Affordable Housing Preservation Act of 1999

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Affordable Housing Preservation Act 
of 1999''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) availability of low-income housing rental units has 
        declined nationwide in the last several years;
            (2) as rents for low-income housing increase and the 
        development of new units of affordable housing decreases, there 
        are fewer privately owned, federally assisted affordable 
        housing units available to low-income individuals in need;
            (3) the demand for affordable housing far exceeds the 
        supply of such housing, as evidenced by recent studies; and
            (4) the efforts of nonprofit organizations have 
        significantly preserved and expanded access to low-income 
        housing.
    (b) Purposes.--The purposes of this Act are--
            (1) to continue the partnerships among the Federal 
        Government, State and local governments, nonprofit 
        organizations, and the private sector in operating and 
        assisting housing that is affordable to low-income persons and 
        families;
            (2) to promote the preservation of affordable housing units 
        by providing matching grants to States that have developed and 
        funded programs for the preservation of privately owned housing 
        that is affordable to low-income families and persons; and
            (3) to minimize the involuntary displacement of tenants who 
        are currently residing in such housing, many of whom are 
        elderly or disabled persons and families with children.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Capital expenditures.--The term ``capital 
        expenditures'' includes expenditures for acquisition and 
        rehabilitation.
            (2) Low-income affordability restrictions.--The term ``low-
        income affordability restrictions'' means, with respect to a 
        housing project, any limitations imposed by law, regulation, or 
        regulatory agreement on rents for tenants of the project, rent 
        contributions for tenants of the project, or income-eligibility 
        for occupancy in the project.
            (3) Project-based assistance.--The term ``project-based 
        assistance'' has the meaning given such term in section 16(c) 
        of the United States Housing Act of 1937 (42 U.S.C. 1437n(c)), 
        except that such term includes assistance under any successor 
        programs to the programs referred to in such section.
            (4) Secretary.--The term ``Secretary'' means the Secretary 
        of Housing and Urban Development.
            (5) State.--The term ``State'' means each of the several 
        States and the District of Columbia.

SEC. 4. AUTHORITY.

    The Secretary shall, to the extent amounts are made available in 
advance under section 12, award grants under this Act to States for 
low-income housing preservation and promotion.

SEC. 5. APPLICATIONS.

    The Secretary shall provide for States (through appropriate State 
agencies) to submit applications for grants under this Act. The 
Secretary shall require the applications to contain any information and 
certifications necessary for the Secretary to determine who is eligible 
to receive such a grant.

SEC. 6. USE OF GRANTS.

    (a) Eligible Uses.--
            (1) In general.--Amounts from grants awarded under this Act 
        may be used by States only for the purpose of providing 
        assistance for acquisition, rehabilitation, operating costs, 
        and capital expenditures for a housing project that meets the 
        requirements under subsection (b), (c), (d), or (e).
            (2) Factors for consideration.--In selecting projects 
        described in paragraph (1) for assistance with amounts from a 
        grant awarded under this Act, the State shall--
                    (A) take into consideration--
                            (i) whether the assistance will be used to 
                        transfer the project to a resident-endorsed 
                        nonprofit organization;
                            (ii) whether the owner of the project has 
                        extended the low-income affordability 
                        restrictions on the project for a period of 
                        more than 15 years;
                            (iii) the extent to which the project is 
                        consistent with the comprehensive housing 
                        affordability strategy approved in accordance 
                        with section 105 of the Cranston-Gonzalez 
                        National Affordable Housing Act (42 U.S.C. 
                        12705) for the jurisdiction in which the 
                        project is located;
                            (iv) the extent to which the project 
                        location provides access to transportation, 
                        jobs, shopping, and other similar conveniences;
                            (v) the extent to which the project meets 
                        fair housing goals;
                            (vi) the extent to which the project serves 
                        specific needs that are not otherwise met by 
the local market, such as housing for the elderly or disabled, or 
families with children;
                            (vii) the extent of local government 
                        resources provided to the project; and
                            (viii) such other factors as the Secretary 
                        or the State may establish; and
                    (B) ensure that, to the maximum extent practicable, 
                projects in both urban and rural areas in the State 
                receive assistance.
    (b) Projects With HUD-Insured Mortgages.--A project meets the 
requirements under this subsection only if--
            (1) the project is financed by a loan or mortgage that is--
                    (A) insured or held by the Secretary under section 
                221(d)(3) of the National Housing Act (12 U.S.C. 
                1715l(d)(3)) and receiving loan management assistance 
                under section 8 of the United States Housing Act of 
                1937 (42 U.S.C. 1437f) due to a conversion from section 
                101 of the Housing and Urban Development Act of 1965 
                (12 U.S.C. 1701s);
                    (B) insured or held by the Secretary and bears 
                interest at a rate determined under the proviso of 
                section 221(d)(5) of the National Housing Act (12 
                U.S.C. 1715l(d)(5)); or
                    (C) insured, assisted, or held by the Secretary or 
                a State or State agency under section 236 of the 
                National Housing Act (12 U.S.C. 1715z-1);
            (2) the project is subject to an unconditional waiver of, 
        with respect to the mortgage referred to in paragraph (1)--
                    (A) all rights to any prepayment of the mortgage; 
                and
                    (B) all rights to any voluntary termination of the 
                mortgage insurance contract for the mortgage; and
            (3) if the low-income affordability restrictions on the 
        project are for less than 15 years, the owner of the project 
        has entered into binding commitments (applicable to any 
        subsequent owner) to extend those restrictions, including any 
        such restrictions imposed because of any contract for project-
        based assistance for the project, for a period of not less than 
        15 years (beginning on the date on which assistance is made 
        available for the project by the State under this section).
    (c) Projects With Section 8 Project-Based Assistance.--A project 
meets the requirements under this subsection only if--
            (1) the project is subject to a contract for project-based 
        assistance; and
            (2) the owner of the project has entered into binding 
        commitments (applicable to any subsequent owner)--
                    (A) to continue to renew such contract (if offered 
                on the same terms and conditions) until the later of--
                            (i) the last day of the remaining term of 
                        the mortgage; or
                            (ii) the date that is 15 years after the 
                        date on which assistance is made available for 
                        the project by the State under this section; 
                        and
                    (B) to extend any low-income affordability 
                restrictions applicable to the project in connection 
                with such assistance.
    (d) Projects Purchased by Residents.--A project meets the 
requirements under this subsection only if the project--
            (1) is or was eligible low-income housing (as defined in 
        section 229 of the Low-Income Housing Preservation and Resident 
        Homeownership Act of 1990 (42 U.S.C. 4119)) or is or was a 
        project assisted under section 613(b) of the Cranston-Gonzalez 
        National Affordable Housing Act (12 U.S.C. 4125(b));
            (2) has been purchased by a resident council or resident-
        approved nonprofit organization for the housing or is approved 
        by the Secretary for such purchase, for conversion to 
        homeownership housing under a resident homeownership program 
        meeting the requirements under section 226 of such Act (12 
        U.S.C. 4116); and
            (3) the owner of the project has entered into binding 
        commitments (applicable to any subsequent owner) to extend such 
        assistance for not less than 15 years (beginning on the date on 
        which assistance is made available for the project by the State 
        under this section) and to extend any low-income affordability 
        restrictions applicable to the project in connection with such 
        assistance.
    (e) Rural Rental Assistance Projects.--A project meets the 
requirements of this section only if--
            (1) the project is a rural rental housing project financed 
        under section 515 of the Housing Act of 1949 (42 U.S.C. 1485); 
        and
            (2) the restriction on the use of the project (as required 
        under section 502 of the Housing Act of 1949 (42 U.S.C. 1472)) 
        will expire not later than 12 months after the date on which 
        assistance is made available for the project by the State under 
        this section.

SEC. 7. AMOUNT OF STATE GRANTS.

    (a) In General.--Subject to section 8, in each fiscal year, the 
Secretary shall award to each State approved for a grant under this Act 
a grant in an amount based upon the proportion of such State's need for 
assistance under this Act (as determined by the Secretary in accordance 
with subsection (b)) to the aggregate need among all States approved 
for such assistance for such fiscal year.
    (b) Determination of Need.--In determining the proportion of a 
State's need under subsection (a), the Secretary shall consider--
            (1) the number of units in projects in the State that are 
        eligible for assistance under section 6 that, due to market 
        conditions or other factors, are at risk for prepayment, opt-
        out, or otherwise at risk of being lost to the inventory of 
        affordable housing; and
            (2) the difficulty that residents of projects in the State 
        that are eligible for assistance under section 6 would face in 
        finding adequate, available, decent, comparable, and affordable 
        housing in neighborhoods of comparable quality in the local 
        market, if those projects were not assisted by the State under 
        section 6.

SEC. 8. MATCHING REQUIREMENT.

    (a) In General.--The Secretary may not award a grant under this Act 
to a State for any fiscal year in an amount that exceeds twice the 
amount that the State certifies, as the Secretary shall require, that 
the State will contribute for such fiscal year, or has contributed 
since January 1, 1999, from non-Federal sources for the purposes 
described in section 6(a).
    (b) Treatment of Previous Contributions.--Any portion of amounts 
contributed after January 1, 1999, that are counted for purposes of 
meeting the requirement under subsection (a) for a fiscal year may not 
be counted for such purposes for any subsequent fiscal year.
    (c) Treatment of Tax Incentives.--Fifty percent of the funds used 
for the project that are allocable to tax credits allocated under 
section 42 of the Internal Revenue Code of 1986, revenue from mortgage 
revenue bonds issued under section 143 of such Code, or proceeds from 
the sale of tax-exempt bonds by any State or local government entity 
shall be considered non-Federal sources for purposes of this section.

SEC. 9. TREATMENT OF SUBSIDY LAYERING REQUIREMENTS.

    Neither section 8 nor any other provision of this Act may be 
construed to prevent the use of tax credits allocated under section 42 
of the Internal Revenue Code of 1986 in connection with housing 
assisted with amounts from a grant awarded under this Act, to the 
extent that such use is in accordance with section 102(d) of the 
Department of Housing and Urban Development Reform Act of 1989 (42 
U.S.C. 3545(d)) and section 911 of the Housing and Community 
Development Act of 1992 (42 U.S.C. 3545 note).

SEC. 10. REPORTS.

    (a) Reports to Secretary.--Not later than 90 days after the last 
day of each fiscal year, each State that receives a grant under this 
Act during that fiscal year shall submit to the Secretary a report on 
the housing projects assisted with amounts made available under the 
grant.
    (b) Reports to Congress.--Based on the reports submitted under 
subsection (a), the Secretary shall annually submit to Congress a 
report on the grants awarded under this section during the preceding 
fiscal year and the housing projects assisted with amounts made 
available under those grants.

SEC. 11. REGULATIONS.

    Not later than 12 months after the date of enactment of this Act, 
the Secretary shall issue regulations to carry out this Act.

SEC. 12. AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated for grants under this Act 
such sums as may be necessary for each of fiscal years 2000 through 
2004.

Summary: Affordable Housing Preservation Act of 1999 - Directs the Secretary of Housing and Urban Development to make matching grants to States to supplement State and local assistance for the preservation and promotion of low-income housing. 
Sets forth eligibility requirements for: (1) projects with Department of Housing and Urban Development-insured mortgages; (2) projects with section 8 project based assistance; (3) projects purchased by residents; and (4) rural rental assistance projects. 
Authorizes appropriations.