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‘‘(ii) any grant-in-aid or scholarship 
amounts related to such attendance used— 
‘‘(I) for the cost of tuition or 
books; or 
‘‘(II) in such amounts as the Sec-
retary may allow, for the cost of room 
and board. 
‘‘(D) EDUCATIONAL SAVINGS ACCOUNTS.— 
Income shall be determined without regard to 
any amounts in or from, or any benefits from, 
any Coverdell education savings account under 
section 530 of the Internal Revenue Code of 
1986 or any qualified tuition program under 
section 529 of such Code. 
‘‘(E) 
RECORDKEEPING.—The 
Secretary 
may not require a public housing agency or 
owner to maintain records of any amounts ex-
cluded from income pursuant to this subpara-
graph. 
‘‘(5) ADJUSTED INCOME.—The term ‘adjusted 
income’ means, with respect to a family, the amount 
(as determined by the public housing agency or 
owner) of the income of the members of the family 
residing in a dwelling unit or the persons on a lease, 
after any deductions from income as follows: 
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‘‘(A) ELDERLY
AND
DISABLED
FAMI-
LIES.—$525 in the case of any family that is 
an elderly family or a disabled family. 
‘‘(B) MINORS, STUDENTS, AND PERSONS 
WITH DISABILITIES.—$480 for each member of 
the family residing in the household (other than 
the head of the household or his or her spouse) 
who is less than 18 years of age or is attending 
school or vocational training on a full-time 
basis, or who is 18 years of age or older and 
is a person with disabilities. 
‘‘(C) CHILD CARE.—Any reasonable child 
care expenses necessary to enable a member of 
the family to be employed or to further his or 
her education. 
‘‘(D) HEALTH AND MEDICAL EXPENSES.— 
The amount, if any, by which 10 percent of an-
nual family income is exceeded by the sum of— 
‘‘(i) in the case of any elderly or dis-
abled family, any unreimbursed health and 
medical care expenses; and 
‘‘(ii) any unreimbursed reasonable at-
tendant care and auxiliary apparatus ex-
penses for each handicapped member of 
the family, if determined necessary by the 
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public housing agency or owner to enable 
any member of such family to be employed. 
The Secretary shall, by regulation, provide 
hardship exemptions to the requirements of this 
subparagraph and subparagraph (C) for im-
pacted families who demonstrate an inability to 
pay calculated rents because of financial hard-
ship. Such regulations shall include a require-
ment to notify tenants regarding any changes 
to the determination of adjusted income pursu-
ant to such subparagraphs based on the deter-
mination of the family’s claim of financial hard-
ship exemptions required by the preceding sen-
tence. Such regulations shall be promulgated in 
consultation with tenant organizations, industry 
participants, and the Secretary of Health and 
Human Services, with an adequate comment 
period provided for interested parties. 
‘‘(E) PERMISSIVE DEDUCTIONS.—Such ad-
ditional deductions as a public housing agency 
may, at its discretion, establish, except that the 
Secretary shall establish procedures to ensure 
that such deductions do not materially increase 
Federal expenditures. 
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The Secretary shall annually calculate the amounts 
of the deductions under subparagraphs (A) and (B), 
as such amounts may have been previously cal-
culated, by applying an inflationary factor as the 
Secretary shall, by regulation, establish, except that 
the actual deduction determined for each year shall 
be established by rounding such amount to the next 
lowest multiple of $25.’’. 
(d) HOUSING CHOICE VOUCHER PROGRAM.—Section 
8(o) of the United States Housing Act of 1937 (42 U.S.C. 
1437f(o)) is amended— 
(1) in paragraph (1)(D), by inserting before the 
period at the end the following: ‘‘, except that a pub-
lic housing agency may establish a payment stand-
ard of not more than 120 percent of the fair market 
rent where necessary as a reasonable accommodation 
for a person with a disability, without approval of 
the Secretary. A public housing agency may use a 
payment standard that is greater than 120 percent 
of the fair market rent as a reasonable accommoda-
tion for a person with a disability, but only with the 
approval of the Secretary. In connection with the use 
of any increased payment standard established or 
approved pursuant to either of the preceding two 
sentences as a reasonable accommodation for a per-
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son with a disability, the Secretary may not estab-
lish additional requirements regarding the amount of 
adjusted income paid by such person for rent’’; and 
(2) in paragraph (5)— 
(A) in the paragraph heading, by striking 
‘‘ANNUAL REVIEW’’ and inserting ‘‘REVIEWS’’; 
(B) in subparagraph (A)— 
(i) by striking ‘‘the provisions of’’ and 
inserting ‘‘paragraphs (1), (6), and (7) of 
section 3(a) and to’’; and 
(ii) by striking ‘‘and shall be con-
ducted’’ and all that follows through the 
end of the subparagraph and inserting a 
period; and 
(C) in subparagraph (B), by striking the 
second sentence. 
(e) 
ENHANCED
VOUCHER
PROGRAM.—Section 
8(t)(1)(D) of the United States Housing Act of 1937 (42 
U.S.C. 1437f(t)(1)(D)) is amended by striking ‘‘income’’ 
each place such term appears and inserting ‘‘annual ad-
justed income’’. 
(f) PROJECT-BASED HOUSING.—Paragraph (3) of 
section 8(c) of the United States Housing Act of 1937 
(42 U.S.C. 1437f(c)(3)) is amended by striking the last 
sentence. 
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(g) IMPACT ON PUBLIC HOUSING REVENUES.— 
(1) ADJUSTMENTS TO OPERATING FORMULA.— 
If the Secretary of Housing and Urban Development 
determines that the application of subsections (a) 
through (e) of this section results in a material and 
disproportionate reduction in the rental income of 
certain public housing agencies during the first year 
in which such subsections are implemented, the Sec-
retary may make appropriate adjustments in the for-
mula income for such year of those agencies experi-
encing such a reduction. 
(2) HUD REPORTS ON REVENUE AND COST IM-
PACT.—In each of the first two years after the first 
year in which subsections (a) through (e) are imple-
mented, the Secretary of Housing and Urban Devel-
opment shall submit a report to Congress identifying 
and calculating the impact of changes made by such 
subsections and section 104 of this Act on the reve-
nues and costs of operating public housing units, the 
voucher program for rental assistance under section 
8 of the United States Housing Act of 1937, and 
the program under such section 8 for project-based 
rental assistance. If such report identifies a material 
reduction in the net income of public housing agen-
cies nationwide or a material increase in the costs of 
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funding the voucher program or the project-based 
assistance program, the Secretary shall include in 
such report recommendations for legislative changes 
to reduce or eliminate such a reduction. 
(h) EFFECTIVE DATE.—The Secretary of Housing 
and Urban Development shall issue notice or regulations 
to implement this section and this section shall take effect 
after such issuance, except that this section may only take 
effect upon the commencement of a calendar year. 
(i) STUDY ON IMPACT ON ELDERLY AND DISABLED 
FAMILIES OF DECREASED DEDUCTIONS IN INCOME.— 
(1) STUDY.—The Secretary of Housing and 
Urban Development shall conduct a study to deter-
mine the impacts, on rents paid by elderly and dis-
abled individuals and families assisted under the sec-
tion 8 rental assistance and public housing programs 
under the United States Housing Act of 1937 (42 
U.S.C. 1437 et seq.), of any decreases in the 
amounts of any deductions from income (for pur-
poses of section 3(b) of such Act (42 U.S.C. 
1437a(b))), as compared to such deductions under 
such section 3(b) as in effect before the effectiveness 
of this section, resulting from the amendments made 
by this section. 
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(2) REPORT.—The Secretary shall submit to 
the Congress a report setting forth the results of the 
study conducted pursuant to paragraph (1) not later 
than the expiration of the 12-month period begin-
ning on the date of the enactment of this Act. 
(3) EFFECTIVE
DATE.—Notwithstanding sub-
section (h) of this section, this subsection shall take 
effect on the date of the enactment of this Act. 
SEC. 103. LIMITATION ON PUBLIC HOUSING TENANCY FOR 
OVER-INCOME FAMILIES. 
Subsection (a) of section 16 of the United States 
Housing Act of 1937 (42 U.S.C. 1437n(a)) is amended 
by adding at the end the following new paragraph: 
‘‘(5) LIMITATIONS ON TENANCY FOR OVER-IN-
COME FAMILIES.— 
‘‘(A) LIMITATIONS.—Except as provided in 
subparagraph (D), in the case of any family re-
siding in a dwelling unit of public housing 
whose income for the most recent two consecu-
tive years, as determined pursuant to income 
reviews conducted pursuant to section 3(a)(6), 
has exceeded the applicable income limitation 
under subparagraph (C), the public housing 
agency shall— 
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‘‘(i) notwithstanding any other provi-
sion of this Act, charge such family as 
monthly rent for the unit occupied by such 
family an amount equal to the greater of— 
‘‘(I) the applicable fair market 
rental established under section 8(c) 
for a dwelling unit in the same mar-
ket area of the same size; or 
‘‘(II) the amount of the monthly 
subsidy provided under this Act for 
the dwelling unit, which shall include 
any amounts from the Operating 
Fund and Capital Fund under section 
9 used for the unit, as determined by 
the agency in accordance with regula-
tions that the Secretary shall issue to 
carry out this subclause; or 
‘‘(ii) terminate the tenancy of such 
family in public housing not later than 6 
months after the income determination de-
scribed in subparagraph (A). 
‘‘(B) NOTICE.—In the case of any family 
residing in a dwelling unit of public housing 
whose income for a year has exceeded the appli-
cable income limitation under subparagraph 
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(C), upon the conclusion of such year the public 
housing agency shall provide written notice to 
such family of the requirements under subpara-
graph (A). 
‘‘(C) INCOME
LIMITATION.—The income 
limitation under this subparagraph shall be 120 
percent of the median income for the area, as 
determined by the Secretary with adjustments 
for smaller and larger families, except that the 
Secretary may establish income limitations 
higher or lower than 120 percent of such me-
dian income on the basis of the Secretary’s 
findings that such variations are necessary be-
cause of prevailing levels of construction costs, 
or unusually high or low family incomes, va-
cancy rates, or rental costs. 
‘‘(D) 
EXCEPTION.—Subparagraph 
(A) 
shall not apply to a family occupying a dwelling 
unit in public housing pursuant to paragraph 
(5) of section 3(a) (42 U.S.C. 1437a(a)(5)). 
‘‘(E) REPORTS ON OVER-INCOME FAMILIES 
AND WAITING LISTS.—The Secretary shall re-
quire that each public housing agency shall— 
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‘‘(i) submit a report annually, in a 
format required by the Secretary, that 
specifies— 
‘‘(I) the number of families resid-
ing, as of the end of the year for 
which the report is submitted, in pub-
lic housing administered by the agen-
cy who had incomes exceeding the ap-
plicable income limitation under sub-
paragraph (C); and 
‘‘(II) the number of families, as 
of the end of such year, on the wait-
ing lists for admission to public hous-
ing projects of the agency; and 
‘‘(ii) make the information reported 
pursuant to clause (i) publicly available.’’. 
SEC. 104. LIMITATION ON ELIGIBILITY FOR ASSISTANCE 
BASED ON ASSETS. 
Section 16 of the United States Housing Act of 1937 
(42 U.S.C. 1437n) is amended by inserting after sub-
section (d) the following new subsection: 
‘‘(e) ELIGIBILITY FOR ASSISTANCE BASED ON AS-
SETS.— 
‘‘(1) LIMITATION ON ASSETS.—Subject to para-
graph (3) and notwithstanding any other provision 
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of this Act, a dwelling unit assisted under this Act 
may not be rented and assistance under this Act 
may not be provided, either initially or at each recer-
tification of family income, to any family— 
‘‘(A) whose net family assets exceed 
$100,000, as such amount is adjusted annually 
by applying an inflationary factor as the Sec-
retary considers appropriate; or 
‘‘(B) who has a present ownership interest 
in, a legal right to reside in, and the effective 
legal authority to sell, real property that is suit-
able for occupancy by the family as a residence, 
except that the prohibition under this subpara-
graph shall not apply to— 
‘‘(i) any property for which the family 
is receiving assistance under subsection (y) 
or (o)(12) of section 8 of this Act; 
‘‘(ii) any person that is a victim of do-
mestic violence; or 
‘‘(iii) any family that is offering such 
property for sale. 
‘‘(2) NET FAMILY ASSETS.— 
‘‘(A) IN GENERAL.—For purposes of this 
subsection, the term ‘net family assets’ means, 
for all members of the household, the net cash 
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value of all assets after deducting reasonable 
costs that would be incurred in disposing of real 
property, savings, stocks, bonds, and other 
forms of capital investment. Such term does not 
include interests in Indian trust land, equity in 
property for which the family is receiving assist-
ance under subsection (y) or (o)(12) of section 
8, equity accounts in homeownership programs 
of the Department of Housing and Urban De-
velopment, or Family Self Sufficiency accounts. 
‘‘(B) EXCLUSIONS.—Such term does not 
include— 
‘‘(i) the value of personal property, ex-
cept for items of personal property of sig-
nificant value, as the Secretary may estab-
lish or the public housing agency may de-
termine; 
‘‘(ii) the value of any retirement ac-
count; 
‘‘(iii) real property for which the fam-
ily does not have the effective legal author-
ity necessary to sell such property; 
‘‘(iv) any amounts recovered in any 
civil action or settlement based on a claim 
of malpractice, negligence, or other breach 
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of duty owed to a member of the family 
and arising out of law, that resulted in a 
member of the family being disabled; 
‘‘(v) the value of any Coverdell edu-
cation savings account under section 530 
of the Internal Revenue Code of 1986 or 
any qualified tuition program under sec-
tion 529 of such Code; and 
‘‘(vi) such other exclusions as the Sec-
retary may establish. 
‘‘(C) TRUST FUNDS.—In cases in which a 
trust fund has been established and the trust is 
not revocable by, or under the control of, any 
member of the family or household, the value of 
the trust fund shall not be considered an asset 
of a family if the fund continues to be held in 
trust. Any income distributed from the trust 
fund shall be considered income for purposes of 
section 3(b) and any calculations of annual 
family income, except in the case of medical ex-
penses for a minor. 
‘‘(3) SELF-CERTIFICATION.— 
‘‘(A) NET
FAMILY
ASSETS.—A public 
housing agency or owner may determine the net 
assets of a family, for purposes of this section, 
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based on a certification by the family that the 
net assets of such family do not exceed 
$50,000, as such amount is adjusted annually 
by applying an inflationary factor as the Sec-
retary considers appropriate. 
‘‘(B) NO CURRENT REAL PROPERTY OWN-
ERSHIP.—A public housing agency or owner 
may determine compliance with paragraph 
(1)(B) based on a certification by the family 
that such family does not have any current 
ownership interest in any real property at the 
time the agency or owner reviews the family’s 
income. 
‘‘(C) STANDARDIZED
FORMS.—The Sec-
retary may develop standardized forms for the 
certifications referred to in subparagraphs (A) 
and (B). 
‘‘(4) 
COMPLIANCE
FOR
PUBLIC
HOUSING 
DWELLING UNITS.—When recertifying family income 
with respect to families residing in public housing 
dwelling units, a public housing agency may, in the 
discretion of the agency and only pursuant to a pol-
icy that is set forth in the public housing agency 
plan under section 5A for the agency, choose not to 
enforce the limitation under paragraph (1). 
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‘‘(5) ENFORCEMENT.—When recertifying the 
income of a family residing in a dwelling unit as-
sisted under this Act, a public housing agency or 
owner may choose not to enforce the limitation 
under paragraph (1) or may establish exceptions to 
such limitation based on eligibility criteria, but only 
pursuant to a policy that is set forth in the public 
housing agency plan under section 5A for the agency 
or under a policy adopted by the owner. Eligibility 
criteria for establishing exceptions may provide for 
separate treatment based on family type and may be 
based on different factors, such as age, disability, in-
come, the ability of the family to find suitable alter-
native housing, and whether supportive services are 
being provided. 
‘‘(6) AUTHORITY TO DELAY EVICTIONS.—In the 
case of a family residing in a dwelling unit assisted 
under this Act who does not comply with the limita-
tion under paragraph (1), the public housing agency 
or project owner may delay eviction or termination 
of the family based on such noncompliance for a pe-
riod of not more than 6 months. 
‘‘(7) VERIFYING INCOME.— 
‘‘(A) Beginning in fiscal year 2018, the 
Secretary shall require public housing agencies 
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to require each applicant for, or recipient of, 
benefits under this Act to provide authorization 
by the applicant or recipient (or by any other 
person whose income or resources are material 
to the determination of the eligibility of the ap-
plicant or recipient for such benefits) for the 
public housing agency to obtain (subject to the 
cost reimbursement requirements of section 
1115(a) of the Right to Financial Privacy Act) 
from any financial institution (within the mean-
ing of section 1101(1) of such Act) any finan-
cial record (within the meaning of section 
1101(2) of such Act) held by the institution 
with respect to the applicant or recipient (or 
any such other person) whenever the public 
housing agency determines the record is needed 
in connection with a determination with respect 
to such eligibility or the amount of such bene-
fits. 
‘‘(B) Notwithstanding section 1104(a)(1) 
of the Right to Financial Privacy Act, an au-
thorization provided by an applicant or recipi-
ent (or any other person whose income or re-
sources are material to the determination of the 
eligibility of the applicant or recipient) pursuant 
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‘‘(iii) A request by the public housing 
agency pursuant to an authorization provided 
under this clause is deemed to meet the require-
ments of section 1104(a)(3) of the Right to Fi-
nancial Privacy Act and the flush language of 
section 1102 of such Act. 
‘‘(iv) The public housing agency shall in-
form any person who provides authorization 
pursuant to this paragraph of the duration and 
scope of the authorization. 
‘‘(D) If an applicant for, or recipient of, 
benefits under this Act (or any such other per-
son referred to in subparagraph (A)) refuses to 
provide, or revokes, any authorization made by 
the applicant or recipient for the public housing 
agency to obtain from any financial institution 
any financial record, the public housing agency 
may, on that basis, determine that the appli-
cant or recipient is ineligible for benefits under 
this title.’’. 
SEC. 105. UNITS OWNED BY PUBLIC HOUSING AGENCIES. 
Paragraph (11) of section 8(o) of the United States 
Housing Act of 1937 (42 U.S.C. 1437f(o)(11)) is amend-
ed— 
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(1) by striking ‘‘(11) LEASING
OF
UNITS 
OWNED BY PHA.—If’’ and inserting the following: 
‘‘(11) LEASING OF UNITS OWNED BY PHA.— 
‘‘(A) INSPECTIONS AND RENT DETERMINA-
TIONS.—If’’; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(B) UNITS
OWNED
BY
PHA.—For pur-
poses of this subsection, the term ‘owned by a 
public housing agency’ means, with respect to a 
dwelling unit, that the dwelling unit is in a 
project that is owned by such agency, by an en-
tity wholly controlled by such agency, or by a 
limited liability company or limited partnership 
in which such agency (or an entity wholly con-
trolled by such agency) holds a controlling in-
terest in the managing member or general part-
ner. A dwelling unit shall not be deemed to be 
owned by a public housing agency for purposes 
of this subsection because the agency holds a 
fee interest as ground lessor in the property on 
which the unit is situated, holds a security in-
terest under a mortgage or deed of trust on the 
unit, or holds a non-controlling interest in an 
entity which owns the unit or in the managing 
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member or general partner of an entity which 
owns the unit.’’. 
SEC. 106. PHA PROJECT-BASED ASSISTANCE. 
(a) IN GENERAL.—Paragraph (13) of section 8(o) of 
the United States Housing Act of 1937 (42 U.S.C. 
1437f(o)(13)) is amended— 
(1) by striking ‘‘structure’’ each place such 
term appears and inserting ‘‘project’’; 
(2) by striking subparagraph (B) and inserting 
the following new subparagraph: 
‘‘(B) PERCENTAGE LIMITATION.— 
‘‘(i) IN GENERAL.—Subject to clause 
(ii), a public housing agency may use for 
project-based assistance under this para-
graph not more than 20 percent of the au-
thorized units for the agency. 
‘‘(ii) EXCEPTION.—A public housing 
agency may use up to an additional 10 
percent of the authorized units for the 
agency for project-based assistance under 
this paragraph, to provide units that house 
individuals and families that meet the defi-
nition of homeless under section 103 of the 
McKinney-Vento Homeless Assistance Act 
(42 U.S.C. 11302), that house families 
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with veterans, that provide supportive 
housing to persons with disabilities or el-
derly persons, or that are located in areas 
where vouchers under this subsection are 
difficult to use, as specified in subpara-
graph (D)(ii)(II). Any units of project- 
based assistance that are attached to units 
previously subject to federally required 
rent restrictions or receiving another type 
of long-term housing subsidy provided by 
the Secretary shall not count toward the 
percentage limitation under clause (i) of 
this subparagraph. The Secretary may, by 
regulation, establish additional categories 
for the exception under this clause.’’; 
(3) by striking subparagraph (D) and inserting 
the following new subparagraph: 
‘‘(D) INCOME-MIXING REQUIREMENT.— 
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii), not more than the 
greater of 25 dwelling units or 25 percent 
of the dwelling units in any project may be 
assisted under a housing assistance pay-
ment contract for project-based assistance 
pursuant to this paragraph. For purposes 
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of this subparagraph, the term ‘project’ 
means a single building, multiple contig-
uous buildings, or multiple buildings on 
contiguous parcels of land. 
‘‘(ii) EXCEPTIONS.— 
‘‘(I) CERTAIN
FAMILIES.—The 
limitation under clause (i) shall not 
apply to dwelling units assisted under 
a contract that are exclusively made 
available to elderly families or to 
households eligible for supportive serv-
ices that are made available to the as-
sisted residents of the project, accord-
ing to standards for such services the 
Secretary may establish. 
‘‘(II) CERTAIN AREAS.—With re-
spect to areas in which tenant-based 
vouchers for assistance under this 
subsection are difficult to use, as de-
termined by the Secretary, and with 
respect to census tracts with a poverty 
rate of 20 percent or less, clause (i) 
shall be applied by substituting ‘40 
percent’ for ‘25 percent’, and the Sec-
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retary may, by regulation, establish 
additional conditions. 
‘‘(III) CERTAIN
CONTRACTS.— 
The limitation under clause (i) shall 
not apply with respect to contracts or 
renewal of contracts under which a 
greater percentage of the dwelling 
units in a project were assisted under 
a housing assistance payment contract 
for project-based assistance pursuant 
to this paragraph on the date of the 
enactment of the Housing Oppor-
tunity Through Modernization Act of 
2016. 
‘‘(IV) CERTAIN
PROPERTIES.— 
Any units of project-based assistance 
under this paragraph that are at-
tached to units previously subject to 
federally required rent restrictions or 
receiving other project-based assist-
ance provided by the Secretary shall 
not count toward the percentage limi-
tation imposed by this subparagraph 
(D). 
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‘‘(iii) ADDITIONAL MONITORING AND 
OVERSIGHT
REQUIREMENTS.—The 
Sec-
retary may establish additional require-
ments for monitoring and oversight of 
projects in which more than 40 percent of 
the dwelling units are assisted under a 
housing assistance payment contract for 
project-based assistance pursuant to this 
paragraph.’’; 
(4) by striking subparagraph (F) and inserting 
the following new subparagraph: 
‘‘(F) CONTRACT TERM.— 
‘‘(i) TERM.—A housing assistance 
payment contract pursuant to this para-
graph between a public housing agency 
and the owner of a project may have a 
term of up to 20 years, subject to— 
‘‘(I) the availability of sufficient 
appropriated funds for the purpose of 
renewing expiring contracts for assist-
ance payments, as provided in appro-
priation Acts and in the agency’s an-
nual contributions contract with the 
Secretary, provided that in the event 
of insufficient appropriated funds, 
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payments due under contracts under 
this paragraph shall take priority if 
other cost-saving measures that do 
not require the termination of an ex-
isting contract are available to the 
agency; and 
‘‘(II) compliance with the inspec-
tion requirements under paragraph 
(8), except that the agency shall not 
be required to make biennial inspec-
tions of each assisted unit in the de-
velopment. 
‘‘(ii) ADDITION OF ELIGIBLE UNITS.— 
Subject to the limitations of subparagraphs 
(B) and (D), the agency and the owner 
may add eligible units within the same 
project to a housing assistance payments 
contract at any time during the term 
thereof without being subject to any addi-
tional competitive selection procedures. 
‘‘(iii) HOUSING
UNDER
CONSTRUC-
TION
OR
RECENTLY
CONSTRUCTED.—An 
agency may enter into a housing assistance 
payments contract with an owner for any 
unit that does not qualify as existing hous-
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ing and is under construction or recently 
has been constructed whether or not the 
agency has executed an agreement to enter 
into a contract with the owner, provided 
that the owner demonstrates compliance 
with applicable requirements prior to exe-
cution of the housing assistance payments 
contract. This clause shall not subject a 
housing assistance payments contract for 
existing housing under this paragraph to 
such requirements or otherwise limit the 
extent to which a unit may be assisted as 
existing housing. 
‘‘(iv) ADDITIONAL CONDITIONS.—The 
contract may specify additional conditions, 
including with respect to continuation, ter-
mination, or expiration, and shall specify 
that upon termination or expiration of the 
contract without extension, each assisted 
family may elect to use its assistance 
under this subsection to remain in the 
same project if its unit complies with the 
inspection requirements under paragraph 
(8), the rent for the unit is reasonable as 
required by paragraph (10)(A), and the 
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family pays its required share of the rent 
and the amount, if any, by which the unit 
rent (including the amount allowed for ten-
ant-based utilities) exceeds the applicable 
payment standard.’’; 
(5) in subparagraph (G), by striking ‘‘15 years’’ 
and inserting ‘‘20 years’’; 
(6) by striking subparagraph (I) and inserting 
the following new subparagraph: 
‘‘(I) RENT ADJUSTMENTS.—A housing as-
sistance payments contract pursuant to this 
paragraph entered into after the date of the en-
actment of the Housing Opportunity Through 
Modernization Act of 2016 shall provide for an-
nual rent adjustments upon the request of the 
owner, except that— 
‘‘(i) by agreement of the parties, a 
contract may allow a public housing agency 
to adjust the rent for covered units using 
an operating cost adjustment factor estab-
lished by the Secretary pursuant to section 
524(c) of the Multifamily Assisted Housing 
Reform and Affordability Act of 1997 
(which shall not result in a negative ad-
justment), in which case the contract may 
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require an additional adjustment, if re-
quested, up to the reasonable rent periodi-
cally during the term of the contract, and 
shall require such an adjustment, if re-
quested, upon extension pursuant to sub-
paragraph (G); 
‘‘(ii) the adjusted rent shall not ex-
ceed the maximum rent permitted under 
subparagraph (H); 
‘‘(iii) the contract may provide that 
the maximum rent permitted for a dwelling 
unit shall not be less than the initial rent 
for the dwelling unit under the initial 
housing assistance payments contract cov-
ering the units; and 
‘‘(iv) the provisions of subsection 
(c)(2)(C) shall not apply.’’; 
(7) in subparagraph (J)— 
(A) in the first sentence— 
(i) by striking ‘‘shall’’ and inserting 
‘‘may’’; and 
(ii) by inserting before the period the 
following: ‘‘or may permit owners to select 
applicants from site-based waiting lists as 
specified in this subparagraph’’; 
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(B) by striking the third sentence and in-
serting the following: ‘‘The agency or owner 
may establish preferences or criteria for selec-
tion for a unit assisted under this paragraph 
that are consistent with the public housing 
agency plan for the agency approved under sec-
tion 5A and that give preference to families 
who qualify for voluntary services, including 
disability-specific services, offered in conjunc-
tion with assisted units.’’; and 
(C) by striking the fifth and sixth sen-
tences and inserting the following: ‘‘A public 
housing agency may establish and utilize proce-
dures for owner-maintained site-based waiting 
lists, under which applicants may apply at, or 
otherwise designate to the public housing agen-
cy, the project or projects in which they seek to 
reside, except that all eligible applicants on the 
waiting list of an agency for assistance under 
this subsection shall be permitted to place their 
names on such separate list, subject to policies 
and procedures established by the Secretary. All 
such procedures shall comply with title VI of 
the Civil Rights Act of 1964, the Fair Housing 
Act, section 504 of the Rehabilitation Act of 
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1973, and other applicable civil rights laws. The 
owner or manager of a project assisted under 
this paragraph shall not admit any family to a 
dwelling unit assisted under a contract pursu-
ant to this paragraph other than a family re-
ferred by the public housing agency from its 
waiting list, or a family on a site-based waiting 
list that complies with the requirements of this 
subparagraph. A public housing agency shall 
disclose to each applicant all other options in 
the selection of a project in which to reside that 
are provided by the public housing agency and 
are available to the applicant.’’; 
(8) in subparagraph (M)(ii), by inserting before 
the period at the end the following: ‘‘relating to 
funding other than housing assistance payments’’; 
and 
(9) by adding at the end the following new sub-
paragraphs: 
‘‘(N) STRUCTURE OWNED BY AGENCY.—A 
public housing agency engaged in an initiative 
to improve, develop, or replace a public housing 
property or site may attach assistance to an ex-
isting, newly constructed, or rehabilitated struc-
ture in which the agency has an ownership in-
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terest or which the agency has control of with-
out following a competitive process, provided 
that the agency has notified the public of its in-
tent through its public housing agency plan and 
subject to the limitations and requirements of 
this paragraph. 
‘‘(O) SPECIAL
PURPOSE
VOUCHERS.—A 
public housing agency that administers vouch-
ers authorized under subsection (o)(19) or (x) 
of this section may provide such assistance in 
accordance with the limitations and require-
ments of this paragraph, without additional re-
quirements for approval by the Secretary.’’. 
(b) EFFECTIVE DATE.—The Secretary of Housing 
and Urban Development shall issue notice or regulations 
to implement subsection (a) of this section and such sub-
section shall take effect upon such issuance. 
SEC. 107. ESTABLISHMENT OF FAIR MARKET RENT. 
(a) IN GENERAL.—Paragraph (1) of section 8(c) of 
the United States Housing Act of 1937 (42 U.S.C. 
1437f(c)(1)) is amended— 
(1) by inserting ‘‘(A)’’ after the paragraph des-
ignation; 
(2) by striking the fourth, seventh, eighth, and 
ninth sentences; and 
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(3) by adding at the end the following: 
‘‘(B) Fair market rentals for an area shall be pub-
lished not less than annually by the Secretary on the site 
of the Department on the World Wide Web and in any 
other manner specified by the Secretary. Notice that such 
fair market rentals are being published shall be published 
in the Federal Register, and such fair market rentals shall 
become effective no earlier than 30 days after the date 
of such publication. The Secretary shall establish a proce-
dure for public housing agencies and other interested par-
ties to comment on such fair market rentals and to re-
quest, within a time specified by the Secretary, reevalua-
tion of the fair market rentals in a jurisdiction before such 
rentals become effective. The Secretary shall cause to be 
published for comment in the Federal Register notices of 
proposed material changes in the methodology for esti-
mating fair market rentals and notices specifying the final 
decisions regarding such proposed substantial methodo-
logical changes and responses to public comments.’’. 
(b) PAYMENT STANDARD.—Subparagraph (B) of sec-
tion 8(o)(1) of the United States Housing Act of 1937 
(42 U.S.C. 1437f(o)(1)(B)) is amended by inserting be-
fore the period at the end the following: ‘‘, except that 
no public housing agency shall be required as a result of 
a reduction in the fair market rental to reduce the pay-
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ment standard applied to a family continuing to reside in 
a unit for which the family was receiving assistance under 
this section at the time the fair market rental was reduced. 
The Secretary shall allow public housing agencies to re-
quest exception payment standards within fair market 
rental areas subject to criteria and procedures established 
by the Secretary’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect upon the date of the enact-
ment of this Act. 
SEC. 108. COLLECTION OF UTILITY DATA. 
Section 8(o) of the United States Housing Act of 
1937 (42 U.S.C. 1437f(o)) is amended by adding at the 
end the following new paragraph: 
‘‘(20) COLLECTION OF UTILITY DATA.— 
‘‘(A) PUBLICATION.—The Secretary shall, 
to the extent that data can be collected cost ef-
fectively, regularly publish such data regarding 
utility consumption and costs in local areas as 
the Secretary determines will be useful for the 
establishment of allowances for tenant-paid util-
ities for families assisted under this subsection. 
‘‘(B) USE OF DATA.—The Secretary shall 
provide such data in a manner that— 
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‘‘(i) avoids unnecessary administrative 
burdens for public housing agencies and 
owners; and 
‘‘(ii) protects families in various unit 
sizes and building types, and using various 
utilities, from high rent and utility cost 
burdens relative to income.’’. 
SEC. 109. PUBLIC HOUSING CAPITAL AND OPERATING 
FUNDS. 
(a) CAPITAL FUND REPLACEMENT RESERVES.—Sec-
tion 9 of the United States Housing Act of 1937 (42 
U.S.C. 1437g) is amended— 
(1) in subsection (j), by adding at the end the 
following new paragraph: 
‘‘(7) 
TREATMENT
OF
REPLACEMENT
RE-
SERVE.—The requirements of this subsection shall 
not apply to funds held in replacement reserves es-
tablished pursuant to subsection (n).’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(n) 
ESTABLISHMENT
OF
REPLACEMENT
RE-
SERVES.— 
‘‘(1) IN
GENERAL.—Public housing agencies 
shall be permitted to establish a replacement reserve 
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‘‘(I) 75 percent of such amounts 
among— 
‘‘(I) cities that are the most pop-
ulous unit of general local government 
in a metropolitan statistical area with 
a population greater than 500,000, as 
determined on the basis of the most 
recent census, and with more than 
2,000 individuals living with HIV or 
AIDS, using the data specified in sub-
paragraph (B); and 
‘‘(II) States with more than 
2,000 individuals living with HIV or 
AIDS outside of metropolitan statis-
tical areas. 
‘‘(ii) 25 percent of such amounts 
among States and metropolitan statistical 
areas based on the method described in 
subparagraph (C). 
‘‘(B) SOURCE OF DATA.—For purposes of 
allocating amounts under this paragraph for 
any fiscal year, the number of individuals living 
with HIV or AIDS shall be the number of such 
individuals as confirmed by the Director of the 
Centers for Disease Control and Prevention, as 
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