I
105TH CONGRESS
1ST SESSION
H. R. 1447
To reform the United States Housing Act of 1937, deregulate the public
housing program and the program for rental housing assistance for
low-income families, and increase community control over such programs,
and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
APRIL 24, 1997
Mr. LAZIO of New York (for himself and Mr. Kennedy of Massachusetts)
(both by request) introduced the following bill; which was referred to the
Committee on Banking and Financial Services, and in addition to the
Committee on Ways and Means, for a period to be subsequently deter-
mined by the Speaker, in each case for consideration of such provisions
as fall within the jurisdiction of the committee concerned
A BILL
To reform the United States Housing Act of 1937, deregu-
late the public housing program and the program for
rental housing assistance for low-income families, and
increase community control over such programs, and for
other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
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SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.I20
(a) SHORT TITLE.—This Act may be cited as the ‘‘Public
Housing Management Reform Act of 1997’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows—
Sec. 1. Short title and table contents.
Sec. 2. Findings and purposes.
TITLE I—PUBLIC HOUSING AND RENT REFORMS
Sec. 100. Establishment of capital and operating funds.
Sec. 101. Determination of rental amounts for residents of public housing.
Sec. 102. Minimum rents for public housing and section 8 programs.
Sec. 103. Public housing ceiling rents.
Sec. 104. Disallowance of earned income from public housing and section 8 rent
and family contribution determinations.
Sec. 105. Public housing homeownership.
Sec. 106. Public housing agency plan.
Sec. 107. PHMAP indicators for small PHAs.
Sec. 108. PHMAP self-sufficiency indicator.
Sec. 109. Expansion of powers for dealing with PHAs in substantial default.
Sec. 110. Public housing site-based waiting lists.
Sec. 111. Community service requirements for the public housing and section
8 programs.
Sec. 112. Comprehensive improvement assistance program streamlining.
Sec. 113. Flexibility for PHA funding.
Sec. 114. Replacement housing resources.
Sec. 115. Repeal of one-for-one replacement housing requirement.
Sec. 116. Demolition, site revitalization, replacement housing, and tenant-based
assistance grants for developments.
Sec. 117. Performance evaluation board.
Sec. 118. Economic development and supportive services for public housing
residents.
Sec. 119. Penalty for slow expenditure of modernization funds.
Sec. 120. Designation of PHAs as troubled.
Sec. 121. Volunteer services under the 1937 Act.
Sec. 122. Authorization of appropriations for operation safe home program.
TITLE II—SECTION 8 STREAMLINING AND OTHER PROGRAM
IMPROVEMENTS
Sec. 201. Permanent repeal of Federal preferences.
Sec. 202. Income targeting for public housing and section 8 programs.
Sec. 203. Merger of tenant-based assistance programs.
Sec. 204. Section 8 administrative fees.
Sec. 205. Section 8 homeownership.
Sec. 206. Welfare to work certificates.
Sec. 207. Effect of failure to comply with public assistance requirements.
Sec. 208. Streamlining section 8 tenant-based assistance.
Sec. 209. Income verification.
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Sec. 210. Nondiscrimination against certificate and voucher holders.
Sec. 211. Recapture and reuse of ACC project reserves under the tenant-based
assistance program.
Sec. 212. Expanding the coverage of the Public and Assisted Housing Drug
Elimination Act of 1990 to include other types of crime and
to provide formula funding.
TITLE III—‘‘ONE STRIKE AND YOU’RE OUT’’ OCCUPANCY
PROVISIONS
Sec. 301. Screening of applicants.
Sec. 302. Termination of tenancy and assistance.
Sec. 303. Lease requirements.
Sec. 304. Availability of criminal records for public housing tenant screening
and eviction.
Sec. 305. Definitions.
Sec. 306. Conforming amendments.
SEC. 2. FINDINGS AND PURPOSES.
(a) FINDINGS.—The Congress finds that—
(1) we have a shared national interest in creat-
ing safe, decent and affordable housing because, for
all Americans, housing is an essential building block
toward holding a job, getting an education, partici-
pating in the community, and helping fulfill our na-
tional goals;
(2) the American people recognized this shared
national interest in 1937, when we created a public
housing program dedicated to meeting these needs
while creating more hope and opportunity for the
American people;
(3) for 60 years America’s public housing sys-
tem has provided safe, decent, and affordable hous-
ing for millions of low-income families, who have
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used public housing as a stepping stone toward
greater stability, independence, and homeownership;
(4) today, more than 3,300 local public housing
agencies——95 percent of all housing agencies
throughout America——are providing a good place
for families to live and fulfilling their historic mis-
sion;
(5) yet, for all our progress as a nation, today,
only one out of four Americans who needs housing
assistance receives it;
(6) at the same time, approximately 15 percent
of the people who live in public housing nationwide
live in housing with management designated as
‘‘troubled’’;
(7) for numerous developments at these trou-
bled public hosing agencies and elsewhere, families
face a overwhelming mix of crime, drug trafficking,
unemployment, and despair, where there is little
hope for a better future or a better life;
(8) the past 60 years have resulted in a system
where outdated rules and excessive government regu-
lation are limiting our ability to propose innovative
solutions and solve problems, not only at the rel-
atively few local public housing agencies designated
as troubled, but at the 3,300 that are working well;
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(9) obstacles faced by those agencies that are
working well——multiple reports and cumbersome
regulations——make a compelling case for deregula-
tion and for concentration by the Department of
Housing and Urban Development on fulfillment of
the program’s basic mission;
(10) all told, the Department has drifted from
its original mission, creating bureaucratic processes
that encumber the people and organizations it is
supposed to serve;
(11) under a framework enacted by Congress,
the Department has begun major reforms to address
these problems, with dramatic results;
(12) public housing agencies have begun to de-
molish and replace the worst public housing, reduce
crime, promote resident self-sufficiency, upgrade
management, and end the isolation of public housing
developments from the working world;
(13) the Department has also recognized that
for public housing to work better, the Department
needs to work better, and has begun a major over-
haul of its organization, streamlining operations, im-
proving management, building stronger partnerships
with state and local agencies and improving its abil-
ity to take enforcement actions where necessary to
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assure that its programs serve their intended pur-
poses; and
(14) for these dramatic reforms to succeed, per-
manent legislation is now needed to continue the
transformation of public housing agencies, strip
away outdated rules, provide necessary enforcement
tools, and empower the Department and local agen-
cies to meet the needs of America’s families.
(b) PURPOSE.——It is the purpose of this Act——
(1) to completely overhaul the framework and
rules that were put in place to govern public housing
60 years ago;
(2) to revolutionize the way public housing
serves its clients, fits in the community, builds op-
portunity, and prepares families for a better life;
(3) to reaffirm America’s historic commitment
to safe, decent, and affordable housing and to re-
move the obstacles to meeting that goal;
(4) to continue the complete and total overhaul
of management of the Department;
(5) to dramatically deregulate and reorganize
the Federal government’s management and oversight
of America’s public housing;
(6) to ensure that local public housing agencies
spend more time delivering vital services to residents
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and less time complying with unessential regulations
or filing unessential reports;
(7) to achieve greater accountability of taxpayer
funds by empowering the Federal government to
take firmer, quicker, and more effective actions to
improve the management of troubled local housing
authorities and to crack down on poor performance;
(8) to preserve public housing as a rental re-
source for low-income Americans, while breaking
down the extreme social isolation of public housing
from mainstream America;
(9) to provide for revitalization of severely dis-
tressed public housing, or its replacement with re-
placement with replacement housing or tenant-based
assistance;
(10) to integrate public housing reform with
welfare reform so that welfare receipents—many of
whom are public housing residents—can better chart
a path to independence and self-sufficiency;
(11) to anchor in a permanent statute needed
changes that will result in the continued trans-
formation of the public housing and tenant-based as-
sistance programs— including deregulating well-per-
forming housing agencies, ensuring accountability to
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the public, providing sanctions for poor performers,
and providing additional management tools;
(12) to streamline and simplify the tenant-
based Section 8 program and to make this program
workable for providing homeownership; and
(13) through these comprehensive measures, to
reform the United States Housing Act of 1937 and
the programs thereunder.
TITLE I—PUBLIC HOUSING AND
RENT REFORMS
SEC. 100. ESTABLISHMENT OF CAPITAL AND OPERATING
FUNDS.
(a) CAPITAL FUND.—Section 14(a) of the United
States Housing Act of 1937 is amended—
(1) by redesignating paragraphs (1) through
(5) as subparagraphs (A) through (E), respectively;
(2) by inserting the paragraph designation
‘‘(2)’’ before ‘‘It is the purpose; and
(3) by inserting the following new paragraph
(1) immediately after the subsection designation
‘‘(a)’’;
‘‘(1) The Secretary shall establish a Capital
Fund under this section for the purpose of making
assistance available to public housing agencies in ac-
cordance with this section.’’.
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(b) OPERATING FUND.—Section 9(a) of the United
States Housing Act of 1937 is amended by striking
‘‘SEC.9. (a)(1)(A) In addition to’’ an inserting the follow-
ing:
‘‘SEC. 9. (a) The Secretary shall establish an Operat-
ing Fund under this section for the purpose of making
assistance available to public housing agencies in accord-
ance with this section.
‘‘(1)(A) In addition to’’.
SEC. 101. DETERMINATION OF RENTAL AMOUNTS FOR
RESIDENTS OF PUBLIC HOUSING.
(a) Section 3 of the United States Housing Act of
1937 is amended—
(1) in subsection (a)(1), by revising subpara-
graph (A) to read as follows:
‘‘(A)(i) if the family is assisted under sec-
tion 8 of this Act, 30 per centum of the family’s
monthly adjusted income; or
‘‘(ii) if the family resides in public
housing, an amount established by the
public housing agency not to exceed 30 per
centum of the family’s monthly adjusted
income;’’; and
(2) in subsection (b)(5)—
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(A) after the semicolon following subpara-
graph (F), by inserting ‘‘and’’;
(B) in subparagraph (G), by striking ‘‘;
and’’ and inserting a period; and
(C) by striking subparagraph (H)>
(b) REVISED OPERATING SUBSIDY FORMULA.—The
Secretary, in consultation with interested parties, shall es-
tablish a revised formula for allocating operating assist-
ance under section 9 of the United States Housing Act
of 1937, which formula may include such factors as:
(1) standards for the costs of operation and
reasonable projections of income, taking into account
the character and location of the public housing
project and characteristics of the families served, or
the costs of providing comparable services as deter-
mined with criteria or a formula representing the
operations of a prototype well-managed public hous-
ing project;
(2) the number of public housing dwelling units
owned and operated by the public housing agency,
the percentage of those units that are occupied by
very low-income families, and, if applicable, the re-
duction in the number of public housing unites as a
result of any conversion to a system of tenant-based
assistance;
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(3) the degree of household poverty served by a
public housing agency;
(4) the extent to which the public housing agen-
cy provides programs and activities designed to pro-
mote the economic self-sufficiency and management
skills of public housing tenants;
(5) the number of dwelling units owned and op-
erated by the public housing agency that are chron-
ically vacant and the amount of assistance appro-
priate for those units;
(6) the costs of the public housing agency asso-
ciated with anti-crime and anti-drug activities, in-
cluding the costs of providing adequate security for
public housing tenants;
(7) the ability of the public housing agency to
effectively administer the Operating Fund distribu-
tion of the public housing agency;
(8) incentives to public housing agencies for
good management; and
(9) standards for the costs of operation of as-
sisted housing compared to unassisted housing.
(c) TRANSITION PROVISION.—Prior to the establish-
ment and implementation of an operating subsidy formula
under subsection (b), if a public housing agency estab-
lishes a rental amount that is less than 30 percent of the
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family’s monthly adjusted income pursuant to section
3(a)(1)(A)(ii) of the United States Housing Act of 1937,
as amended by subsection (a)(1), the Secretary shall not
take into account any reduction of or increase in the public
housing agency’s per unit dwelling rental income resulting
from the use of such rental amount when calculating the
contributions under section 9 of the United States Hous-
ing Act of 1937 for the public housing agency for the oper-
ation of the public housing.
SEC. 102. MINIMUM RENTS FOR PUBLIC HOUSING AND SEC-
TION 8 PROGRAMS.
The second sentence of section 3(a)(1) of the United
States Housing Act of 1937 is amended—
(1) at the end of subparagraph (B), by striking
‘‘or’’;
(2) in subsection (C), by striking the period and
inserting’’; or’’; and
(3) by inserting the following at the end: ‘‘(D)
425.
Where establishing the rent or family contribution
based on subparagraph (D) would otherwise result
in undue hardship, as defined by the Secretary or
the pubic housing agency, for one or more categories
of affected families, the Secretary or the public
housing agency may exempt one or more such cat-
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egories from the requirements of this paragraph and
may require a lower minimum monthly rental con-
tribution for one or more such categories.’’.
SEC. 103. PUBLIC HOUSING CEILING RENTS.
(a) Section 3(a)(2)(A) of the United States Housing
Act of 1937, as amended by section 402(b)(1) of the Bal-
anced Budget Downpayment Act, I, is amended to read
as follows:
‘‘(A) adopt ceiling rents that reflect the
reasonable market value of the housing, but
that are not less than—
‘‘(i) for housing other than housing
predominantly for elderly or disabled fami-
lies (or both), 75 percent of the monthly
cost to operate the housing of the agency;
‘‘(ii) for housing predominantly for el-
derly or disabled families (or both), 100
percent of the monthly cost to operate the
housing of the agency; and
‘‘(iii) the monthly cost to make a de-
posit to a replacement reserve (in the sole
discretion of the public housing agency);
and’’.
(b) Notwithstanding section 402(f) of the Balanced
Budget Downpayment Act, I, the amendments made by
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section 402(b) of that Act shall remain in effect after fis-
cal year 1997.
SEC. 104. DISALLOWANCE OF EARNED INCOME FROM PUB-
LIC HOUSING AND SECTION 8 RENT AND FAM-
ILY CONTRIBUTION DETERMINATIONS.
(a) IN GENERAL.—Section 3 of the United States
Housing Act of 1937 is amended—
(1) by striking the undesignated paragraph at
the end of subsection (c)(3) (as added by section
515(b) of Public Law 101–625); and
(2) by adding at the end the following new sub-
section:
‘‘(d) DISALLOWANCE
OF EARNED INCOME FROM
PUBLIC HOUSING AND SECTION 8 RENT AND FAMILY
CONTRIBUTION DETERMINATION.—
‘‘(1) IN GENERAL.—Notwithstanding any other
provision of law, the rent payable under subsection
(a) by, the family contribution determined in accord-
ance with subsection (a) for, a family—
‘‘(A) that—
‘‘(i) occupies a unit in a public hous-
ing project; or
‘‘(ii) receives assistance under section
8; and
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‘‘(B) whose income increases as a result of em-
ployment of a member of the family who was
previously unemployed for one or more years
(including a family whose income increases as a
result of the participation of a family member
in any family self-sufficiency or other job train-
ing program);
may not be increased as a result of the increased in-
come due to such employment during the 18-month
period beginning on the date on which the employ-
ment is commenced.
‘‘(2) PHASE-IN OF RATE INCREASES.—After the
expiration of the 18-month period referred to in
paragraph (1), rent increases due to the continued
employment of the family member described in para-
graph (1)(b) shall be phased in over a subsequent 3-
year period.
‘‘(3) OVERALL
LIMITATION.—Rent payable
under subsection (a) shall not exceed the amount de-
termined under subsection (a).’’.
(b) APPLICABILITY OF AMENDMENT.—
(1) PUBLIC
HOUSING.—Notwithstanding the
amendment made by susbection (a), any tenant of
public housing participating in the program under
the authority contained in the undesignated para-
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sion of a public housing agency (including all or
part of any project or program of the agency),
or if a receiver is appointed by a court, the Sec-
retary or receiver shall be deemed to be acting
not in the official capacity of that person or en-
tity, but rather in the capacity of the public
housing agency, and any liability incurred, re-
gardless of whether the incident giving rise to
that liability occurred while the Secretary or re-
ceiver was in possession of all or part of the
public housing agency (including all or part of
any project or program of the agency), shall be
the liability of the public housing agency.’’.
(b) EFFECTIVENESS.—The provisions of, and
duties and authorities conferred or confirmed by,
subsection (a) shall apply with respect to actions
taken before, on, or after the effective date of this
Act and shall apply to any receivers appointed for a
public housing agency before the date of enactment
of this Act.
(c) TECHNICAL CORRECTION REGARDING AP-
PLICABILITY TO SECTION 8.—Section 8(h) of the
United States Housing Act of 1937 is amended by
inserting after ‘‘6’’ the following: ‘‘(except as pro-
vided in section 6(j)(3))’’.