Choice in Affordable Housing Act of 2021
Bill: S.1820 | Sponsor: Sen. Coons, Christopher A. (D-DE)
Policy area: Housing and Community Development

Summary:
Choice in Affordable Housing Act of 2021
This bill establishes programs and grants to incentivize landlord participation in the Housing Choice Voucher program (i.e., Section 8 tenant-based housing assistance).
The bill authorizes the Department of Housing and Urban Development (HUD) to provide one-time incentive payments to landlords, security deposit payments, bonuses to public housing agencies that employ landlord liaisons, and amounts for other recruitment purposes.
The bill also reauthorizes through FY2026 the Tribal Housing and Urban Development-Veterans Affairs Supportive Housing program.
Additionally, the bill allows dwelling units to meet Housing Choice Voucher program inspection requirements by satisfactory inspection through participation in other housing programs.
Landlords not yet participating in a low-income housing assistance program may request inspection by a public housing agency to determine whether the dwelling meets requirements prior to selection by a tenant.
Finally, HUD must expand the use of an alternative method of calculating fair market rent for purposes of the Housing Choice Voucher program.

To increase the number of landlords participating in the Housing Choice 
                            Voucher program.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Choice in Affordable Housing Act of 
2021''.

SEC. 2. DEFINITIONS.

    In this Act--
            (1) the term ``Housing Choice Voucher program'' means the 
        tenant-based assistance program under section 8(o) of the 
        United States Housing Act of 1937 (42 U.S.C. 1437f(o));
            (2) the term ``Secretary'' means the Secretary of Housing 
        and Urban Development; and
            (3) the term ``Tribal Housing and Urban Development-
        Veterans Affairs Supportive Housing program'' means the 
        demonstration program established under paragraph (5) under the 
        heading ``tenant-based rental assistance'' under the heading 
        ``Public and Indian Housing'' in title II of division K of the 
        Consolidated and Further Continuing Appropriations Act, 2015 
        (Public Law 113-235; 128 Stat. 2732) (commonly known as 
        ``Tribal HUD-VASH'').

SEC. 3. FINDINGS.

    Congress finds the following:
            (1) The Housing Choice Voucher program is the Federal 
        Government's largest program helping low-income families, the 
        elderly, and persons with disabilities to afford decent, safe, 
        and sanitary housing in the private market.
            (2) The Housing Choice Voucher program is proven to have 
        positive impacts on voucher holders, including increased 
        housing stability, reduced homelessness, and children lifted 
        out of poverty.
            (3) As a public-private partnership, the Housing Choice 
        Voucher program relies on the willingness of private landlords 
        to accept vouchers.
            (4) Landlord participation is declining in the Housing 
        Choice Voucher program, with an average of 10,000 housing 
        providers leaving the program each year between 2010 and 2016.
            (5) Landlord participation is especially lacking in ``high-
        opportunity neighborhoods'' that have low poverty rates and 
        good access to quality schools, jobs, and public 
        transportation.
            (6) The Secretary has conducted and continues to conduct 
        research on landlord participation in the Housing Choice 
        Voucher program.
            (7) The Moving to Work demonstration program of the 
        Department of Housing and Urban Development has given 
        participating public housing agencies the ability to test 
        innovative strategies to incentivize landlords to accept 
        vouchers.
            (8) Indian Tribes and tribally designated housing entities, 
        which do not participate in the Housing Choice Voucher program, 
        benefit from the Tribal Housing and Urban Development-Veterans 
        Affairs Supportive Housing program, which provides rental 
        assistance to Native American veterans who are experiencing or 
        at risk of experiencing homelessness.

SEC. 4. SENSE OF CONGRESS.

    It is the sense of Congress that the Housing Choice Voucher program 
should be improved to increase the number of landlords, particularly 
landlords with units in high-opportunity neighborhoods, who accept 
vouchers in order to expand housing choice and opportunity, and further 
fair housing.

SEC. 5. INCENTIVIZING LANDLORD PARTICIPATION IN HOUSING CHOICE VOUCHER 
              PROGRAM.

    (a) One-Time Incentive Payments.--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:
            ``(21) One-time incentive payments.--
                    ``(A) Definition.--In this paragraph, the term 
                `eligible unit' means a dwelling unit that--
                            ``(i) is located in a census tract with a 
                        poverty rate of less than 20 percent; and
                            ``(ii) has not previously been subject to a 
                        housing assistance payment contract under this 
                        subsection.
                    ``(B) Incentive payment authority.--
                            ``(i) In general.--To incentivize landlords 
                        who own dwelling units in low-poverty areas to 
                        enter into housing assistance payment contracts 
                        under this subsection, the Secretary shall 
                        provide assistance under this paragraph to 
                        public housing agencies to be used to offer a 
                        one-time payment directly to the owner of an 
                        eligible unit entering into a housing 
                        assistance payment contract with the public 
                        housing agency for the eligible unit.
                            ``(ii) Amount.--The amount of an incentive 
                        payment made to an eligible owner under clause 
                        (i) may not exceed 200 percent of the monthly 
                        housing assistance payment made to the eligible 
                        owner for the eligible unit.
                            ``(iii) Conditions permitted.--Subject to 
                        paragraph (7), a public housing agency may 
                        require the owner of an eligible unit, as a 
                        condition of receiving an incentive payment 
                        under clause (i), to commit to lease the 
                        eligible unit to tenants assisted under this 
                        subsection for more than 1 year.
                            ``(iv) Limit.--The owner of an eligible 
                        unit may not receive more than 1 incentive 
                        payment under clause (i), regardless of--
                                    ``(I) the number of eligible units 
                                owned by the owner; or
                                    ``(II) the number of public housing 
                                agencies with which the owner has 
                                entered into housing assistance payment 
                                contracts.''.
    (b) Security Deposit Payments.--Section 8(o) of the United States 
Housing Act of 1937 (42 U.S.C. 1437f(o)), as amended by subsection (a), 
is amended by adding at the end the following:
            ``(22) Security deposit payments.--
                    ``(A) Security deposit payment authority.--The 
                Secretary shall provide assistance to public housing 
                agencies to be used to pay the owner of a dwelling unit 
                assisted under this subsection for a security deposit, 
                or a substantial portion thereof, on behalf of the 
                tenant of the dwelling unit in accordance with 
                subparagraph (B).
                    ``(B) Minimum pha requirements.--A public housing 
                agency that receives assistance from the Secretary 
                under subparagraph (A) shall administer the assistance 
                in accordance with the following conditions:
                            ``(i) The public housing agency shall pay 
                        the owners of dwelling units assisted under 
                        this subsection for a security deposit, or a 
                        substantial portion thereof, in an amount 
                        determined by the public housing agency, on 
                        behalf of the tenants of the dwelling units.
                            ``(ii) In making payments to owners of 
                        dwelling units under clause (i), the public 
                        housing agency shall give priority to owners of 
                        dwelling units occupied by extremely low-income 
                        families.
                            ``(iii) The owner of a dwelling unit may 
                        deduct amounts from a security deposit payment 
                        received under clause (i) to cover damages 
                        beyond normal wear and tear caused by the 
                        tenant of the dwelling unit, any member of the 
                        tenant's household, or any guest or other 
                        person under the tenant's control.
                            ``(iv) The public housing agency shall 
                        conduct a damage claims process whereby--
                                    ``(I) in order to deduct amounts 
                                from a security deposit payment 
                                received under clause (i), the owner of 
                                a covered dwelling unit must submit a 
                                claim to the public housing agency with 
                                an itemized list of damages and 
                                evidence and request reimbursement; and
                                    ``(II) the tenant of a covered 
                                dwelling unit may refute a claim 
                                submitted under subclause (I).
                            ``(v) The public housing agency shall--
                                    ``(I) establish an amount of repair 
                                costs for which a tenant will be 
                                responsible; and
                                    ``(II) notify a tenant, upon the 
                                tenant entering into a lease for a 
                                dwelling unit assisted under this 
                                subsection, of the amount described in 
                                subclause (I).
                            ``(vi) The public housing agency may 
                        determine what action to take if a tenant 
                        demonstrates an inability to pay the amount of 
                        repair costs for which the tenant is 
                        responsible under clause (v).
                            ``(vii) At the end of a tenant's occupancy 
                        of a dwelling unit assisted under this 
                        subsection, the landlord shall return to the 
                        public housing agency any unused amount of a 
                        security deposit payment received under clause 
                        (i).
                    ``(C) Rule of construction.--Nothing in 
                subparagraph (B) shall be construed to prohibit a 
                public housing agency from establishing additional 
                conditions for the administration of assistance 
                received under subparagraph (A) in accordance with 
                applicable State and local laws.''.
    (c) Landlord Liaison Bonus Payments.--Section 8(o) of the United 
States Housing Act of 1937 (42 U.S.C. 1437f(o)), as amended by 
subsection (b), is amended by adding at the end the following:
            ``(23) Landlord liaison bonus payments.--
                    ``(A) In general.--Each year, the Secretary shall 
                award 1 bonus payment to each public housing agency 
                that employs, contracts with a service partner that 
                employs, or demonstrates an intent to employ or 
                contract with a service partner that employs, not less 
                than 1 dedicated landlord liaison whose duties include, 
                with respect to the tenant-based assistance program 
                under subsection (o)--
                            ``(i) conducting landlord outreach, 
                        recruitment, and retention;
                            ``(ii) educating and training landlords 
                        regarding the program; and
                            ``(iii) operating a phone hotline, online 
                        portal, monitored email address, or other 
                        mechanism designated by the Secretary for 
                        landlord questions and concerns regarding the 
                        program.
                    ``(B) Demonstrating compliance.--The Secretary 
                shall determine how a public housing agency may 
                demonstrate that it offers or intends to offer a 
                landlord liaison service for purposes of subparagraph 
                (A).
                    ``(C) Amount.--The Secretary shall establish an 
                amount for the landlord liaison bonus payment 
                authorized under subparagraph (A) that--
                            ``(i) may vary by region;
                            ``(ii) does not exceed the 150 percent of 
                        the average cost of employing, or contracting 
                        with a service partner that employs, such a 
                        landlord liaison, based on local market 
                        conditions; and
                            ``(iii) is sufficient to incentivize public 
                        housing agencies to employ, or contact with a 
                        service partner that employs, such a landlord 
                        liaison.''.
    (d) Housing Partnership Fund.--Section 8 of the United States 
Housing Act of 1937 (42 U.S.C. 1437f) is amended by adding at the end 
the following:
    ``(ee) Herschel Lashkowitz Housing Partnership Fund.--
            ``(1) Establishment.--The Secretary shall establish a fund, 
        to be known as the `Herschel Lashkowitz Housing Partnership 
        Fund', for the purpose of incentivizing landlords to 
        participate in the tenant-based assistance program under 
        subsection (o) in accordance with paragraph (2) of this 
        subsection.
            ``(2) Authorized uses.--The Secretary shall use amounts 
        from the Housing Partnership Fund for--
                    ``(A) incentive payments under subsection (o)(21);
                    ``(B) security deposit payments under subsection 
                (o)(22);
                    ``(C) landlord liaison bonus payments under 
                subsection (o)(23); and
                    ``(D) other uses, as determined by a public housing 
                agency and approved by the Secretary, designed 
                primarily--
                            ``(i) to recruit owners of dwelling units, 
                        particularly dwelling units in census tracts 
                        with a poverty rate of less than 20 percent, to 
                        enter into housing assistance payment contracts 
                        under subsection (o); and
                            ``(ii) to ensure that owners that enter 
                        into housing assistance payment contracts as 
                        described in clause (i) of this subparagraph 
                        continue to lease their dwelling units to 
                        tenants assisted under subsection (o).
            ``(3) Reports.--The Secretary shall require a public 
        housing agency that receives assistance from the Herschel 
        Lashkowitz Housing Partnership Fund to submit an annual report 
        to the Secretary on the use of the assistance.
            ``(4) Authorization of additional appropriations.--There is 
        authorized to be appropriated for deposit in the Herschel 
        Lashkowitz Housing Partnership Fund $100,000,000 for each of 
        fiscal years 2022 through 2026, to remain available until 
        expended.''.

SEC. 6. TRIBAL HUD-VASH AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated to the Secretary of Housing 
and Urban Development $7,000,000 for each of fiscal years 2022 through 
2026 for the Tribal Housing and Urban Development-Veterans Affairs 
Supportive Housing program.

SEC. 7. HOUSING QUALITY STANDARDS.

    (a) Satisfaction of Inspection Requirements Through Participation 
in Other Housing Programs.--Section 8(o)(8) of the United States 
Housing Act of 1937 (42 U.S.C. 1437f(o)(8)), as amended by section 
101(a) of the Housing Opportunity Through Modernization Act of 2016 
(Public Law 114-201; 130 Stat. 783), is amended by adding at the end 
the following:
                    ``(I) Satisfaction of inspection requirements 
                through participation in other housing programs.--
                            ``(i) Low-income housing tax credit-
                        financed buildings.--A dwelling unit shall be 
                        deemed to meet the inspection requirements 
                        under this paragraph if--
                                    ``(I) the dwelling unit is in a 
                                building, the acquisition, 
                                rehabilitation, or construction of 
                                which was financed by a person who 
                                received a low-income housing tax 
                                credit under section 42 of the Internal 
                                Revenue Code of 1986 in exchange for 
                                that financing;
                                    ``(II) the dwelling unit was 
                                physically inspected and passed 
                                inspection as part of the low-income 
                                housing tax credit program described in 
                                subclause (I) during the preceding 12-
                                month period; and
                                    ``(III) the applicable public 
                                housing agency is able to obtain the 
                                results of the inspection described in 
                                subclause (II).
                            ``(ii) HOME investment partnerships 
                        program.--A dwelling shall be deemed to meet 
                        the inspection requirements under this 
                        paragraph if the dwelling unit--
                                    ``(I) the dwelling unit is assisted 
                                under the HOME Investment Partnerships 
                                Program under title II of the Cranston-
                                Gonzalez National Affordable Housing 
                                Act (42 U.S.C. 12721 et seq.);
                                    ``(II) the dwelling unit was 
                                physically inspected and passed 
                                inspection as part of the program 
                                described in subclause (I) during the 
                                preceding 12-month period; and
                                    ``(III) the applicable public 
                                housing agency is able to obtain the 
                                results of the inspection described in 
                                subclause (II).
                            ``(iii) Rural housing service.--A dwelling 
                        unit shall be deemed to meet the inspection 
                        requirements under this paragraph if--
                                    ``(I) the dwelling unit is assisted 
                                by the Rural Housing Service of the 
                                Department of Agriculture;
                                    ``(II) the dwelling unit was 
                                physically inspected and passed 
                                inspection in connection with the 
                                assistance described in subclause (I) 
                                during the preceding 12-month period; 
                                and
                                    ``(III) the applicable public 
                                housing agency is able to obtain the 
                                results of the inspection described in 
                                subclause (II).
                            ``(iv) Rule of construction.--Nothing in 
                        clause (i), (ii), or (iii) shall be construed 
                        to affect the operation of a housing program 
                        described in, or authorized under a provision 
                        of law described in, that clause.''.
    (b) Pre-Approval of Units.--Section 8(o)(8)(A) of the United States 
Housing Act of 1937 (42 U.S.C. 1437f(o)(8)(A)) is amended by adding at 
the end the following:
                            ``(iv) Initial inspection prior to lease 
                        agreement.--
                                    ``(I) Definition.--In this clause, 
                                the term `new landlord' means an owner 
                                of a dwelling unit who has not 
                                previously entered into a housing 
                                assistance payment contract with a 
                                public housing agency under this 
                                subsection for any dwelling unit.
                                    ``(II) Early inspection.--Upon the 
                                request of a new landlord, a public 
                                housing agency may inspect the dwelling 
                                unit owned by the new landlord to 
                                determine whether the unit meets the 
                                housing quality standards under 
                                subparagraph (B) before the unit is 
                                selected by a tenant assisted under 
                                this subsection.
                                    ``(III) Effect.--An inspection 
                                conducted under subclause (II) that 
                                determines that the dwelling unit meets 
                                the housing quality standards under 
                                subparagraph (B) shall satisfy this 
                                subparagraph and subparagraph (C) if 
                                the new landlord enters into a lease 
                                agreement with a tenant assisted under 
                                this subsection not later than 60 days 
                                after the date of the inspection.
                                    ``(IV) Information when family is 
                                selected.--When a public housing agency 
                                selects a family to participate in the 
                                tenant-based assistance program under 
                                this subsection, the public housing 
                                agency shall include in the information 
                                provided to the family a list of 
                                dwelling units that have been inspected 
                                under subclause (II) and determined to 
                                meet the housing quality standards 
                                under subparagraph (B).''.

SEC. 8. SMALL AREA FAIR MARKET RENT.

    (a) Use of Small Area Fair Market Rent.--Section 8(o)(1) of the 
United States Housing Act of 1937 (42 U.S.C. 1437f(o)(1)) is amended by 
adding at the end the following:
                    ``(F) Small area fair market rent.--
                            ``(i) Definitions.--In this subparagraph--
                                    ``(I) the term `metropolitan area' 
                                means a metropolitan statistical area, 
                                as defined by the Office of Management 
                                and Budget; and
                                    ``(II) the term `small area fair 
                                market rent' means the fair market rent 
                                established for a ZIP code area within 
                                a metropolitan area.
                            ``(ii) Use of small area fair market 
                        rent.--Notwithstanding subsection (c) or any 
                        other provision of this subsection, not later 
                        than 3 years after the date of enactment of 
                        this subparagraph, the Secretary shall 
                        designate a number of metropolitan areas in 
                        which public housing agencies are required to 
                        use the small area fair market rent to 
                        determine the fair market rental for dwelling 
                        units for purposes of tenant-based assistance 
                        under this subsection that is not less than 3 
                        times the number of metropolitan areas so 
                        designated in the final rule of the Secretary 
                        entitled `Establishing a More Effective Fair 
                        Market Rent System; Using Small Area Fair 
                        Market Rents in the Housing Choice Voucher 
                        Program Instead of the Current 50th Percentile 
                        FMRs', published in the Federal Register on 
                        November 16, 2016 (81 Fed. Reg. 80567).
                            ``(iii) Hold harmless.--If the application 
                        of clause (ii) would cause a decrease in the 
                        payment standard used to calculate the amount 
                        of tenant-based assistance provided to a family 
                        under this subsection, a public housing agency 
                        shall continue to use the existing higher 
                        payment standard to calculate the amount of 
                        such assistance for the family for as long as 
                        the family continues to receive such assistance 
                        in the same dwelling unit.''.
    (b) Conforming Amendment.--Section 8(o)(1)(B) of the United States 
Housing Act of 1937 (42 U.S.C. 1437f(o)(1)(B)) is amended by inserting 
after ``subsection (c)'' the following: ``(subject to subparagraph (F) 
of this paragraph)''.

SEC. 9. SECTION 8 MANAGEMENT ASSESSMENT PROGRAM.

    (a) Definition.--In this section, the term ``Section 8 Management 
Assessment Program'' means the program set forth in part 985 of title 
24, Code of Federal Regulations (or any successor regulation).
    (b) Deconcentration of Participating Dwelling Units.--The Secretary 
shall explore ways to reform and modernize the Section 8 Management 
Assessment Program to assess public housing agencies in a manner that 
promotes--
            (1) positive interactions with landlords, including timely 
        payment of rent and identification of the dwelling unit for 
        which a subsidy payment is being made; and
            (2) an increase in the diversity of areas where dwelling 
        units are leased to support voucher holders who want to access 
        to low-poverty, integrated neighborhoods.
    (c) Rule of Construction.--Nothing in subsection (b) shall be 
construed to prevent the Secretary from--
            (1) reforming the Section 8 Management Assessment Program 
        to assess public housing agencies in other areas of 
        performance; or
            (2) reforming the Section 8 Management Assessment Program 
        in any other manner, at the discretion of the Secretary.

SEC. 10. ANNUAL REPORT ON EFFECTIVENESS OF ACT.

    (a) Definitions.--In this section--
            (1) the term ``appropriate congressional committees'' 
        means--
                    (A) the Committee on Banking, Housing, and Urban 
                Affairs of the Senate;
                    (B) the Subcommittee on Transportation, Housing and 
                Urban Development, and Related Agencies of the 
                Committee on Appropriations of the Senate;
                    (C) the Committee on Financial Services of the 
                House of Representatives; and
                    (D) the Subcommittee on Transportation, Housing and 
                Urban Development, and Related Agencies of the 
                Committee on Appropriations of the House of 
                Representatives; and
            (2) the term ``high-opportunity area''--
                    (A) shall be defined by the Secretary for purposes 
                of this section; and
                    (B) does not include any census tract in which the 
                poverty rate is equal to or greater than 20 percent.
    (b) Report.--Not later than 1 year after the date of enactment of 
this Act, and annually thereafter for 5 total years, the Secretary 
shall submit to the appropriate congressional committees and make 
publicly available a report that--
            (1) evaluates the effectiveness of this Act and the 
        amendments made by this Act in recruiting and retaining 
        landlords who accept vouchers under the Housing Choice Voucher 
        program, particularly landlords with dwelling units in high-
        opportunity neighborhoods; and
            (2) includes--
                    (A) the number of landlords in the United States 
                who accept housing choice vouchers under the Housing 
                Choice Voucher program and the number of dwelling units 
                assisted under the Housing Choice Voucher program;
                    (B) any net changes to the number of landlords or 
                dwelling units described in subparagraph (A) during the 
                preceding year;
                    (C) the number of landlords described in 
                subparagraph (A) who own disability-accessible dwelling 
                units assisted under the Housing Choice Voucher program 
                and the number of those dwelling units; and
                    (D) the number of landlords described in 
                subparagraph (A) who own dwelling units assisted under 
                the Housing Choice Voucher program in high-opportunity 
                areas and the number of those dwelling units.
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