Restoring Communities Left Behind Act
Bill: H.R.816 | Sponsor: Rep. Kaptur, Marcy (D-OH)
Policy area: Housing and Community Development

Summary:
Restoring Communities Left Behind Act
This bill directs the Department of Housing and Urban Development to establish a grant program for local partnerships to carry out neighborhood revitalization support activities in economically distressed areas. Eligible activities include

To direct the Secretary of Housing and Urban Development to establish a 
  grant program to help revitalize certain localities, and for other 
                               purposes.

    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 ``Restoring Communities Left Behind 
Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) As the Nation continues to feel the devastating 
        economic impacts of Coronavirus Disease 2019 (COVID-19), many 
        urban and rural communities are still suffering from the 
        effects of underwater mortgages, vacancy, abandoned properties, 
        blight, aging housing stock, properties with deferred 
        maintenance and harmful materials such as lead, asbestos, and 
        mold, unemployment, and population loss.
            (2) While some cities and counties struggle with 
        disinvestment and population loss, there are also pockets of 
        economic distress in otherwise prosperous, growing areas.
            (3) Investments targeted to these communities left behind 
        will be critical to ensure equitable economic recovery, job 
        creation, and housing and neighborhood infrastructure 
        revitalization.
            (4) The need to revitalize neighborhoods is greater than 
        what can be supported with existing local tax bases.
            (5) Communities continue to suffer from the impact of 
        governmental policies and private sector practices that forbade 
        or discouraged mortgage lending in neighborhoods having 
        significant minority populations.
            (6) Many State and local governments, land banks, and 
        nonprofit organizations across the United States have responded 
        to the housing crisis by creating cost-effective strategies to 
        revitalize neighborhoods.
            (7) 2016 data from the United States Census Bureau shows 
        that non-Hispanic, White households have an average net worth 
        of $143,600, while Black households have an average net worth 
        of $12,920, and Hispanic households have an average net worth 
        of $21,420.
            (8) Housing equity is a significant portion of Black and 
        Hispanic households' net worth, making up nearly 57 percent of 
        Black households' net worth, 66.5 percent of Hispanic 
        households' net worth, and 40.8 percent of White households' 
        net worth, according to the Urban Institute's calculations from 
        the 2016 Survey of Consumer Finances.
            (9) The 2008 Great Recession and the COVID-19 Recession 
        have exacerbated the racial wealth gap.
            (10) Funding innovative local neighborhood strategies will 
        allow the United States to close the racial wealth gap, ensure 
        equitable access to housing and economic mobility, and counter 
        the lasting legacy of redlining policies.
            (11) Despite the strong requirement to affirmatively 
        furthering fair housing under the Fair Housing Act, the lack of 
        accountability measures implemented by the Department of 
        Housing and Urban Development to ensure equitable use of 
        housing and community development dollars in Federal programs 
        has allowed for the perpetuation of the legacy of redlining and 
        neighborhood disinvestment.
            (12) It is imperative that the Federal Government make 
        funding available for the best local strategies to increase 
        homeownership and preserve home equity in impacted areas, 
        access to safe and affordable rental housing, economic growth, 
        job creation, and to build on local assets to improve 
        communities in ways that affirmatively further fair housing.

SEC. 3. COMPETITIVE GRANT PROGRAM.

    (a) Establishment.--Not later than the expiration of the 120-day 
period beginning on the date of the enactment of this Act, the 
Secretary of Housing and Urban Development shall establish a program to 
award competitive grants to eligible local partnerships to carry out 
more than one neighborhood revitalization support activity in an 
eligible locality.
    (b) Criteria.--
            (1) Eligible local partnership.--A local partnership is 
        eligible to receive a grant under the program established under 
        this section if it meets the following requirements:
                    (A) The local partnership includes a national or 
                local nonprofit organization with expertise in 
                community planning, engagement, organizing, 
                development, or neighborhood revitalization and at 
                least one of the following entities:
                            (i) A city or county government.
                            (ii) A land bank.
                            (iii) A fair housing enforcement 
                        organization (as such term is defined in 
                        section 561 of the Housing and Community 
                        Development Act of 1987 (42 U.S.C. 3616a)).
                            (iv) An anchor institution.
                            (v) A nonprofit organization.
                            (vi) A State housing finance agency (as 
                        such term is defined in section 106(h) of the 
                        Housing and Urban Development Act of 1968 (12 
                        U.S.C. 1701x(h))).
                            (vii) A community development financial 
                        institution (as such term is defined in section 
                        103(5) of the Community Development Banking and 
                        Financial Institutions Act of 1994 (12 U.S.C. 
                        4702(5))).
                            (viii) A public housing agency (as such 
                        term is defined in section 3(b) of the United 
                        States Housing Act of 1937 (42 U.S.C. 
                        1437a(b))).
                    (B) Such local partnership will use a grant awarded 
                under this section to carry out neighborhood 
                revitalization support activities in furtherance of a 
                neighborhood revitalization strategy for eligible 
                localities.
            (2) Eligible locality.--For the purposes of this section, 
        an eligible locality is a geographic area or areas at the 
        neighborhood or county level that meet at least four of the 
        following objective criteria of economic distress:
                    (A) Dwelling unit sales prices are lower than the 
                cost to acquire and rehabilitate, or build, a new 
                dwelling unit.
                    (B) High proportions of residential and commercial 
                properties are vacant due to foreclosure, eviction, 
                abandonment, or other causes.
                    (C) Low rates of homeownership.
                    (D) Racial disparities in homeownership rates.
                    (E) High rates of poverty.
                    (F) High rates of unemployment and underemployment.
                    (G) Population loss.
                    (H) Lack of private sector lending on fair and 
                competitive terms for individuals to purchase homes or 
                start small businesses.
                    (I) Other indicators of economic distress, such as 
                the lack of housing affordability, stemming from long-
                standing government policies and private sector 
                practices that prevented mortgage lending in some 
                communities, such as redlining.
        The Secretary shall establish thresholds for the criteria of 
        economic distress under this paragraph.
            (3) Neighborhood revitalization support activities.--For 
        purposes of this section, neighborhood revitalization support 
        activities are the following:
                    (A) Providing assistance to existing residents 
                experiencing economic distress or at risk of 
                displacement with homeowner rehabilitation assistance, 
                weatherization, improved housing accessibility and 
                livability for seniors and persons with disabilities, 
                energy efficiency improvements, refinancing, housing 
                counseling certified by the Secretary, including loss 
                mitigation counseling, property tax relief, clearing 
                and obtaining formal title, addressing outstanding 
                housing-related expenses, or other activities that the 
                Secretary determines are appropriate.
                    (B) Purchasing non-performing mortgages to assist 
                existing homeowners and advance neighborhood stability.
                    (C) Supporting the purchase and redevelopment of 
                vacant, abandoned, or distressed properties to create 
                affordable rental housing, homeownership or shared 
                equity homeownership opportunities, mixed-use 
                properties, or commercial properties. Properties 
                supported with assistance under this subparagraph may 
                be converted between rental and homeownership, 
                including shared equity homeownership, upon termination 
                of the lease or transfer of the property during the 
                relevant period of affordability to ensure local 
                community needs are met, properties do not sit vacant, 
                and affordability is preserved.
                    (D) Providing pre-purchase counseling through 
                housing counselors certified by the Secretary for 
                neighborhood revitalization support activities that 
                provide homeownership opportunities.
                    (E) Providing down payment assistance to 
                prospective homebuyers.
                    (F) Establishing and operating community land 
                trusts to provide affordable rental and homeownership 
                opportunities, including shared equity homeownership 
                opportunities.
                    (G) Demolishing abandoned or distressed structures, 
                but only if such activity is part of a strategy that 
                incorporates rehabilitation or new construction and 
                efforts to increase affordable housing and 
                homeownership, except that not more than 10 percent of 
                any grant made under this section may be used for 
                activities under this subparagraph unless the Secretary 
                determines that such use is to replace units in an 
                effort to increase affordable housing or homeownership.
                    (H) Establishing or operating land banks to 
                maintain acquire, redevelop, or sell properties that 
                are abandoned or distressed. Preference among 
                applications proposing activities under this 
                subparagraph shall be given to applications that 
                promote distribution of properties for affordable 
                housing and small businesses.
                    (I) Improving parks, sidewalks, street lighting, 
                and other neighborhood improvements that impact quality 
                of life in the targeted neighborhoods, except that not 
                more than 5 percent of any grant made under this 
                section may be used for activities under this 
                subparagraph.
                    (J) In connection with any other eligible activity 
                under this paragraph, working with resident leaders and 
                community groups to undertake community planning, 
                outreach, and neighborhood engagement, consistent with 
                the goals of increasing homeownership, stabilizing 
                neighborhoods, reducing vacancy rates, creating jobs, 
                increasing or stabilizing residential and commercial 
                property values, and meeting other neighborhood needs, 
                except that not more than 10 percent of any grant made 
                under this section may be used for activities under 
                this subparagraph.
            (4) Affordability terms.--
                    (A) Rental units.--In the case of property assisted 
                pursuant to paragraph (3) containing any dwelling units 
                that are made available for rental--
                            (i) such units shall be available for 
                        rental only by a household having an income 
                        that does not exceed 60 percent of the median 
                        income for the area in which such unit is 
                        located;
                            (ii) such units shall remain affordable for 
                        at least 30 years;
                            (iii) such property may be a mixed-use 
                        property; and
                            (iv) such unit shall be maintained in 
                        habitable condition, as defined by the locality 
                        in which the property is located.
                    (B) Homeownership units.--In the case of property 
                assisted pursuant to paragraph (3) consisting of a 
                dwelling unit, or containing any dwelling units, made 
                available for homeownership, such unit or units--
                            (i) shall be available for purchase only to 
                        by a household having an income that does not 
                        exceed 120 percent of the median income for the 
                        area in which such unit is located;
                            (ii) if made available through a shared 
                        equity homeownership program, shall remain 
                        affordable for at least 30 years; and
                            (iii) if not made available through a 
                        shared equity homeownership program--
                                    (I) shall remain affordable for a 
                                period of years as determined by the 
                                partnership, which shall not be shorter 
                                than 5 years from the sale of the unit; 
                                and
                                    (II) shall be subject to resale or 
                                recapture provisions that--
                                            (aa) are established by the 
                                        partnership to ensure that the 
                                        affordability term may be met 
                                        or funds may be redeployed for 
                                        neighborhood revitalization 
                                        support activities;
                                            (bb) may be waived in cases 
                                        of hardship or market 
                                        depreciation; and
                                            (cc) provide that, in the 
                                        case of a resale, the 
                                        partnership may maintain 
                                        preemptive purchase options in 
                                        order to sell the property to 
                                        another income qualified 
                                        purchaser.
         If a property converts between rental and homeownership or 
        shared equity homeownership, the affordability terms of the new 
        tenure type shall be utilized upon occupancy.
    (c) Applications.--
            (1) In general.--To apply to receive a grant under this 
        section, an eligible local partnership shall submit to the 
        Secretary an application at such time, in such manner, and 
        containing such information as the Secretary may require.
            (2) Grant recipient priority selection criteria.--The 
        Secretary shall prioritize awarding grants based on the 
        following criteria:
                    (A) The severity of the locality's indicators of 
                distress under subsection (b)(2).
                    (B) The extent to which the activities proposed 
                will--
                            (i) in the case of rental housing, benefit 
                        households having incomes not exceeding 30 
                        percent of the median income for the area; and
                            (ii) in the case of homeownership housing, 
                        including shared equity homeownership, benefit 
                        households having incomes not exceeding 80 
                        percent of the median income for the area.
                    (C) Whether the activities proposed will promote 
                affordable homeownership and the extent to which such 
                affordability terms will be preserved.
                    (D) The extent to which an eligible partnership 
                that includes a public housing agency will use housing 
                choice vouchers to support homeownership for households 
                at or below 60 percent of area median income.
                    (E) The demonstrated capacity of an eligible local 
                partnership to execute the proposed eligible 
                neighborhood revitalization support activities.
                    (F) The demonstrated community planning, outreach, 
                and engagement practices of an eligible local 
                partnership.
                    (G) The depth and breadth of the community 
                partnership supporting the application.
                    (H) The extent to which existing residents are 
                assisted to prevent displacement.
                    (I) The extent to which the proposed neighborhood 
                revitalization support activities would help close the 
                racial wealth gap by increasing minority homeownership, 
                ensuring equitable access to housing and economic 
                opportunity, and countering the ongoing legacy of 
                redlining policies.
                    (J) The extent to which development of new units 
                are water and energy efficient.
                    (K) The feasibility of the proposed neighborhood 
                revitalization support activities considering local 
                market conditions.
                    (L) The extent to which an application demonstrates 
                comprehensive community planning efforts and additional 
                funds in hand or committed for activities in the 
                geographic area that are not directly related to the 
                provision of affordable housing, such as support for 
                small, minority, and women-owned business activity in 
                commercial zones in the targeted neighborhoods.
            (3) Geographical diversity.--The Secretary shall seek to 
        make grants under this section for local partnerships serving 
        geographically diverse areas of economic distress as defined in 
        subsection (b)(2), including metropolitan and underserved rural 
        areas.
    (d) Operation Costs.--Up to 15 percent of the amount of each grant 
under this section may be used by the recipient for administrative and 
organizational support costs.
    (e) Technical Assistance and Capacity Building.--The Secretary may 
reserve up to 1 percent of any funds appropriated to carry out this 
section for technical assistance activities which support grantees 
under this program and 1 percent of funds from each grant awarded shall 
be used to develop grantee capacity to meet the requirements under 
paragraphs (1) and (2) of subsection (g).
    (f) Fair Housing Protections.--Funds provided under the program 
under this section may not be used to deny housing opportunities based 
on the criminal or eviction history, source of income, or veteran 
status of any member of a household.
    (g) Accountability of Recipients.--
            (1) Requirements.--The Secretary shall--
                    (A) require each grantee under this section to 
                develop and maintain a system to ensure that each 
                recipient of assistance uses such amounts in accordance 
                with this section, the regulations issued under this 
                section, and any requirements or conditions under which 
                such amounts were provided; and
                    (B) establish minimum requirements for agreements 
                between the grantee and the Secretary, regarding 
                assistance from grants under this section, which shall 
                include--
                            (i) appropriate periodic financial and 
                        project reporting, record retention, and audit 
                        requirements for the duration of the grant to 
                        the recipient to ensure compliance with the 
                        limitations and requirements of this section 
                        and the regulations under this section; and
                            (ii) any other requirements that the 
                        Secretary determines are necessary to ensure 
                        appropriate grant administration and 
                        compliance.
            (2) Publicly available information.--The Secretary shall 
        make information regarding the results of assistance provided 
        with amounts from grants under this section publicly available, 
        which shall include at least the following information:
                    (A) A list of recipients of grants awarded under 
                this section and the amount of each such grant.
                    (B) A description of each neighborhood 
                revitalization support activity carried out by each 
                such recipient and the impacts associated with each 
                such activity, including the change in the rate of 
                minority and first-time homeownership.
                    (C) The total number of housing units acquired, 
                redeveloped, or produced using grant amounts under this 
                section.
                    (D) The total number of housing units for rent, 
                ownership, and shared equity homeownership assisted 
                with grant amounts under this section and the number of 
                bedrooms in each such unit.
                    (E) The percentage of housing units assisted with 
                grant amounts under this section that are affordable to 
                low-, very low-, and extremely low-income households.
                    (F) The number of such housing units located in 
                areas where the percentage of households in a racial or 
                ethnic minority group--
                            (i) is at least 20 percentage points higher 
                        than the percentage of the population of that 
                        minority group for the Metropolitan Statistical 
                        Area;
                            (ii) is at least 20 percentage points 
                        higher than the percentage of the population of 
                        all minorities for the Metropolitan Statistical 
                        Area; and
                            (iii) exceeds 50 percent of the population.
                    (G) Any other information that the Secretary of 
                Housing and Urban Development determines necessary to 
                ensure that housing outcomes and grant administration 
                and compliance align with the purposes of this Act.
    (h) In General.--Not later than 2 years after grants under this 
section are first awarded and again 3 years thereafter, the Secretary 
shall submit to the appropriate Congressional Committees, and make 
publicly available online, a report that--
            (1) evaluates the impact of the program established under 
        this section;
            (2) describes demographic changes in the eligible 
        localities served by grantees of grants under this section, 
        including changes in income, race, and ethnicity, property 
        values, and unemployment rates;
            (3) identifies the number of housing units assisted with 
        grant amounts under this section located in high- and low-
        poverty census tracts;
            (4) identifies the number of accessible units created and 
        modified with grant amounts under this section and where such 
        units are located using the most granular location measurement 
        that is feasible such as at the Census block group level; and
            (5) identifies where housing units assisted with grant 
        amounts are located in relation to community assets, including 
        high performing schools and public transportation options.
    (i) Definitions.--In this section:
            (1) Anchor institution.--The term ``anchor institution'' 
        means a school, a library, a healthcare provider, a community 
        college or other institution of higher education, or another 
        community support organization or entity.
            (2) Appropriate congressional committees.--The term 
        ``appropriate Congressional Committees'' means the following:
                    (A) The Committees on Financial Services and 
                Appropriations of the House of Representatives.
                    (B) The Committees on Banking, Housing, and Urban 
                Affairs and Appropriations of the Senate.
            (3) Community land trust.--The term ``community land 
        trust''' means a nonprofit organization or State or local 
        governments or instrumentalities that--
                    (A) use a ground lease or deed covenant with an 
                affordability period of at least 30 years or more to--
                            (i) make rental and homeownership units 
                        affordable to households; and
                            (ii) stipulate a preemptive option to 
                        purchase the affordable rentals or 
                        homeownership units so that the affordability 
                        of the units is preserved for successive 
                        income-eligible households; and
                    (B) monitor properties to ensure affordability is 
                preserved.
            (4) Land bank.--The term ``land bank'' means a government 
        entity, agency, or program, or a special purpose nonprofit 
        entity formed by one or more units of government in accordance 
        with State or local land bank enabling law, that has been 
        designated by one or more State or local governments to 
        acquire, steward, and dispose of vacant, abandoned, or other 
        problem properties in accordance with locally-determined 
        priorities and goals.
            (5) Neighborhood revitalization support activity.--The term 
        ``neighborhood revitalization support activity'' means an 
        activity described in subsection (b)(3).
            (6) Non-performing mortgage.--The term ``non-performing'' 
        mortgage means a residential mortgage loan that is 90 days or 
        more delinquent.
            (7) Nonprofit organization.--The term ``nonprofit 
        organization'' means an organization that is described in 
        section 501(c)(3) of the Internal Revenue Code of 1986 (26 
        U.S.C. 501(c)(3)) and is exempt from taxation under section 
        501(a) of such Code.
            (8) Shared equity homeownership program.--
                    (A) In general.--The term ``shared equity 
                homeownership program'' means affordable homeownership 
                preservation through a resale restriction program 
                administered by a community land trust, other nonprofit 
                organization, or State or local government or 
                instrumentalities.
                    (B) Affordability requirements.--Any such program 
                under subparagraph (A) shall--
                            (i) provide affordable homeownership 
                        opportunities to households; and
                            (ii) utilize a ground lease, deed 
                        restriction, subordinate loan, or similar legal 
                        mechanism that includes provisions ensuring 
                        that the program shall--
                                    (I) maintain the home as affordable 
                                for subsequent very low-, low-, or 
                                moderate-income families for an 
                                affordability term of at least 30 years 
                                after recordation;
                                    (II) apply a resale formula that 
                                limits the homeowner's proceeds upon 
                                resale; and
                                    (III) provide the program 
                                administrator or such administrator's 
                                assignee a preemptive option to 
                                purchase the homeownership unit from 
                                the homeowner at resale.
    (j) Authorization of Appropriations.--
            (1) In general.--There is authorized to be appropriated to 
        carry out this section $5,000,000,000 for each of fiscal years 
        2021 through 2031.
            (2) Set aside.--The Secretary shall award at least 
        $500,000,000 of any amounts appropriated pursuant to this 
        subsection to eligible local partnerships that will provide 
        neighborhood revitalization support activities to localities 
        outside of a Metropolitan Statistical Area, as designated by 
        the Office of Management and Budget. The priority under 
        subsection (c)(2)(I) (relating to matching funds) shall not 
        apply to amounts awarded under this paragraph.
            (3) NOFA.--The Secretary shall issue a Notice of Funding 
        Availability for grants under this section not later than the 
        expiration of the 180-day period beginning upon the date of the 
        enactment of this Act.

SEC. 4. SELF-HELP HOMEOWNERSHIP OPPORTUNITY PROGRAM.

    There is authorized to be appropriated for grants under section 11 
of the Housing Opportunity Program Extension Act of 1996 (42 U.S.C. 
12805 note) $250,000,000 for fiscal year 2021, which shall remain 
available until September 30, 2031.
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