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(i) INAPPLICABILITY
OF
DISPOSITION
REQUIRE-
MENTS.—The provisions of section 261 shall not apply to
disposition of public housing dwelling units under a home-
ownership program under this section, except that any
dwelling units sold under such a program shall be treated
as public housing dwelling units for purposes of subsections
(e) and (f) of section 261.
Subtitle E—Disposition, Demolition,
and Revitalization of Developments
SEC. 261. REQUIREMENTS FOR DEMOLITION AND DISPOSI-
TION OF DEVELOPMENTS.
(a) AUTHORITY AND FLEXIBILITY.—A public housing
agency may demolish, dispose of, or demolish and dispose
of nonviable or nonmarketable public housing developments
of the agency in accordance with this section.
(b) LOCAL HOUSING MANAGEMENT PLAN REQUIRE-
MENT.—A public housing agency may take any action to
demolish or dispose of a public housing development (or a
portion of a development) only if such demolition or dis-
position complies with the provisions of this section and
is in accordance with the local housing management plan
for the agency. Notwithstanding section 107, the Secretary
may approve a local housing management plan without ap-
proving the portion of the plan covering demolition or dis-
position pursuant to this section.
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(c) PURPOSE OF DEMOLITION OR DISPOSITION.—A
public housing agency may demolish or dispose of a public
housing development (or portion of a development) only if
the agency provides sufficient evidence to the Secretary
that—
(1) the development (or portion thereof) is se-
verely distressed or obsolete;
(2) the development (or portion thereof) is in a
location making it unsuitable for housing purposes;
(3) the development (or portion thereof) has de-
sign or construction deficiencies that make cost-effec-
tive rehabilitation infeasible;
(4) assuming that reasonable rehabilitation and
management intervention for the development has
been completed and paid for, the anticipated revenue
that would be derived from charging market-based
rents for units in the development (or portion thereof)
would not cover the anticipated operating costs and
replacement reserves of the development (or portion)
at full occupancy and the development (or portion)
would constitute a substantial burden on the resources
of the public housing agency;
(5) retention of the development (or portion
thereof) is not in the best interests of the residents of
the public housing agency because—
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(A) developmental changes in the area sur-
rounding the development adversely affect the
health or safety of the residents or the feasible
operation of the development by the public hous-
ing agency;
(B) demolition or disposition will allow the
acquisition, development, or rehabilitation of
other properties which will be more efficiently or
effectively operated as low-income housing; or
(C) other factors exist that the agency deter-
mines are consistent with the best interests of the
residents and the agency and not inconsistent
with other provisions of this Act;
(6) in the case only of demolition or disposition
of a portion of a development, the demolition or dis-
position will help to ensure the remaining useful life
of the remainder of the development; or
(7) in the case only of property other than dwell-
ing units—
(A) the property is excess to the needs of a
development; or
(B) the demolition or disposition is inciden-
tal to, or does not interfere with, continued oper-
ation of a development.
147
The evidence required under this subsection shall include,
as a condition of demolishing or disposing of a public hous-
ing development (or portion of a development) estimated to
have a value of $100,000 or more, a statement of the market
value of the development (or portion), which has been deter-
mined by a party not having any interest in the housing
or the public housing agency and pursuant to not less than
2 professional, independent appraisals of the development
(or portion).
(d) CONSULTATION.—A public housing agency may
demolish or dispose of a public housing development (or
portion of a development) only if the agency notifies and
confers regarding the demolition or disposition with—
(1) the residents of the development (or portion);
and
(2) appropriate local government officials.
(e) COUNSELING.—A public housing agency may de-
molish or dispose of a public housing development (or a
portion of a development) only if the agency provides any
necessary counseling for families displaced by such action
to facilitate relocation.
(f) USE OF PROCEEDS.—Any net proceeds from the
disposition of a public housing development (or portion of
a development) shall be used for—
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(1) housing assistance for low-income families
that is consistent with the low-income housing needs
of the community, through acquisition, development,
or rehabilitation of, or homeownership programs for,
other low-income housing or the provision of choice-
based assistance under title III for such families;
(2) supportive services relating to job training or
child care for residents of a development or develop-
ments; or
(3) leveraging amounts for securing commercial
enterprises, on-site in public housing developments of
the public housing agency, appropriate to serve the
needs of the residents.
(g) RELOCATION.—A public housing agency that de-
molishes or disposes of a public housing development (or
portion of a development thereof) shall ensure that—
(1) each family that is a resident of the develop-
ment (or portion) that is demolished or disposed of is
relocated to other safe, clean, healthy, and affordable
housing, which is, to the maximum extent practicable,
housing of the family’s choice, including choice-based
assistance under title III (provided that with respect
to choice-based assistance, the preceding requirement
shall be fulfilled only upon the relocation of the such
family into such housing);
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(2) the public housing agency does not take any
action to dispose of any unit until any resident to be
displaced is relocated in accordance with paragraph
(1); and
(3) each resident family to be displaced is paid
relocation expenses, and the rent to be paid initially
by the resident following relocation does not exceed the
amount permitted under section 225(a).
(h) RIGHT OF FIRST REFUSAL FOR RESIDENT ORGA-
NIZATIONS
AND
RESIDENT
MANAGEMENT
CORPORA-
TIONS.—
(1) IN GENERAL.—A public housing agency may
not dispose of a public housing development (or por-
tion of a development) unless the agency has, before
such disposition, offered to sell the property, as pro-
vided in this subsection, to each resident organization
and resident management corporation operating at
the development for continued use as low-income
housing, and no such organization or corporation
purchases the property pursuant to such offer. A resi-
dent organization may act, for purposes of this sub-
section, through an entity formed to facilitate home-
ownership under subtitle D.
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(2) TIMING.—Disposition of a development (or
portion thereof) under this section may not take
place—
(A) before the expiration of the period dur-
ing which any such organization or corporation
may notify the agency of interest in purchasing
the property, which shall be the 30-day period
beginning on the date that the agency first pro-
vides notice of the proposed disposition of the
property to such resident organizations and resi-
dent management corporations;
(B) if an organization or corporation sub-
mits notice of interest in accordance with sub-
paragraph (A), before the expiration of the pe-
riod during which such organization or corpora-
tion may obtain a commitment for financing to
purchase the property, which shall be the 60-day
period beginning upon the submission to the
agency of the notice of interest; or
(C) if, during the period under subpara-
graph (B), an organization or corporation ob-
tains such financing commitment and makes a
bona fide offer to the agency to purchase the
property for a price equal to or exceeding the ap-
plicable offer price under paragraph (3).
151
The agency shall sell the property pursuant to any
purchase offer described in subparagraph (C).
(3) TERMS OF OFFER.—An offer by a public
housing agency to sell a property in accordance with
this subsection shall involve a purchase price that re-
flects the market value of the property, the reason for
the sale, the impact of the sale on the surrounding
community, and any other factors that the agency
considers appropriate.
(i) INFORMATION FOR LOCAL HOUSING MANAGEMENT
PLAN.—A public housing agency may demolish or dispose
of a public housing development (or portion thereof) only
if it includes in the applicable local housing management
plan information sufficient to describe—
(1) the housing to be demolished or disposed of;
(2) the purpose of the demolition or disposition
under subsection (c) and why the demolition or dis-
position complies with the requirements under sub-
section (c), and includes evidence of the market value
of the development (or portion) required under sub-
section (c);
(3) how the consultations required under sub-
section (d) will be made;
(4) how the net proceeds of the disposition will
be used in accordance with subsection (f);