment, that capital grant assistance is needed
for rehabilitation of the project; and
‘‘(ii) that project income is not sufficient to
support such rehabilitation.
‘‘(3) ELIGIBLE PURPOSES.—The Secretary may
make grants to the owners of eligible projects for the
purposes of—
‘‘(A) payment into project replacement reserves;
‘‘(B) providing a fair return on equity invest-
ment;
‘‘(C) debt service payments on non-Federal re-
habilitation loans; and
‘‘(D) payment of non-recurring maintenance
and capital improvements, under terms and condi-
tions as determined by the Secretary.
‘‘(4) GRANT AGREEMENT.—
‘‘(A) The Secretary shall provide in any grant
agreement under this subsection that the grant shall
be terminated if the project fails to meet housing
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HR 1433 IH2S
that the Secretary has recaptured had continued in
accordance with the terms in effect immediately
prior to such extinguishment or write-down.’’.
Æ