I
103D CONGRESS
2D SESSION
H. R. 3838
To amend and extend certain laws relating to housing and community
development, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 10, 1994
Mr. GONZALEZ (for himself, Mrs. ROUKEMA, Mr. NEAL of North Carolina,
Mr. LAFALCE, Mr. VENTO, Mr. FRANK of Massachusetts, Mr. KAN-
JORSKI, Mr. KENNEDY, Mr. FLAKE, Mr. MFUME, Ms. WATERS, Mr. BAC-
CHUS of Florida, Mr. KLEIN, Mr. DEUTSCH, Mr. GUTIERREZ, Mr. RUSH,
Ms. VELA´ZQUEZ, Mr. WYNN, Mr. FIELDS of Louisiana, Mr. WATT, Mr.
HINCHEY, and Ms. Furse) introduced the following bill; which was re-
ferred to the Committee on Banking, Finance and Urban Affairs
APRIL 25, 1994
Additional sponsors: Mr. NEAL of Massachusetts, Mr. FOGLIETTA, and Mr.
SANDERS
A BILL
To amend and extend certain laws relating to housing and
community development, 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 AND TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Housing and Community Development Act of 1994’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows:
Sec. 1. Short title and table of contents.
Sec. 2. Effective date.
TITLE I—HOUSING ASSISTANCE
Subtitle A—General Provisions
Sec. 101. Low-income housing authorization.
Sec. 102. Definition of ‘‘families’’.
Sec. 103. Family self-sufficiency program.
Subtitle B—Public and Indian Housing
Sec. 111. Disallowance of earned income for residents who obtain employment.
Sec. 112. Ceiling rents.
Sec. 113. Major reconstruction of obsolete projects.
Sec. 114. New construction of projects for disabled families.
Sec. 115. Public housing operating subsidies.
Sec. 116. Elimination of requirement to identify CIAP replacement needs.
Sec. 117. Public housing vacancy reduction.
Sec. 118. Replacement housing for demolished or disposed public housing.
Sec. 119. Public housing resident management.
Sec. 120. Public housing family investment centers.
Sec. 121. Revitalization of severely distressed public housing.
Sec. 122. Applicability of public housing amendments to Indian housing.
Sec. 123. Public housing early childhood development services.
Sec. 124. Indian housing childhood development services.
Sec. 125. Public housing one-stop perinatal services demonstration.
Subtitle C—Section 8 Assistance
Sec. 141. Moving to opportunity for fair housing.
Sec. 142. Community investment demonstration program.
Sec. 143. Restatement and revision of section 8 rental assistance program.
Subtitle D—Homeownership Programs
Sec. 151. HOPE homeownership programs.
Sec. 152. National Homeownership Trust.
Sec. 153. Section 235 mortgage refinancing.
Subtitle E—Other Programs
Sec. 161. Community partnerships against crime.
Sec. 162. Public housing youth sports programs.
Sec. 163. Low-income housing preservation.
Sec. 164. Flexible subsidy program.
Sec. 165. Housing counseling.
Sec. 166. Preventing mortgage defaults on multifamily housing projects.
Sec. 167. Youthbuild program.
TITLE II—HOME INVESTMENT PARTNERSHIPS
Sec. 201. Authorization of appropriations.
Sec. 202. Participation by State agencies or instrumentalities.
Sec. 203. Simplification of program-wide income targeting for rental housing.
Sec. 204. Homeownership units.
Sec. 205. Comprehensive affordable housing strategy.
Sec. 206. Simplification of matching requirements.
Sec. 207. Repeal of separate audit requirement.
Sec. 208. Environmental review requirements.
Sec. 209. Use of CDBG funds for HOME program expenses.
Sec. 210. GAO study of use of HOME program funds.
Sec. 211. Capacity building for community development and affordable housing.
Sec. 212. Applicability and regulations.
TITLE III—SUPPORTIVE HOUSING PROGRAMS
Sec. 301. Funding for supportive housing for the elderly and for persons with
disabilities.
Sec. 302. Elder cottage housing demonstration program.
Sec. 303. Revised congregate services.
Sec. 304. Elderly independence demonstration.
Sec. 305. Housing opportunities for persons with AIDS.
Sec. 306. Service coordinators.
TITLE IV—MORTGAGE INSURANCE AND SECONDARY MORTGAGE
MARKET
Subtitle A—Mortgage Insurance and Loan Guarantee Programs
Sec. 401. Limitation on insurance authority.
Sec. 402. Federal Housing Administration Advisory Board.
Sec. 403. Home equity conversion mortgages for elderly homeowners.
Sec. 404. Multifamily housing financing programs.
Sec. 405. Indian housing loan guarantees.
Subtitle B—Multifamily Housing Property Disposition
Sec. 431. Short title.
Sec. 432. Disposition of multifamily housing projects owned by HUD.
Sec. 433. Clarification of public housing preferences.
Sec. 434. Amendment to National Housing Act.
Sec. 435. Effective date.
Subtitle C—Secondary Mortgage Market Programs
Sec. 451. Limitation on GNMA guarantees of mortgage-backed securities.
Subtitle D—Emergency Mortgage Relief
Sec. 471. Amendments to Emergency Homeowners’ Relief Act.
TITLE V—RURAL HOUSING
Sec. 501. Program authorizations.
Sec. 502. Section 502 homeownership loans.
Sec. 503. Prepayment of rural rental housing loans.
Sec. 504. Designation of underserved areas and reservation of assistance.
Sec. 505. Administrative appeals.
Sec. 506. Section 515 rural rental housing.
Sec. 507. Rental assistance payments.
Sec. 508. Rural housing assistance targeting report.
Sec. 509. Priority for rural housing voucher assistance.
Sec. 510. Native American rural housing capacity demonstration program.
Sec. 511. Rural community development initiative.
Sec. 512. Rural housing loan delegated processing demonstration.
TITLE VI—COMMUNITY DEVELOPMENT
Subtitle A—Community Development Block Grant Program
Sec. 601. Authorization of appropriations and guarantee authority.
Sec. 602. Economic development grants.
Sec. 603. Guarantee of obligations backed by section 108 loans.
Sec. 604. Section 108 loan guarantees for colonias.
Sec. 605. Assistance for colonias.
Subtitle B—Other Community Development Programs
Sec. 631. Neighborhood Reinvestment Corporation.
Sec. 632. John Heinz neighborhood development program.
TITLE VII—REGULATORY AND MISCELLANEOUS PROGRAMS
Sec. 701. Fair housing initiatives program.
Sec. 702. HUD program monitoring and research.
Sec. 703. HUD salaries and expenses.
Sec. 704. Subsidy layering review.
Sec. 705. HUD research and development.
Sec. 706. National Institute of Building Sciences.
Sec. 707. Residential lead-based paint hazard reduction.
Sec. 708. New towns demonstration program for emergency relief of Los An-
geles.
Sec. 709. Solar assistance financing entity.
Sec. 710. National American Indian Housing Council.
Sec. 711. Housing Assistance Council.
TITLE VIII—HOUSING PROGRAMS UNDER STEWART B. MCKINNEY
HOMELESS ASSISTANCE ACT
Sec. 801. Short title.
Subtitle A—Housing Assistance
Sec. 811. Emergency shelter grants program.
Sec. 812. Supportive housing program.
Sec. 813. Safe havens for homeless individuals demonstration program.
Sec. 814. Section 8 assistance for single room occupancy dwellings.
Sec. 815. Shelter plus care program.
Sec. 816. Rural homelessness grant program.
Sec. 817. Strategy to eliminate unfit transient facilities.
Sec. 818. Innovative homeless initiatives demonstration program.
Subtitle B—Interagency Council on the Homeless
Sec. 831. Authorization of appropriations.
Sec. 832. Extension.
Subtitle C—Federal Emergency Management Food and Shelter Program
Sec. 851. Authorization of appropriations.
SEC. 2. EFFECTIVE DATE.
The provisions of this Act and the amendments made
by this Act shall take effect and shall apply upon the date
of the enactment of this Act, unless such provisions or
amendments specifically provide for effectiveness or appli-
cability upon another date certain.
TITLE I—HOUSING ASSISTANCE
Subtitle A—General Provisions
SEC. 101. LOW-INCOME HOUSING AUTHORIZATION.
(a) AGGREGATE
BUDGET
AUTHORITY.—Section
5(c)(6) of the United States Housing Act of 1937 (42
U.S.C. 1437c(c)(6)) is amended by adding at the end the
following new sentence: ‘‘The aggregate amount of budget
authority that may be obligated for assistance referred to
in paragraph (7) is increased (to the extent approved in
appropriation Acts) by $8,603,634,603 on October 1,
1994, and by $8,860,274,842 on October 1, 1995.’’.
(b) UTILIZATION OF BUDGET AUTHORITY.—Section
5(c)(7) of the United States Housing Act of 1937 (42
U.S.C. 1437c(c)(7)) is amended by striking the paragraph
designation and all that follows through the end of sub-
paragraph (B) and inserting the following:
‘‘(7)(A) Using the additional budget authority pro-
vided under paragraph (6) and the balances of budget au-
thority that become available during fiscal year 1995, the
Secretary shall, to the extent approved in appropriation
Acts, reserve authority to enter into obligations aggregat-
ing—
‘‘(i) for public housing grants under subsection
(a)(2), not more than $891,772,592, of which
amount not more than $276,171,263 shall be avail-
able for Indian housing;
‘‘(ii) for assistance under section 8, not more
than $2,122,546,291, of which $20,000,000 shall be
available for 15-year contracts for project-based as-
sistance to be used for a multicultural tenant
empowerment and homeownership project located in
the District of Columbia;
‘‘(iii) for assistance under section 5(j)(2) for
substantial redesign, reconstruction, and redevelop-
ment of existing obsolete public housing projects and
buildings, not more than $122,776,000;
‘‘(iv) for comprehensive improvement assistance
grants 
under 
section 
14(k), 
not 
more 
than
$3,327,106,000;
‘‘(v) for assistance under section 8 for family
unification under subsection (q)(3) of such section,
not more than $107,326,000;
‘‘(vi) for assistance under section 8(o)(4) for
families utilizing the portability of assistance under
section 8, $100,000,000;
‘‘(vii) for assistance under section 8 for prop-
erty disposition, not more than $571,650,000;
‘‘(viii) for assistance under section 8 for loan
management, not more than $216,798,520;
‘‘(ix) for extensions of contracts expiring under
section 8, such sums as may be necessary, which
shall be for 5-year contracts for assistance under
section 8 and vouchers under section 8(o) (as in ef-
fect before the date of the enactment of this Act)
and for loan management assistance under such sec-
tion;
‘‘(x) for amendments to contracts under section
8, such sums as may be necessary;
‘‘(xi) for adjustments to annual contributions
contracts for public housing and section 8 assistance
for the costs of providing service coordinators under
sections 9(a)(1)(B)(ii), 8(i)(4), and 8(n)(3), not
more than $93,112,000;
‘‘(xii) for public housing lease adjustments and
amendments, such sums as may be necessary;
‘‘(xiii) for assistance under section 18(e) for re-
placement housing for units demolished or disposed
of under section 18, not more than $200,000,000, of
which not more than 75 percent shall be available
for providing public housing units and not more
than 25 percent shall be available for providing as-
sistance under section 8;
‘‘(xiv) for conversions from leased housing con-
tracts under section 23 of this Act (as in effect im-
mediately before the enactment of the Housing and
Community Development Act of 1974) to assistance
under section 8, not more than $3,960,000; and
‘‘(xv) for grants under section 24 for revitaliza-
tion of severely distressed public housing, not more
than $801,587,200.
‘‘(B) Using the additional budget authority provided
under paragraph (6) and the balances of budget authority
that become available during fiscal year 1996, the Sec-
retary shall, to the extent approved in appropriation Acts,
reserve authority to enter into obligations aggregating—
‘‘(i) for public housing grants under subsection
(a)(2), not more than $918,525,770, of which
amount not more than $284,456,401 shall be avail-
able for Indian housing;
‘‘(ii) for assistance under section 8, not more
than $2,186,222,680, of which $20,000,000 shall be
available for 15-year contracts for project-based as-
sistance to be used for a multicultural tenant
empowerment and homeownership project located in
the District of Columbia;
‘‘(iii) for assistance under section 5(j)(2) for
substantial redesign, reconstruction, and redevelop-
ment of existing obsolete public housing projects and
buildings, not more than $126,459,280;
‘‘(iv) for comprehensive improvement assistance
grants 
under 
section 
14(k), 
not 
more 
than
$3,426,919,180;
‘‘(v) for assistance under section 8 for family
unification under subsection (q)(3) of such section,
not more than $110,545,780;
‘‘(vi) for assistance under section 8(o)(4) for
families utilizing the portability of assistance under
section 8, $103,000,000;
‘‘(vii) for assistance under section 8 for prop-
erty disposition, not more than $588,799,500;
‘‘(viii) for assistance under section 8 for loan
management, not more than $223,302,476;
‘‘(ix) for extensions of contracts expiring under
section 8, such sums as may be necessary, which
shall be for 5-year contracts for assistance under
section 8 and vouchers under section 8(o) (as in ef-
fect before the date of the enactment of this Act)
and for loan management assistance under such sec-
tion;
‘‘(x) for amendments to contracts under section
8, such sums as may be necessary;
‘‘(xi) for adjustments to annual contributions
contracts for public housing and section 8 assistance
for the costs of providing service coordinators under
sections 9(a)(1)(B)(ii), 8(i)(4), and 8(n)(3), not
more than $95,905,360;
‘‘(xii) for public housing lease adjustments and
amendments, such sums as may be necessary;
‘‘(xiii) for assistance under section 18(e) for re-
placement housing for units demolished or disposed
of under section 18, not more than $206,000,000, of
which not more than 75 percent shall be available
for providing public housing units and not more
than 25 percent shall be available for providing as-
sistance under section 8;
‘‘(xiv) for conversions from leased housing con-
tracts under section 23 of this Act (as in effect im-
mediately before the enactment of the Housing and
Community Development Act of 1974) to assistance
under section 8, not more than $3,960,000; and
‘‘(xv) for grants under section 24 for revitaliza-
tion of severely distressed public housing, not more
than $825,634,816.’’.
SEC. 102. DEFINITION OF ‘‘FAMILIES’’.
The first sentence of section 3(b)(3)(B) of the United
States Housing Act of 1937 (42 U.S.C. 1437a(b)(3)(B))
is amended by striking ‘‘means families with children’’ and
inserting ‘‘includes families with children and’’.
SEC. 103. FAMILY SELF-SUFFICIENCY PROGRAM.
(a) FUNDING.—The last sentence of section 23(h)(2)
of the United States Housing Act of 1937 (42 U.S.C.
1437u(h)(2)) is amended to read as follows: ‘‘There are
authorized to be appropriated for costs under this para-
graph $26,677,000 for fiscal year 1995 and $27,477,310
for fiscal year 1996.’’.
(b) VOLUNTARY ESCROW SAVINGS ACCOUNT.—Sec-
tion 23(d) of the United States Housing Act of 1937 (42
U.S.C. 1437u(d)) is amended—
(1) in paragraph (2)—
(A) in the 1st sentence, by striking ‘‘shall’’
and inserting ‘‘may’’;
(B) in the 2nd sentence, by inserting after
‘‘area median income’’ the following: ‘‘that
choose to escrow amounts under this para-
graph’’;
Subtitle B—Public and Indian
Housing
SEC. 111. DISALLOWANCE OF EARNED INCOME FOR RESI-
DENTS WHO OBTAIN EMPLOYMENT.
(a) IN GENERAL.—Section 3 of the United States
Housing Act of 1937 (42 U.S.C. 1437a) is amended by
striking the undesignated paragraph at the end of sub-
section (c)(3) (as added by section 515(b) of the Cranston-
Gonzalez National Affordable Housing Act) and inserting
the following new subsection:
‘‘(d) DISALLOWANCE
OF EARNED INCOME FROM
PUBLIC HOUSING RENT DETERMINATIONS.—
‘‘(1) IN GENERAL.—Subject only to paragraph
(2), the rent payable under subsection (a) for any
public housing unit by a family whose income in-
creases as a result of employment of a member of
the family who was previously unemployed for one or
more years may not be increased for a period of 18
months (beginning upon the commencement of em-
ployment) as a result of the increased income due to
such employment.
‘‘(2) BUDGET
COMPLIANCE.—To the extent
that paragraph (1) results in additional costs under
this Act, the provisions of such paragraph shall be
effective only to the extent that amounts to cover
such additional costs are provided in advance in ap-
propriation Acts.’’.
(b) APPLICABILITY OF AMENDMENT.—Notwithstand-
ing the amendment made by subsection (a), any resident
of public housing participating in the program under the
authority contained in the undesignated paragraph at the
end of section 3(c)(3) of the United States Housing Act
of 1937 (as such paragraph existed before the date of en-
actment of this subsection) shall continue to be governed
by such authority.
(c) CONFORMING AMENDMENT.—Section 957(a) of
the Cranston-Gonzalez National Affordable Housing Act
(42 U.S.C. 12714(a)) is amended by striking ‘‘Notwith-
standing any other law and subject’’ and inserting ‘‘Sub-
ject only to the provisions of section 3(d) of the United
States Housing Act of 1937 and’’.
SEC. 112. CEILING RENTS.
(a) DETERMINATION BASED UPON REASONABLE
RENTAL VALUE.—Section 3(a)(2)(A)(iii) of the United
States 
Housing 
Act 
of 
1937 
(42 
U.S.C.
1437a(a)(2)(A)(iii)) is amended to read as follows:
‘‘(iii) is not less than the reasonable rental
value of the unit, as determined by the Secretary.’’.
(b) LIMITATION
OF BENEFIT DERIVED.—Section
3(a)(2) of the United States Housing Act of 1937 is
amended—
(1) in subparagraph (A), by striking ‘‘Any’’ and
inserting ‘‘Except as provided in subparagraph (B),
any’’;
(2) by redesignating subparagraph (B) as sub-
paragraph (C); and
(3) by inserting after subparagraph (A) the fol-
lowing new subparagraph:
‘‘(B) A public housing agency may not determine the
monthly rent under subparagraph (A) for any family re-
siding in a public housing project of the agency who, for
the entire duration of a period of 36 consecutive months
(such period beginning after the date of the enactment of
the Housing and Community Development Act of 1994),
has (i) had an income exceeding the income of a low-
income family, and (ii) has paid as monthly rent for a
dwelling unit in any project administered by the agency
an amount determined pursuant to subparagraph (A). The
monthly rent for a dwelling unit in public housing for such
a family shall be the amount determined under paragraph
(1).’’.
(c) REGULATIONS.—The Secretary shall, by notice
published in the Federal Register, establish such require-
ments as may be necessary to carry out the provisions of
subparagraphs (A) and (B) of section 3(a)(2) of the
United States Housing Act of 1937, as amended by this
section. The Secretary shall issue final regulations to carry
out the provisions of such section, based on such notice,
after providing opportunity for public comment on the no-
tice.
SEC. 
113. 
MAJOR 
RECONSTRUCTION 
OF 
OBSOLETE
PROJECTS.
(a) ASSISTANCE
FOR RECONSTRUCTION.—Section
5(j)(2) of the United States Housing Act of 1937 (42
U.S.C. 1437c(j)(2)) is amended—
(1) in subparagraph (A), by striking ‘‘Notwith-
standing’’ and all that follows through ‘‘fiscal year’’
and inserting the following: ‘‘The Secretary may
provide assistance under this paragraph’’;
(2) in subparagraph (C), by striking ‘‘reserved’’
and inserting ‘‘made available for assistance’’;
(3) in subparagraph (F)(i), by striking ‘‘re-
served or’’; and
(4) in subparagraph (G)(i), by striking ‘‘re-
served under subparagraph (A)’’ and inserting
‘‘made available for use under this paragraph’’.
(b) SET-ASIDE FOR DISABLED FAMILIES.—Section
5(j)(2)(G)(i) of the United States Housing Act of 1937
(42 U.S.C. 1437c(j)(2)(G)(i)) is amended by striking ‘‘fis-
cal years 1993 and 1994’’ and inserting ‘‘fiscal years 1995
and 1996’’.
SEC. 114. NEW CONSTRUCTION OF PROJECTS FOR DIS-
ABLED FAMILIES.
Section 5(j)(3)(A) of the United States Housing Act
of 1937 (42 U.S.C. 1437c(j)(3)(A)) is amended by strik-
ing ‘‘fiscal years 1993 and 1994’’ and inserting ‘‘fiscal
years 1995 and 1996’’.
SEC. 115. PUBLIC HOUSING OPERATING SUBSIDIES.
Section 9(c) of the United States Housing Act of
1937 (42 U.S.C. 1437g(c)) is amended—
(1) in paragraph (1), by striking ‘‘There’’ and
all that follows and inserting the following new sen-
tence: ‘‘There are authorized to be appropriated for
purposes of providing annual contributions under
this section $2,750,000,000 for fiscal year 1995 and
$2,832,500,000 for fiscal year 1996.’’.
(2) in paragraph (2), by striking ‘‘1993 and
1994’’ and inserting ‘‘1995 and 1996’’; and
(3) in paragraph (3), by striking ‘‘1993 and
1994’’ and inserting ‘‘1995 and 1996’’.
SEC. 116. ELIMINATION OF REQUIREMENT TO IDENTIFY
CIAP REPLACEMENT NEEDS.
Section 14 of the United States Housing Act of 1937
(42 U.S.C. 1437l) is amended—
(1) in subsection (d)—
(A) by striking paragraph (2);
(B) in paragraph (4), in the matter pre-
ceding subparagraph (A)—
(i) by striking ‘‘and replacements,’’;
and
(ii) by striking ‘‘(1), (2), and (3)’’ and
inserting ‘‘(1) and (2)’’; and
(C) by redesignating paragraphs (3) and
(4) as paragraphs (2) and (3), respectively; and
(2) in subsection (f)(1)—
(A) in subparagraph (A), by striking
‘‘(d)(4)(A)’’ and inserting ‘‘(d)(3)(A)’’;
(B) by striking subparagraph (B);
(C) in subparagraph (C), by striking
‘‘(d)(4)’’ and inserting ‘‘(d)(3)’’; and
(D) in subparagraph (D)—
(i) by striking ‘‘(1), (2), and (3)’’ and
inserting ‘‘(1) and (2)’’; and
(ii) by striking ‘‘(d)(4)’’ and inserting
‘‘(d)(3)’’;
(3) in subsection (g), by striking ‘‘(d)(4)’’ and
inserting ‘‘(d)(3)’’; and
(4) in subsection (h)(2), by striking ‘‘(d)(4)’’
and inserting ‘‘(d)(3)’’.
SEC. 117. PUBLIC HOUSING VACANCY REDUCTION.
Section 14(p)(6)(A) of the United States Housing
Act of 1937 (42 U.S.C. 1437l(p)(6)(A)) is amended by
striking ‘‘fiscal years 1993 and 1994’’ and inserting ‘‘fis-
cal years 1995 and 1996’’.
SEC. 118. REPLACEMENT HOUSING FOR DEMOLISHED OR
DISPOSED PUBLIC HOUSING.
Section 18(e) of the United States Housing Act of
1937 (42 U.S.C. 1437p) is amended to read as follows:
‘‘(e) ASSISTANCE FOR REPLACEMENT HOUSING.—
The Secretary may provide assistance under this sub-
section for—
‘‘(1) providing replacement public housing units
pursuant to subsection (b)(3)(A) for units demol-
ished or disposed of pursuant to this section; and
‘‘(2) providing assistance under section 8 for
replacement 
housing 
pursuant 
to 
subsection
(b)(3)(A) for units demolished or disposed of pursu-
ant to this section.’’.
SEC. 119. PUBLIC HOUSING RESIDENT MANAGEMENT.
Section 20(f)(3) of the United States Housing Act
of 1937 (42 U.S.C. 1437r(f)(3)) is amended to read as
follows:
‘‘(3) AUTHORIZATION
OF
APPROPRIATIONS.—
There are authorized to be appropriated to carry out
this subsection $5,000,000 for fiscal year 1995 and
$5,000,000 for fiscal year 1996.’’.
SEC. 120. PUBLIC HOUSING FAMILY INVESTMENT CENTERS.
Section 22(k) of the United States Housing Act of
1937 (42 U.S.C. 1437t(k)) is amended to read as follows:
‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated to carry out this section
$26,831,500 for fiscal year 1995 and $27,636,445 for fis-
cal year 1996.’’.
SEC. 121. REVITALIZATION OF SEVERELY DISTRESSED PUB-
LIC HOUSING.
(a) PLANNING GRANTS.—Subsection (c) of section 24
of the United States Housing Act of 1937 (42 U.S.C.
1437v(c)) is amended—
(1) in paragraph (2) by striking ‘‘$200,000’’
and inserting ‘‘$500,000’’;
(2) in paragraph (3)—
(A) by redesignating subparagraphs (E)
through (I) as subparagraphs (F) through (J),
respectively; and
(B) by inserting after subparagraph (D)
the following new subparagraph:
‘‘(E) planning for community service ac-
tivities to be carried out by residents, other
members of the community, and other persons
willing to contribute to the social, economic, or
physical improvement of the community;’’; and
(3) in paragraph (4)—
(A) by redesignating subparagraphs (D)
and (E) as subparagraphs (E) and (F), respec-
tively; and
(B) by inserting after subparagraph (C)
the following new subparagraph:
‘‘(D) to the extent the applicant is request-
ing amounts for community service activities, a
description of the planning activities for com-
munity service to be carried out by residents,
other members of the community, and other
persons willing to contribute to the social, eco-
nomic, or physical improvement of the commu-
nity;’’.
(b) IMPLEMENTATION GRANTS.—Subsection (d) of
section 24 of the United States Housing Act of 1937 is
amended—
(1) in paragraph (2)—
(A) in subparagraph (I), by striking ‘‘ex-
cept that’’ and all that follows and inserting the
following: ‘‘except that—
‘‘(i) not more than 20 percent of any
grant under this subsection may be used
for such purpose; and
‘‘(ii) an amount equal to 15 percent of
the amount of any grant under this sub-
section used for such purposes shall be
contributed from non-Federal sources, and
may be in the form of cash, administrative
costs, and the reasonable value of in-kind
contributions, and may include funding
under title I of the Housing and Commu-
nity Development Act of 1974.’’;
(B) by redesignating subparagraphs (E)
through (I) (as so amended) as subparagraphs
(F) through (J), respectively; and
(C) by inserting after subparagraph (D)
the following new subparagraph:
‘‘(E) community service activities to be
carried out by residents, other members of the
community, and other persons willing to con-
tribute to the social, economic, or physical im-
provement of the community;’’;
(2) in paragraph (3)—
(A) by redesignating subparagraphs (D)
and (E) as subparagraphs (E) and (F), respec-
tively; and
(B) by inserting after subparagraph (C)
the following new subparagraph:
‘‘(D) to the extent the applicant is request-
ing amounts for community service activities, a
description of the community service activities
to be carried out by residents, other members
of the community, and other persons willing to
contribute to the social, economic, or physical
improvement of the community;’’; and
(3) in paragraph (4)(D), by striking ‘‘the po-
tential of the applicant for developing a successful
and affordable’’ and inserting ‘‘the quality of the
proposed’’.
(c) DEFINITIONS.—Subsection (h) of section 24 of
the United States Housing Act of 1937 is amended—
(1) by striking paragraph (5) and inserting the
following new paragraphs:
‘‘(6) SEVERELY
DISTRESSED
PUBLIC
HOUS-
ING.—The term ‘severely distressed public housing’
means a public housing project or building in a
project that—
‘‘(A) requires major redesign, reconstruc-
tion, or redevelopment, or partial or total demo-
lition, to correct serious deficiencies in the
original design (including inappropriately high
population 
density), 
deferred 
maintenance,
physical deterioration or obsolescence or major
systems, and other deficiencies in the physical
plant of the project;
‘‘(B) is—
‘‘(i)(I) occupied predominantly by
families with children which have extremely
low incomes, high rates of unemployment,
and extensive dependency on various forms
of public assistance; and
‘‘(II) has high rates of vandalism and
criminal activity (including drug-related
criminal activity); or
‘‘(ii) has a vacancy rate, as deter-
mined by the Secretary, of 50 percent or
more;
‘‘(C) can not be revitalized through assist-
ance under other programs, such as the pro-
grams under sections 9 and 14, or through
other administrative means because of the inad-
equacy of available amounts; and
‘‘(D) in the case of an individual building,
the building is (in the determination of the Sec-
retary) sufficiently separable from the remain-
der of the project of which the building is part
to make use of the building feasible for pur-
poses of this section.
‘‘(7) SUPPORT SERVICES.—The term ‘support
services’ includes all activities which will promote
upward mobility, self-sufficiency, and improved qual-
ity of life for the residents of the public housing
project involved, and shall include literacy training,
job training, day care, and economic development ac-
tivities. Support services may be provided to resi-
dents of the neighborhood in which the public hous-
ing project involved is located.’’;
(2) by redesignating paragraphs (2) through
(4) as paragraphs (3) through (5), respectively; and
(3) by inserting after paragraph (1) the follow-
ing new paragraph:
‘‘(2) COMMUNITY SERVICE.—The term ‘commu-
nity service’ means services provided on a volunteer
or limited stipend basis for the social, economic, or
physical improvement of the community to be
served, including opportunity for the upward mobil-
ity of participants providing the community service,
through completion of education requirements, job
training, or alternative methods of developing skills
and job readiness.’’.
SEC. 122. APPLICABILITY OF PUBLIC HOUSING AMEND-
MENTS TO INDIAN HOUSING.
(a) AMENDMENT.—Section 201(b) of the United
States Housing Act of 1937 (42 U.S.C. 1437aa(b)) is
amended to read as follows:
‘‘(b) APPLICABILITY OF TITLE I.—Except as other-
wise provided by law, the provisions of title I shall apply
to low-income housing developed or operated pursuant to
a contract between the Secretary and an Indian housing
authority.’’.
(b) APPLICABILITY OF AMENDMENT.—The amend-
ment made by subsection (a) shall not affect provisions
of the United States Housing Act of 1937 that were made
applicable to public housing developed or operated pursu-
ant to a contract between the Secretary and an Indian
housing authority in accordance with section 201(b)(2) of
such Act, as such section existed before the effective date
of this section.
(c) APPLICABILITY OF HOUSING AND COMMUNITY
DEVELOPMENT ACT OF 1992.—Sections 103(a)(1), 112,
114, 116, 118, 903, and 927 of the Housing and Commu-
nity Development Act of 1992 shall apply to public hous-
ing developed or operated pursuant to a contract between
the Secretary and an Indian housing authority.
SEC. 123. PUBLIC HOUSING EARLY CHILDHOOD DEVELOP-
MENT SERVICES.
Section 222(g) of the Housing and Urban-Rural Re-
covery Act of 1983 (12 U.S.C. 1701z–6 note) is amended
to read as follows:
‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated to carry out this section
$15,000,000 for fiscal year 1995 and $15,450,000 for fis-
cal year 1996. Any amounts appropriated to carry out this
section shall remain available until expended.’’.
SEC. 124. INDIAN HOUSING CHILDHOOD DEVELOPMENT
SERVICES.
(a) FUNDING.—Section 518(a) of the Cranston-Gon-
zalez National Affordable Housing Act (12 U.S.C. 1701z–
6 note) is amended by striking the first and second sen-
tences and inserting the following new sentence: ‘‘There
are authorized to be appropriated to carry out the dem-
onstration program under this section $5,580,540 for fis-
cal year 1995 and $5,747,956 for fiscal year 1996.’’.
SEC. 125. PUBLIC HOUSING ONE-STOP PERINATAL SERV-
ICES DEMONSTRATION.
Section 521(g) of the Cranston-Gonzalez National
Affordable Housing Act (42 U.S.C. 1437t note) is amend-
ed to read as follows:
‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated for carrying out the
demonstration program under this section $214,652 for
fiscal year 1995 and $221,092 for fiscal year 1996.’’.
Subtitle C—Section 8 Assistance
SEC. 141. MOVING TO OPPORTUNITY FOR FAIR HOUSING.
(a) AUTHORIZATION OF APPROPRIATIONS.—Section
152(e) of the Housing and Community Development Act
of 1992 (42 U.S.C. 1437f note) is amended by striking
the first sentence and inserting the following new sen-
tence: ‘‘The budget authority available under section 5(c)
of the United States Housing Act of 1937 for tenant-
based assistance under section 8 of such Act is authorized
to be increased by $176,387,500, on or after October 1,
1994, and by $181,679,125, on or after October 1, 1995,
to carry out the demonstration under this section.’’.
(b) COUNSELING.—The second sentence of section
106(a)(3) of the Housing and Urban Development Act of
1968 (12 U.S.C. 1701x(a)(3)) is amended to read as fol-
lows: ‘‘Of the amounts appropriated for purposes of this
subsection for each of fiscal years 1995 and 1996, up to
$500,000 shall be available for use for counseling and
other activities in connection with the demonstration pro-
gram under section 152 of the Housing and Community
Development Act of 1992.’’.
SEC. 142. COMMUNITY INVESTMENT DEMONSTRATION PRO-
GRAM.
Section 6(j) of the HUD Demonstration Act of 1993
(42 U.S.C. 1437f note) is amended to read as follows:
‘‘(j) AUTHORIZATION OF APPROPRIATIONS.—There
are authorized to be appropriated to carry out this section
$103,000,000 for fiscal year 1995 and $106,090,000 for
fiscal year 1996.’’.
SEC. 143. RESTATEMENT AND REVISION OF SECTION 8
RENTAL ASSISTANCE PROGRAM.
(a) IN GENERAL.—Section 8 of the United States
Housing Act of 1937 (42 U.S.C. 1437f) is amended to
read as follows:
‘‘RENTAL HOUSING ASSISTANCE FOR LOW-INCOME
FAMILIES
‘‘SEC. 8. (a) AUTHORITY AND PURPOSE.—
‘‘(1) IN GENERAL.—For the purposes of aiding
low-income families in obtaining a decent place to
live and promoting economically mixed housing, the
Secretary may provide assistance payments with re-
spect to existing housing in accordance with the pro-
visions of this section.
‘‘(2) ELDERLY HOUSING.—Notwithstanding any
other provision of this Act, assistance payments
under this section may be provided, in accordance
with regulations prescribed by the Secretary, with
respect to some or all of the units in any project ap-
proved pursuant to section 202 of the Housing Act
of 1959 (as in effect before October 1, 1991).
‘‘(b) ANNUAL
CONTRIBUTIONS
CONTRACTS
FOR
RENTAL ASSISTANCE.—
‘‘(1) IN GENERAL.—The Secretary may enter
into annual contributions contracts under this sub-
section with public housing agencies to provide rent-
al housing assistance under this section for low-in-
come families. The Secretary shall enter into a sepa-
rate annual contributions contract with each public
housing agency to obligate the authority approved
each year. Each such annual contributions contract
shall bind the Secretary to make such authority, and
any amendments increasing such authority, available
to the public housing agency for a specified period.
‘‘(2) SECRETARY
ACTING
AS
PHA.—In areas
where no public housing agency has been organized
or where the Secretary determines that a public
housing agency is unable to implement the provi-
sions of this section, the Secretary may enter into
such contracts and perform the other functions as-
signed to a public housing agency by this section.
‘‘(3) TREATMENT
OF
ASSISTANCE
FOR
SUP-
PORTIVE HOUSING FOR THE DISABLED.—The Sec-
retary may not consider the receipt by a public hous-
ing agency of assistance under section 811(b)(1) of
the Cranston-Gonzalez National Affordable Housing
Act, or the amount received, in approving assistance
under this section for the agency or in determining
the amount of such assistance to be provided to the
agency.
‘‘(c) ASSISTANCE CONTRACTS.—
‘‘(1) IN GENERAL.—Each public housing agen-
cy that receives amounts under an annual contribu-
tions contract may enter into assistance contracts to
make rental assistance payments to owners of exist-
ing dwelling units in accordance with the provisions
of this section.
‘‘(2) PHA ACTING AS OWNER.—A public hous-
ing agency may contract to make rental assistance
payments under this section to itself (or any agency
or instrumentality thereof) as the owner of dwelling
units, and the agency shall be subject to the same
program requirements as are applied to other own-
ers. In such cases, the Secretary may establish ini-
tial rents within applicable limits.
‘‘(3) INAPPLICABLE PROVISIONS.—Sections 5(e)
and 6 and any other provisions of this Act that are
inconsistent with the provisions of this section shall
not apply to assistance contracts entered into pursu-
ant to this section.
‘‘(d) MAXIMUM MONTHLY RENT.—
‘‘(1) IN
GENERAL.—Each assistance contract
entered into pursuant to this section shall establish
the maximum monthly rent (including utilities and
all maintenance and management charges) that the
owner is entitled to receive for each dwelling unit for
which rental assistance payments are to be made
under the contract. Except as provided in paragraph
(2), the maximum monthly rent shall not exceed by
more than 10 percent the fair market rental under
subsection (e) for the market area in which the
dwelling unit is located. If units assisted under this
section are exempt from local rent control while they
are so assisted or otherwise, the maximum monthly
rent for such units shall be reasonable in comparison
with other units in the market area that are exempt
from local rent control.
‘‘(2) EXCEPTION.—The maximum monthly rent
may exceed the fair market rental by more than 10
but not more than 20 percent, but only if the Sec-
retary determines that special circumstances warrant
such higher maximum rent or that such higher rent
is necessary to the implementation of a comprehen-
sive housing affordability strategy under section 105
of the Cranston-Gonzalez National Affordable Hous-
ing Act.
‘‘(3) ANNUAL ADJUSTMENTS.—Each assistance
contract shall provide for adjustment in the maxi-
mum monthly rents for units covered by the contract
not less than annually to reflect changes in the fair
market rentals established under subsection (e) for
the housing area for similar types and sizes of dwell-
ing units or, if the Secretary determines, on the
basis of a reasonable formula.
‘‘(4) ADJUSTMENTS DUE TO EXPENSES.—Each
assistance contract shall further provide for the Sec-
retary to make additional adjustments in the maxi-
mum monthly rent for units assisted under the con-
tract to the extent the Secretary determines such ad-
justments are necessary to reflect increases in the
actual and necessary expenses of owning and main-
taining the units that have resulted from substantial
general increases in real property taxes, utility rates,
or similar costs that are not adequately compensated
for by the adjustment in the maximum monthly rent
authorized by paragraph (3). The Secretary shall
make additional adjustments in the maximum
monthly rent for units under contract (subject to the
availability of appropriations for contract amend-
ments) to the extent the Secretary determines such
adjustments are necessary to reflect increases in the
actual and necessary expenses of owning and main-
taining the units that have resulted from the expira-
tion of a real property tax exemption.
‘‘(5) ADJUSTMENTS DUE TO CRIMINAL ACTIV-
ITY.—If the Secretary determines that a project as-
sisted under this section is located in a community
where criminal activity is generally prevalent and the
operating, maintenance, and capital repair expenses
for the project have been substantially increased pri-
marily as a result of the prevalence of such activity,
the Secretary may (at the discretion of the Secretary
and subject to the availability of appropriations for
contract amendments for this purpose), on a project-
by-project basis, provide adjustments to the maxi-
mum monthly rents, to a level not exceeding 120
percent of the project rents, to cover the costs of
maintenance, security, capital repairs, and reserves
required for the owner to carry out a strategy ac-
ceptable to the Secretary for addressing the problem
of criminal activity. The Secretary may waive the
applicability of any rent comparability standard re-
quired under this subsection to implement this para-
graph.
‘‘(6) ADJUSTMENTS
DUE
TO
LEAD-BASED
PAINT
REDUCTION
FOR
HOUSING
RECEIVING
PROJECT-BASED
ASSISTANCE.—The Secretary may
(at the discretion of the Secretary and subject to the
availability of appropriations for contract amend-
ments), on a project-by-project basis for projects re-
ceiving project-based assistance, provide adjustments
to the maximum monthly rents to cover the costs of
evaluating and reducing lead-based paint hazards, as
defined in section 1004 of the Residential Lead-
Based Paint Hazard Reduction Act of 1992.
‘‘(7) LIMITATIONS ON ADJUSTMENTS.—
‘‘(A) GENERAL
COMPARABILITY
RULE.—
Adjustments in the maximum rents under para-
graphs (3) through (6) shall not result in mate-
rial differences between the rents charged for
assisted units and unassisted units of similar
quality, type, and age in the same market area,
as determined by the Secretary.
‘‘(B) COMPARABILITY STUDIES.—
‘‘(i) To carry out subparagraph (A),
the Secretary shall issue regulations to
provide for conducting comparability stud-
ies for projects where the Secretary has
reason to believe that the application of the
formula adjustments under paragraph (3)
would result in such material differences.
The Secretary shall conduct such studies
upon the request of any owner of any
project, or as the Secretary determines to
be appropriate by establishing, to the ex-
tent practicable, a modified annual adjust-
ment factor for such market area, as the
Secretary shall designate, that is geo-
graphically smaller than the applicable
housing area used for the establishment of
the annual adjustment factor under para-
graph (3). The Secretary shall establish
such modified annual adjustment factor on
the basis of the results of a study con-
ducted by the Secretary of the rents
charged, and any change in such rents
over the previous year, for assisted units
and unassisted units of similar quality,
type, and age in the smaller market area.
Where the Secretary determines that such
modified annual adjustment factor cannot
be established or that such factor when ap-
plied to a particular project would result in
material differences between the rents
charged for assisted units and unassisted
units of similar quality, type, and age in
the same market area, the Secretary may
apply an alternative methodology for con-
ducting comparability studies in order to
establish rents that are not materially dif-
ferent from rents charged for comparable
unassisted units.
‘‘(ii) If the Secretary or appropriate
State agency does not complete and submit
to the project owner a comparability study
not later than 60 days before the anniver-
sary date of the assistance contract under
this section, the automatic annual adjust-
ment factor shall be applied. The Secretary
may not reduce the contract rents in effect
on or after April 15, 1987, for newly con-
structed, substantially rehabilitated, or
moderately rehabilitated projects assisted
under this section (including projects as-
sisted under this section as in effect prior
to November 30, 1983), unless the project
has been refinanced in a manner that re-
duces the periodic payments of the owner.
Any maximum monthly rent that has been
reduced by the Secretary after April 14,
1987, and prior to November 7, 1988,
shall be restored to the maximum monthly
rent in effect on April 15, 1987.
‘‘(iii) For any project which has had
its maximum monthly rents reduced after
April 14, 1987, the Secretary shall make
assistance payments (from amounts re-
served for the original contract) to the
owner of such project in an amount equal
to the difference between the maximum
monthly rents in effect on April 15, 1987,
and the reduced maximum monthly rents,
multiplied by the number of months that
the reduced maximum monthly rents were
in effect.
‘‘(e) FAIR MARKET RENTALS.—
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish fair market rentals under this subsection peri-
odically, but not less than annually, for existing
rental dwelling units suitable for occupancy by low-
income families assisted under this section. The Sec-
retary shall establish the fair market rental by mar-
ket area for various sizes and types of dwelling
units.
‘‘(2) EFFECTIVENESS AND ADJUSTMENT.—The
Secretary shall publish proposed fair market rentals
for each area in the Federal Register with reason-
able time for public comment, and such fair market
rentals shall become effective upon the date of publi-
cation in final form in the Federal Register. Each
fair market rental in effect under this subsection
shall be adjusted to be effective on October 1 of each
year to reflect changes, based on the most recent
available data trended so the rentals will be current
for the year to which they apply, of rents for exist-
ing rental dwelling units, as the case may be, of var-
ious sizes and types in the market area suitable for
occupancy by families assisted under this section.
‘‘(3) CERTAIN AREAS.—The Secretary shall es-
tablish separate fair market rentals under this sub-
section for Westchester County in the State of New
York. The Secretary shall also establish separate fair
market rentals under this paragraph for Monroe
County in the Commonwealth of Pennsylvania. In
establishing fair market rentals for the remaining
portion of the market areas in which Monroe County
is located, the Secretary shall establish the fair mar-
ket rentals as if such portion included Monroe
County.
‘‘(f) AMOUNT
OF
MONTHLY
ASSISTANCE
PAY-
MENT.—
‘‘(1) IN GENERAL.—The amount of the monthly
assistance payment under this section with respect
to any dwelling unit shall be the difference between
the maximum monthly rent that the contract pro-
vides that the owner is to receive for the unit and
the rent the family is required to pay under section
3(a).
‘‘(2) INCREASES IN ASSISTANCE PAYMENTS.—
The Secretary shall take any action necessary, in-
cluding making contracts for assistance payments in
amounts exceeding the amounts required upon the
initial renting of dwelling units, reserving annual
contributions authority for the purpose of amending
assistance contracts, or allocating a portion of new
authorizations for the purpose of amending assist-
ance contracts, to ensure that assistance payments
are increased on a timely basis to cover increases in
maximum monthly rents or decreases in family in-
comes.
‘‘(3) REVIEWS OF FAMILY INCOMES.—
‘‘(A) IN GENERAL.—Reviews of family in-
comes for purposes of this section shall be made
annually and shall be subject to the provisions
of section 904(e) of the Stewart B. McKinney
Homeless Assistance Amendments Act of 1988.
Any other reviews of family incomes under this
paragraph may be used only for the purpose of
ensuring that a family does not pay as rent for
a dwelling unit assisted under this section more
than the amount required under section 3(a).
‘‘(B) PROCEDURES.—The Secretary shall
establish procedures that are appropriate and
necessary to ensure that income data provided
to public housing agencies and owners by fami-
lies applying for or receiving assistance under
this section is complete and accurate. In estab-
lishing such procedures, the Secretary shall an-
nually select a random sample of families to au-
thorize the Secretary to obtain information on
the families for the purpose of income verifica-
tion, or to allow the families to provide such in-
formation themselves. Such information may in-
clude data concerning unemployment compensa-
tion and Federal income taxation and data re-
lating to benefits made available under the So-
cial Security Act, the Food Stamp Act of 1977,
or title 38, United States Code.
‘‘(C) CONFIDENTIALITY.—Any income in-
formation received pursuant to this paragraph
shall remain confidential and shall be used only
for the purpose of verifying incomes in order to
determine eligibility of families for benefits (and
the amount of such benefits, if any) under this
section.
‘‘(g) ELIGIBILITY
OF UNITS
FOR ASSISTANCE.—
Each assistance contract shall provide that assistance pay-
ments may be made only with respect to the following
dwelling units:
‘‘(1) OCCUPIED UNITS.—A dwelling unit under
lease for occupancy by a family determined to be a
low-income family at the time it initially occupies the
dwelling unit or by a family that qualifies to receive
assistance under this section pursuant to section 223
or 226 of the Low-Income Housing Preservation and
Resident Homeownership Act of 1990.
‘‘(2) 
UNOCCUPIED
UNITS.—An 
unoccupied
dwelling unit, but only if—
‘‘(A)(i) a family vacates the dwelling unit
before the expiration date of the lease for occu-
pancy, or (ii) a good faith effort is being made
to fill the unoccupied unit; and
‘‘(B) the costs of such vacancy are not
charged to or paid by the family vacating the
dwelling unit.
Payments for units referred to in this paragraph
may be made only for a period not exceeding 60
days, except that such payments may be made, in
the case of a newly constructed or substantially re-
habilitated project, after the expiration of such 60-
day period in an amount equal to the debt service
attributable to such an unoccupied dwelling unit for
a period not to exceed one year, if a good faith effort
is being made to fill the unit and the unit provides
decent, safe, and sanitary housing. No such payment
may be made after the expiration of such 60-day pe-
riod if the Secretary determines that the dwelling
unit is in a project which provides the owner with
revenues exceeding the costs incurred by such owner
with respect to such project.
‘‘(h) OTHER
PROVISIONS
OF
ASSISTANCE
CON-
TRACTS.—Contracts to make assistance payments entered
into by any public housing agency (or by the Secretary)
with an owner of existing housing units shall meet the
following requirements:
‘‘(1) CONTRACT TERM.—Each assistance con-
tract shall have a term of not less than one month
nor more than 180 months. The Secretary shall per-
mit public housing agencies to enter into assistance
contracts having terms of less than 12 months to the
extent necessary to avoid disruption in assistance to
eligible families if the annual contributions contract
for the agency under subsection (b) will expire with-
in 1 year.
‘‘(2) PREFERENCES.—Each assistance contract
shall provide that, in making assistance available
pursuant to the contract—
‘‘(A) for not less than 70 percent of the
families who initially receive project-based as-
sistance, and
‘‘(B) for not less than 90 percent of the
families who initially receive tenant-based as-
sistance in any 1-year period,
preference shall be given to families that (i) occupy
substandard housing (including families that are
homeless or living in a shelter for homeless families),
(ii) are paying more than 50 percent of family in-
come for rent, (iii) are involuntarily displaced (in-
cluding displacement because of disposition of a mul-
tifamily housing project under section 203 of the
Housing and Community Development Amendments
of 1978) at the time they are seeking assistance
under this section, or (iv) are residing in public
housing.
‘‘(3) SECONDARY PREFERENCES.—Each assist-
ance contract shall provide that, for any assistance
remaining in any 1-year period after assistance is
made available pursuant to paragraph (2), pref-
erence for such assistance shall be given to families
who qualify under a system of local preferences es-
tablished by the public housing agency in writing
and after public hearing to respond to local housing
needs and priorities, which may include—
‘‘(A) assisting very low-income families
who either reside in transitional housing as-
sisted under title IV of the Stewart B. McKin-
ney Homeless Assistance Act or participate in
a program designed to provide public assistance
recipients with greater access to employment
and educational opportunities;
‘‘(B) assisting families in accordance with
subsection (q)(1)(B);
‘‘(C) assisting families identified by local
public agencies involved in providing for the
welfare of children as having a lack of adequate
housing that is a primary factor in the immi-
nent placement of a child in foster care, or in
preventing the discharge of a child from foster
care and reunification with his or her family;
‘‘(D) assisting youth, upon discharge from
foster care, in cases in which return to the fam-
ily or extended family or adoption is not avail-
able;
‘‘(E) assisting veterans who are eligible
and have applied for assistance, will use the as-
sistance for a dwelling unit designed for the
handicapped, and, upon discharge or eligibility
for discharge from a hospital or nursing home,
have physical disability which, because of the
configuration of their homes, prevents them
from access to or use of their homes; and
‘‘(F) achieving other objectives of national
housing policy as established by law.
‘‘(4) TENANT
SELECTION.—Each assistance
contract shall provide that the selection of tenants
for such dwelling units shall be the function of the
owner, subject to any provisions of the annual con-
tributions contract between the Secretary and the
agency. The owner shall use tenant selection criteria,
which shall provide as follows:
‘‘(A) PROHIBITION OF PERSONS ENGAGED
IN DRUG ACTIVITY.—The criteria shall prohibit
any individual or family evicted from housing
assisted under this Act by reason of drug-relat-
ed criminal activity from having a preference
under any provision of this paragraph for 3
years unless the evicted tenant successfully
completes a rehabilitation program approved by
the agency or owner. The agency or the owner
may waive the application of the preceding sen-
tence under standards established by the Sec-
retary, which shall provide for such waiver for
any member of a family of an individual prohib-
ited from tenancy under this subparagraph who
the agency or owner determines clearly did not
participate in and had no knowledge of such
criminal activity or when circumstances leading
to eviction no longer exist.
‘‘(B) 
OTHER
REQUIREMENTS
FOR
PROJECT-BASED
ASSISTANCE.—With 
respect
only to project-based assistance, the criteria
shall—
‘‘(i) be consistent with the purpose of
improving housing opportunities for very
low-income families;
‘‘(ii) be reasonably related to program
eligibility and an applicant’s ability to per-
form the obligations of the assisted lease;
‘‘(iii) be established in writing; and
‘‘(iv) provide for the owner to prompt-
ly provide to any rejected applicant (I)
written notice of the grounds for the rejec-
tion, and (II) an opportunity to meet with
the decision maker to evaluate the validity
of the reasons for rejection and rectify any
erroneous decisions.
‘‘(5) LEASE PROVISIONS.—Each assistance con-
tract shall provide that the lease between the tenant
of any unit and the owner shall be for at least one
year or the term of such assistance contract, which-
ever is shorter, and that the lease shall contain other
terms and conditions specified by the Secretary, in-
cluding provisions meeting the requirements of para-
graphs (6), (7), and (8).
‘‘(6) GENERAL GROUNDS FOR TERMINATION OF
TENANCY.—Each assistance contract shall provide
that the owner shall not terminate the tenancy of
the tenant of any unit except for serious or repeated
violation of the terms and conditions of the lease, for
violation of applicable Federal, State, or local law, or
for other good cause.
‘‘(7) TERMINATION FOR CRIMINAL ACTIVITY.—
Each assistance contract shall provide that any
criminal activity that threatens the health, safety, or
right to peaceful enjoyment of the premises by other
tenants, any criminal activity that threatens the
health, safety, or right to peaceful enjoyment of
their residences by persons residing in the immediate
vicinity of the premises, or any drug-related criminal
activity on or near such premises, engaged in by a
tenant of any unit, any member of the tenant’s
household, or any guest or other person under the
tenant’s control, shall be cause for termination of
tenancy.
‘‘(8) NOTICE OF TERMINATION OF TENANCY.—
Each assistance contract shall provide that before
terminating the tenancy of any tenant, the owner
shall provide written notice to the tenant specifying
the legal and factual grounds for such action. Such
notice shall be provided to the tenant not less than
30 days before termination, except that in cases of
termination for nonpayment of rent such notice shall
be provided not less than 14 days before termi-
nation.
‘‘(9) MAINTENANCE
AND
REPLACEMENT.—
Each assistance contract shall provide that mainte-
nance and replacement (including redecoration) shall
be performed in accordance with the standard prac-
tice for the building concerned as established by the
owner and agreed to by the agency (or the Sec-
retary). With the approval of the Secretary, the pub-
lic housing agency administering a contract under
this section with respect to existing housing units
may exercise all management and maintenance re-
sponsibilities with respect to the units pursuant to a
contract between such agency and the owner of such
units. Each assistance contract shall also provide
that, if the agency (or the Secretary) determines
that a unit assisted under this section fails to com-
ply in any material respect with standards for hous-
ing quality for units so assisted, the agency (or the
Secretary) may withhold some or all of the assist-
ance amounts under this section with respect to such
unit and promptly—
‘‘(A) use such amounts to make necessary
repairs or contract to have such repairs made;
‘‘(B) release any withheld amounts to the
owner after repairs are made by the owner, in
an amount not exceeding the cost of the re-
pairs;
‘‘(C) release any withheld amounts to the
applicable State or local housing agency after
repairs are made by such agency, in an amount
not exceeding the cost of the repairs; or
‘‘(D) upon the request of the tenant, re-
lease any withheld amounts to—
‘‘(i) the tenant to reimburse the ten-
ant for the reasonable cost of any nec-
essary repairs performed or paid for by the
tenant; or
‘‘(ii) such person secured by the ten-
ant and approved by the agency (or the
Secretary) to make such necessary repairs.
If an agency (or the Secretary) withholds any assist-
ance amounts pursuant to the preceding sentence,
the agency (or the Secretary) may not terminate the
assistance contract unless and until the tenant has
relocated to decent, safe, and sanitary housing.
‘‘(10) STANDARDS AND OBLIGATIONS OF RESI-
DENCY IN HOUSING RECEIVING PROJECT-BASED AS-
SISTANCE.—Each assistance contract for project-
based assistance under subsection (i) shall provide
that the owner shall ensure and maintain compliance
with subtitle C of title VI of the Housing and Com-
munity Development Act of 1992 and any regula-
tions issued under such subtitle.
‘‘(11) OTHER.—Each assistance contract shall
provide that the agency and the owner shall carry
out such other appropriate terms and conditions as
may be mutually agreed to by the agency and owner.
‘‘(i) PROJECT-BASED ASSISTANCE.—
‘‘(1) AUTHORITY.—Pursuant to an annual con-
tributions contract entered into under subsection
(b), a public housing agency may enter into a assist-
ance contract providing for assistance payments
under this section that are attached to a structure.
‘‘(2) REQUIREMENTS.—Any public housing
agency may approve project-based assistance under
this subsection with respect to any or all of the as-
sistance provided by the public housing agency if—
‘‘(A) the owner agrees to rehabilitate the
structure other than with assistance under this
Act and the owner otherwise complies with the
requirements of this section; and
‘‘(B) in the case of any newly constructed
structure, the owner or prospective owner
agrees to construct the structure other than
with assistance under this Act and otherwise
complies with the requirements of this section.
‘‘(3) LONG-TERM AFFORDABILITY.—
‘‘(A) IN GENERAL.—In the case of an as-
sistance contract for project-based assistance
under this subsection, a public housing agency
shall enter into a contract with an owner, con-
tingent upon the future availability of appro-
priations for the purpose of renewing expiring
contracts for assistance payments as provided
in appropriations Acts, to extend the term of
the underlying assistance contract for such pe-
riod or periods as the Secretary determines to
be appropriate to achieve long-term afford-
ability of the housing. The contract shall obli-
gate the owner to have the extensions of the as-
sistance contract accepted by the owner and the
owner’s successors in interest.
‘‘(B) TERM OF ASSISTANCE FOR LOW-IN-
COME HOUSING PRESERVATION.—The contract
for assistance may, at the option of the public
housing agency, have an initial term not exceed-
ing 15 years for any assistance that is at-
tached—
‘‘(i) to projects assisted under a State
program that permits the owner of the
projects to prepay a State assisted or sub-
sidized mortgage on the structure; and
‘‘(ii) for the purpose of providing in-
centives to owners to preserve such
projects for occupancy by low- and mod-
erate-income families (for the period that
assistance under this subparagraph is
available) and assisting low-income tenants
to afford any increases in rent that may be
required to induce the owner to maintain
occupancy in the project by low- and mod-
erate-income tenants.
Any assistance provided to low-income tenants
in the manner described in this subparagraph
shall not be considered for purposes of the limi-
tation under subsection (h)(2) regarding the
percentage of families that may receive assist-
ance under this section who do not qualify for
preferences under such subsection.
‘‘(4) SERVICE COORDINATORS.—In determining
the amount of assistance provided under an assist-
ance contract for project-based assistance under this
paragraph or a contract for assistance for housing
constructed or substantially rehabilitated pursuant
to assistance provided under section 8(b)(2) of this
Act (as such section existed before October 1, 1983),
the Secretary may, to the extent amounts are pro-
vided under section 5(c), increase the amount annu-
ally provided with respect to such project to provide
for the costs of employing or otherwise retaining the
services of one or more service coordinators under
section 671 of the Housing and Community Devel-
opment Act of 1992 to coordinate the provision of
any services within the project for residents of the
project who are elderly or disabled families.
‘‘(j) TERMINATION OF ASSISTANCE CONTRACTS.—
‘‘(1) NOTICE BY OWNER.—Any owner terminat-
ing any assistance contract shall provide written no-
tice to the Secretary and the tenants involved of the
proposed termination not less than one year before
the termination of the contract (but not less than 90
days in the case of tenant-based assistance). The no-
tice shall specify the date of the termination and the
reasons for the termination, with detail sufficient to
enable the Secretary to evaluate whether the termi-
nation is lawful and whether additional actions can
be taken by the Secretary to avoid the termination.
The notice shall include a statement that the owner
and the Secretary may agree to a renewal of the
contract, thus avoiding the termination.
‘‘(2) REVIEW OF NOTICE BY SECRETARY.—The
Secretary shall review the notice, shall consider
whether additional actions can be taken by the Sec-
retary to avoid the termination, and shall ensure a
proper adjustment of the contract rents for the
project in compliance with the requirements of sub-
section (d) and paragraph (3) of this subsection.
The Secretary shall issue a written finding of the le-
gality of the termination and the reasons for the ter-
mination, including the actions considered or taken
to avoid the termination. Within 30 days after issu-
ance of the findings, the owner shall provide written
notice to each tenant of the decision, together with
the written findings of the Secretary regarding the
termination. In the case of project-based assistance,
the Secretary and the owner shall complete the ac-
tions under this paragraph not later than the expira-
tion of the 9-month period beginning upon the date
that the owner provides written notice of termination
under paragraph (1).
‘‘(3) ADJUSTMENT OF CONTRACT RENT.—If an
owner provides notice of proposed termination under
paragraph (1) and the contract rent is less than the
maximum monthly rent for units assisted under this
section, the Secretary shall adjust the contract rent
based on the maximum monthly rent for units as-
sisted under this section and the value of the low-
income housing.
‘‘(4) NOTICE OF RENT INCREASES.—Each as-
sistance contract for project-based assistance under
this section shall require the owner to notify tenants
at least 90 days before the expiration of the contract
of any rent increase which may occur as a result of
the expiration of such contract.
‘‘(5) DEFINITION OF TERMINATION.—For pur-
poses of this subsection, the term ‘termination’
means the expiration of the assistance contract or
the refusal of the owner to renew an assistance con-
tract, which shall include the termination of tenancy
by an owner for business reasons.
‘‘(k) RENTAL ASSISTANCE
FOR MANUFACTURED
HOUSING.—
‘‘(1) IN GENERAL.—The Secretary may enter
into contracts to make assistance payments under
this subsection to assist low-income families by mak-
ing rental assistance payments on behalf of any such
family that utilizes a manufactured home as its prin-
cipal place of residence. In carrying out this sub-
section, the Secretary may—
‘‘(A) enter into annual contributions con-
tracts with public housing agencies pursuant to
which such agencies may enter into assistance
contracts to make such assistance payments to
the owners of such real property; or
‘‘(B) enter into such contracts directly
with the owners of such real property.
‘‘(2) USE OF ASSISTANCE.—Rental assistance
payments under this subsection may be made with
respect to the rental of the real property on which
is located a manufactured home that is owned by a
low-income family or with respect to the rental by
such a family of a manufactured home and the real
property on which it is located.
‘‘(3) ASSISTANCE FOR RENTAL OF MANUFAC-
TURED HOME SITE.—
‘‘(A) MAXIMUM MONTHLY RENT.—A con-
tract entered into pursuant to this paragraph
shall establish the maximum monthly rent (in-
cluding maintenance and management charges)
that the owner is entitled to receive for the
space on which a manufactured home is located
and with respect to which assistance payments
are to be made. The maximum monthly rent
shall not exceed by more than 10 percent the
fair market rental established by the Secretary
periodically (but not less than annually) with
respect to the market area for the rental of real
property suitable for occupancy by families as-
sisted under this paragraph.
‘‘(B) AMOUNT OF MONTHLY ASSISTANCE
PAYMENT.—The amount of any monthly assist-
ance payment with respect to any family that
rents real property that is assisted under this
paragraph, and on which is located a manufac-
tured home that is owned by such family shall
be the difference between the rent the family is
required to pay under section 3(a) and the sum
of—
‘‘(i) the monthly payment made by
such family to amortize the cost of pur-
chasing the manufactured home;
‘‘(ii) the monthly utility payments
made by such family, subject to reasonable
limitations prescribed by the Secretary;
and
‘‘(iii) the maximum monthly rent per-
mitted with respect to the real property
which is rented by such family for the pur-
pose of locating its manufactured home;
except that in no case may such assistance ex-
ceed the total amount of such maximum month-
ly rent.
‘‘(4) ASSISTANCE FOR RENTAL OF MANUFAC-
TURED HOME AND SITE.—
‘‘(A) MAXIMUM
MONTHLY
RENT.—Con-
tracts entered into pursuant to this paragraph
shall establish the maximum monthly rent per-
mitted with respect to the manufactured home
and the real property on which it is located and
with respect to which assistance payments are
to be made. The maximum monthly rent shall
not exceed by more than 10 percent the fair
market rental established by the Secretary peri-
odically (but not less than annually) with re-
spect to the market area for the rental of a
manufactured home and the real property on
which it is located suitable for occupancy by
families assisted under this paragraph; except
that the maximum monthly rent may exceed the
fair market rental by more than 10 but not
more than 20 percent if the Secretary deter-
mines that special circumstances warrant such
higher maximum rent.
‘‘(B) AMOUNT OF MONTHLY ASSISTANCE
PAYMENT.—The amount of any monthly assist-
ance payment with respect to any family that
rents a manufactured home and the real prop-
erty on which it is located and that is assisted
under this paragraph shall be the difference be-
tween the rent the family is required to pay
under section 3(a) and the sum of—
‘‘(i) the monthly utility payments
made by such family, subject to reasonable
limitations prescribed by the Secretary;
and
‘‘(ii) the maximum monthly rent per-
mitted with respect to the manufactured
home and real property on which it is lo-
cated.
‘‘(5) ADJUSTMENT
OF
MAXIMUM
MONTHLY
RENTS.—The provisions of paragraphs (3) through
(7) of subsection (d) shall apply to the adjustments
of maximum monthly rents under this subsection.
‘‘(6) CONTRACT TERM.—Each contract entered
into under the subsection shall be for a term of not
less than one month and not more than 180 months;
except that in any case in which the manufactured
home park is substantially rehabilitated or newly
constructed, such term may not be less than 240
months, nor more than the maximum term for a
manufactured home loan permitted under section
2(b) of the National Housing Act.
‘‘(7) APPLICABILITY.—The Secretary may carry
out this subsection without regard to whether the
manufactured home park is existing, substantially
rehabilitated, or newly constructed.
‘‘(8) LIMITATION
ON
SUBSTANTIALLY
REHA-
BILITATED
AND
NEWLY
CONSTRUCTED
MANUFAC-
TURED HOME PARKS.—In the case of any substan-
tially rehabilitated or newly constructed manufac-
tured home park containing spaces with respect to
which assistance is made under this subsection, the
principal amount of the mortgage attributable to the
rental spaces within the park may not exceed an
amount established by the Secretary which is equal
to or less than the limitation for manufactured home
parks described in section 207(c)(3) of the National
Housing Act, and the Secretary may increase such
limitation in high cost areas in the manner described
in such section.
‘‘(9) OTHER
REQUIREMENTS.—The Secretary
may prescribe other terms and conditions necessary
for the purpose of carrying out this subsection and
that are consistent with the purposes of this sub-
section.
‘‘(l) SINGLE ROOM OCCUPANCY FACILITIES.—
‘‘(1) AUTHORITY.—In making assistance avail-
able under this section and assistance under section
441 and part V of subtitle F of title IV of the Stew-
art B. McKinney Homeless Assistance Act, the Sec-
retary may provide assistance with respect to resi-
dential properties in which some or all of the dwell-
ing units do not contain bathroom or kitchen facili-
ties, if—
‘‘(A) the property is located in an area in
which there is a significant demand for such
units, as determined by the Secretary;
‘‘(B) the unit of general local government
in which the property is located and the local
public housing agency approve of such units
being utilized for such purpose; and
‘‘(C) the unit of general local government
in which the property is located and the local
public housing agency certify to the Secretary
that the property complies with local health and
safety standards.
‘‘(2) WAIVER OF LIMITATIONS ON ASSISTANCE
FOR SINGLE PERSONS.—The Secretary may waive,
in appropriate cases, the limitation and preference in
section 3(b)(3)(A) with respect to the assistance
made available under this subsection.
‘‘(m) HOUSING FOR ELDERLY AND DISABLED FAMI-
LIES.—
‘‘(1) SHARED HOUSING.—To assist elderly fam-
ilies and disabled families (as defined in section
3(b)) who elect to live in a shared housing arrange-
ment in which they benefit as a result of sharing the
facilities of a dwelling with others in a manner that
effectively and efficiently meets their housing needs
and thereby reduces their costs of housing, the Sec-
retary shall permit assistance provided under this
section to be used by such families in such arrange-
ments. In carrying out this subsection, the Secretary
shall issue minimum habitability standards for the
purpose of ensuring decent, safe, and sanitary hous-
ing for such families while taking into account the
special circumstances of shared housing.
‘‘(2) PRIORITY
FOR
NONELDERLY
DISABLED
FAMILIES.—In allocating assistance under this sec-
tion, a public housing agency that serves more than
one unit of general local government may, at the dis-
cretion of the agency, give priority to disabled fami-
lies that are not elderly families.
‘‘(3) AUTHORITY
TO
PROVIDE
PREFERENCES
FOR THE ELDERLY AND RESERVE UNITS FOR THE
DISABLED.—Notwithstanding subsection (h)(2) or
(3), an owner of a covered section 8 housing project
(as such term is defined in section 659 of the Hous-
ing and Community Development Act of 1992) may
give preference for occupancy of dwelling units in
the project, and reserve units for occupancy, in ac-
cordance with subtitle D of title VI of the Housing
and Community Development Act of 1992.
‘‘(n) ADMINISTRATIVE FEES.—
‘‘(1) BASIC FEE FOR TENANT-BASED RENTAL
PROGRAM.—The Secretary shall establish a fee for
the costs incurred by a public housing agency in ad-
ministering the program for rental assistance under
this section, which shall be, together with other fees
authorized under this subsection, included in any
amounts provided to the public housing agency
under the annual contributions contract for the
agency. The amount of the fee for each month for
which a dwelling unit is covered by an assistance
contract shall be 8.2 percent of the fair market rent-
al established under subsection (e) for a 2-bedroom
existing rental dwelling unit in the market area of
the public housing agency. The Secretary may in-
crease the fee if necessary to reflect the higher costs
of administering small programs and programs oper-
ating over large geographic areas.
‘‘(2) OTHER FEES.—The Secretary shall also
establish reasonable fees (as determined by the Sec-
retary) for—
‘‘(A) the costs of preliminary expenses that
a public housing agency documents it has in-
curred in connection with new allocations of as-
sistance under the program for rental assist-
ance under this section, which shall not exceed
$275 per unit assisted;
‘‘(B) the costs incurred in assisting fami-
lies who experience difficulty (as determined by
the Secretary) in obtaining appropriate housing
under the program;
‘‘(C) the costs incurred in administering
the provision of rental assistance under this
section through the self-sufficiency program
under section 23; and
‘‘(D) extraordinary costs approved by the
Secretary.
‘‘(3) AUTHORITY TO INCLUDE COSTS OF SERV-
ICE COORDINATORS IN FEES.—
‘‘(A) IN GENERAL.—Fees under this sub-
section may be used for the costs of employing
or otherwise retaining the services of one or
more service coordinators under section 671 of
the Housing and Community Development Act
of 1992 to coordinate the provision of support-
ive services for elderly families and disabled
families on whose behalf tenant-based assist-
ance is provided under this section or section
811(b)(1). Such service coordinators shall have
the same responsibilities with respect to such
families as service coordinators of covered fed-
erally assisted housing projects have under sec-
tion 671 of such Act with respect to residents
of such projects.
‘‘(B) 
REQUIREMENT.—To 
the 
extent
amounts are provided in appropriation Acts
under section 5(c) for use under this para-
graph, the Secretary shall increase fees under
this subsection to provide for the costs of such
service coordinators for public housing agencies.
‘‘(4) BUDGET
COMPLIANCE.—The Secretary
may establish or increase a fee in accordance with
this subsection only to such extent or in such
amounts as are provided in appropriation Acts.
‘‘(5) FEES FOR 1995 AND 1996.—Notwithstand-
ing any other provision of this subsection, the fee for
the costs incurred by a public housing agency in ad-
ministering the program for rental assistance under
this section during fiscal years 1995 and 1996 shall
be equal to the fee determined for fiscal year 1994
under section 11(a) of the HUD Demonstration Act
of 1993.
‘‘(o) PORTABILITY OF ASSISTANCE.—
‘‘(1) AUTHORITY.—Except as provided in para-
graph (3), any family on behalf of whom is provided
tenant-based rental assistance under this section and
who moves to an eligible dwelling unit located within
the same State, or the same or a contiguous metro-
politan statistical area, as the metropolitan statis-
tical area within which is located the area of juris-
diction of the public housing agency approving the
‘‘(7) PROJECT-BASED ASSISTANCE.—The term
‘project-based assistance’ means rental assistance
under this section that is attached to a structure
pursuant to subsection (i).
‘‘(8) RENT.—The terms ‘rent’ and ‘rental’ in-
clude, with respect to members of a cooperative, the
charges under the occupancy agreements between
such members and the cooperative.
‘‘(9) RENTAL ASSISTANCE.—The term ‘rental
assistance’ means assistance provided under this sec-
tion on behalf of low-income families for the rental
of a dwelling unit.
‘‘(10) TENANT-BASED ASSISTANCE.—The term
‘tenant-based assistance’ means rental assistance
under this section that is not project-based assist-
ance.’’.
(b) TRANSITION.—
(1) APPLICABILITY.—The amendment made by
subsection (a) shall apply only to assistance under
section 8 of the United States Housing Act of 1937
provided pursuant to an assistance contract entered
into or renewed during fiscal year 1995 or there-
after. Any such assistance provided pursuant to an
assistance contract entered into before the com-
mencement of fiscal year 1995 shall be subject to