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housing agencies and owners to have access to 
such income determinations made by other Fed-
eral programs. 
‘‘(F) PHA AND OWNER COMPLIANCE.—A 
public housing agency or owner may not be con-
sidered to fail to comply with this paragraph or 
paragraph (7) due solely to any de minimus er-
rors made by the agency or owner in calculating 
family incomes.’’; 
(2) by striking subsections (d) and (e); and 
(3) by redesignating subsection (f) as sub-
section (d). 
(b) INCOME.—Section 3(b) of the United States 
Housing Act of 1937 (42 U.S.C. 1437a(b)) is amended— 
(1) by striking paragraph (4) and inserting the 
following new paragraph: 
‘‘(4) INCOME.—The term ‘income’ means, with 
respect to a family, income received from all sources 
by each member of the household who is 18 years 
of age or older or is the head of household or spouse 
of the head of the household, plus unearned income 
by or on behalf of each dependent who is less than 
18 years of age, as determined in accordance with 
criteria prescribed by the Secretary, in consultation 
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with the Secretary of Agriculture, subject to the fol-
lowing requirements: 
‘‘(A) INCLUDED AMOUNTS.—Such term in-
cludes recurring gifts and receipts, actual in-
come from assets, and profit or loss from a 
business. 
‘‘(B) EXCLUDED
AMOUNTS.—Such term 
does not include— 
‘‘(i) any imputed return on assets; 
and 
‘‘(ii) any amounts that would be eligi-
ble for exclusion under section 1613(a)(7) 
of the Social Security Act (42 U.S.C. 
1382b(a)(7)). 
‘‘(C) EARNED
INCOME
OF
STUDENTS.— 
Such term does not include earned income of 
any dependent earned during any period that 
such dependent is attending school on a full- 
time basis or any grant-in-aid or scholarship 
amounts related to such attendance used for 
the cost of tuition or books. 
‘‘(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 
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section 530 of the Internal Revenue Code of 
1986 or any qualified tuition program under 
section 529 of such Code. 
‘‘(E) OTHER
EXCLUSIONS.—Such term 
shall not include other exclusions from income 
as are established by the Secretary or any 
amount required by Federal law to be excluded 
from consideration as income. 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.’’; and 
(2) by striking paragraph (5) and inserting the 
following new paragraph: 
‘‘(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: 
‘‘(A) ELDERLY
AND
DISABLED
FAMI-
LIES.—$725 in the case of any family that is 
an elderly family or a disabled family. 
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‘‘(B) DEPENDENTS.—In the case of any 
family that includes a member or members 
who— 
‘‘(i) are less than 18 years of age or 
attending school or vocational training on 
a full-time basis; or 
‘‘(ii) is a person with disabilities who 
is 18 years of age or older and resides in 
the household, 
$500 for each such member. 
‘‘(C) 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, to the extent necessary to en-
able any member of such family to be em-
ployed. 
‘‘(D) PERMISSIVE DEDUCTIONS.—Such ad-
ditional deductions as a public housing agency 
may, at its discretion, establish, except that the 
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Secretary shall establish procedures to ensure 
that such deductions do not increase Federal 
expenditures. 
The Secretary shall annually adjust the amounts of 
the exclusions under subparagraphs (A) and (B), as 
such amounts may have been previously adjusted, by 
applying an inflationary factor as the Secretary 
shall, by regulation, establish. If the dollar amount 
of any such exclusion determined for any year by ap-
plying such inflationary factor is not a multiple of 
$25, the Secretary shall round such amount to the 
next lowest multiple of $25.’’. 
(c) HOUSING CHOICE VOUCHER PROGRAM.—Para-
graph (5) of section 8(o) of the United States Housing 
Act of 1937 (42 U.S.C. 1437f(o)(5)) is amended— 
(1) in the paragraph heading, by striking ‘‘AN-
NUAL REVIEW’’ and inserting ‘‘REVIEWS’’; 
(2) in subparagraph (A)— 
(A) by striking ‘‘the provisions of’’ and in-
serting ‘‘paragraphs (7) and (8) of section 3(a) 
and to’’; and 
(B) by striking ‘‘and shall be conducted 
upon the initial provision of housing assistance 
for the family and thereafter not less than an-
nually’’; and 
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(3) in subparagraph (B), by striking the second 
sentence. 
(d) 
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’’. 
(e) 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. 
(f) IMPACT ON PUBLIC HOUSING REVENUES.— 
(1) INTERACTION
WITH
ASSET
MANAGEMENT 
RULE.—If the Secretary of Housing and Urban De-
velopment determines that the application of the 
amendments made by this section results in a reduc-
tion in the rental income of a public housing agency 
that is not de minimus during the period that the 
operating formula income is frozen at a level that 
does not fully reflect the changes made by such 
amendments, the Secretary shall make appropriate 
adjustments in the formula income of the agency. 
(2) HUD REPORTS ON PUBLIC HOUSING REV-
ENUE IMPACT.—For each of fiscal years 2008 and 
2009, the Secretary of Housing and Urban Develop-
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ment shall submit a report to Congress identifying 
and calculating the impact of changes made by the 
amendments made by this section on the revenues 
and costs of operating public housing units. 
(g) EFFECTIVE
DATE
AND
TRANSITION.—The 
amendments made by this section shall apply with respect 
to fiscal year 2008 and fiscal years thereafter. 
SEC. 4. ELIGIBILITY FOR ASSISTANCE BASED ON ASSETS 
AND INCOME. 
(a) ASSETS.—Section 16 of the United States Hous-
ing Act of 1937 (42 U.S.C. 1437n) is amended by insert-
ing after subsection (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 
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 
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‘‘(B) who has a present ownership interest 
in, and a legal right to reside in, real property 
that is suitable for occupancy 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 this Act; 
‘‘(ii) any person that is a victim of do-
mestic violence; or 
‘‘(iii) any family that is making a 
good faith effort to sell such property. 
‘‘(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 
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 ac-
counts in homeownership programs of the De-
partment of Housing and Urban Development, 
or Family Self Sufficiency accounts. 
‘‘(B) EXCLUSIONS.—Such term does not 
include— 
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‘‘(i) the value of personal property, ex-
cept for items of personal property of sig-
nificant value, as the public housing agen-
cy may determine; 
‘‘(ii) the value of any retirement ac-
count; 
‘‘(iii) any amounts recovered in any 
civil action or settlement based on a claim 
of malpractice, negligence, or other breach 
of duty owed to a member of the family 
and arising out of law, that resulted in a 
member of the family being disabled 
(under the meaning given such term in 
section 1614 of the Social Security Act (42 
U.S.C. 1382c)); and 
‘‘(iv) 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. 
‘‘(C) TRUST
FUNDS.—In cases where 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 
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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. 
‘‘(D) 
SELF-CERTIFICATION.—A 
public 
housing agency or owner may determine the net 
assets of a family, for purposes of this section, 
based on the amounts reported by the family at 
the time the agency or owner reviews the fam-
ily’s income. 
‘‘(3) 
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). 
‘‘(4) 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 
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of the family based on such noncompliance for a pe-
riod of not more than 6 months.’’. 
(b) INCOME.—The United States Housing Act of 
1937 is amended— 
(1) in section 3(a)(1) (42 U.S.C. 1437a(a)(1)), 
by striking the first sentence and inserting the fol-
lowing: ‘‘Dwelling units assisted under this Act may 
be rented, and assistance under this Act may be pro-
vided, whether initially or at time of recertification, 
only to families who are low-income families at the 
time such initial or continued assistance, respec-
tively, is provided, except that families residing in 
dwelling units as of the date of the enactment of the 
Section 8 Voucher Reform Act of 2007 that, under 
agreements in effect on such date of enactment, may 
have incomes up to 95 percent of local area median 
income shall continue to be eligible for assistance at 
recertification as long as they continue to comply 
with such income restrictions. When recertifying 
family income with respect to families residing in 
public housing dwelling units, a public housing agen-
cy may, in the discretion of the agency and only pur-
suant to a policy that is set forth in the public hous-
ing agency plan under section 5A for the agency, 
choose not to enforce the prohibition under the pre-
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