II 119th CONGRESS 1st Session S. 934 IN THE SENATE OF THE UNITED STATES March 11 (legislative day, March 10), 2025 Ms. Warren (for herself, Mr. Warnock , Mr. Markey , Mr. Sanders , Ms. Hirono , Mr. Welch , Mr. Blumenthal , Mr. Van Hollen , and Mr. Kim ) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To make housing more affordable, and for other purposes.

1. Short title; table of contents (a) Short title This Act may be cited as the American Housing and Economic Mobility Act of 2025 . (b) Table of contents The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. TITLE I—Making housing more affordable Sec. 101. Local housing innovation grants. Sec. 102. Investing in affordable housing infrastructure. Sec. 103. Conditions for the sale of real estate-owned properties and non-performing loans. TITLE II—Taking the first steps to reverse the legacy of housing discrimination and government negligence Sec. 201. Down payment assistance program for first-time, first-generation homebuyers. Sec. 202. Formula grant program for communities with an appraisal gap. Sec. 203. Strengthening the Community Reinvestment Act of 1977. Sec. 204. Amendments relating to credit union service to underserved areas. Sec. 205. Raising public welfare caps. Sec. 206. Temporary eligibility of certain direct descendants of certain veterans for housing loans guaranteed by the Secretary of Veterans Affairs. TITLE III—Removing barriers that isolate communities Sec. 301. Expanding rights under the Fair Housing Act. Sec. 302. Improving outcomes in housing assistance programs. TITLE IV—Estate tax reform Sec. 401. Amendment to Internal Revenue Code of 1986. Sec. 402. Rate adjustment. Sec. 403. Required minimum 10-year term, etc., for grantor retained annuity trusts. Sec. 404. Certain transfer tax rules applicable to grantor trusts. Sec. 405. Elimination of generation-skipping transfer tax exemption for transfers to certain persons. Sec. 406. Simplifying gift tax exclusion for annual gifts. Sec. 407. Clarification regarding disallowance of step-up in basis for property held in certain grantor trusts. Sec. 408. Limitation on discounts; valuation rules for certain transfers of nonbusiness assets. Sec. 409. Surcharge on high income estates and trusts. Sec. 410. Modification of rules for value of certain farm, etc., real property. Sec. 411. Modification of estate tax rules with respect to land subject to conservation easements. TITLE V—Accessibility requirements Sec. 501. Accessibility requirements. I Making housing more affordable 101. Local housing innovation grants (a) Definitions In this section: (1) Elementary school; secondary school The terms elementary school and secondary school have the meanings given those terms in section 8101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7801 ). (2) Eligible entity The term eligible entity means— (A) a State; (B) a unit of general local government; or (C) an Indian tribe. (3) Indian tribe The term Indian tribe has the meaning given the term in section 4 of the Native American Housing Assistance and Self-Determination Act of 1996 ( 25 U.S.C. 4103 ). (4) Institution of higher education The term institution of higher education has the meaning given the term in section 101 of the Higher Education Act of 1965 ( 20 U.S.C. 1001 ). (5) Metropolitan area; State; unit of general local government The terms metropolitan area , State , and unit of general local government have the meanings given those terms in section 102 of the Housing and Community Development Act of 1974 ( 42 U.S.C. 5302 ). (6) Secretary The term Secretary means the Secretary of Housing and Urban Development. (b) Establishment Not later than 1 year after the date of enactment of this Act, the Secretary shall establish a program to award grants on a competitive basis to eligible entities to— (1) reform local land use restrictions to bring down the costs of producing affordable housing; and (2) remove unnecessary barriers to building affordable units in their communities. (c) Eligible activities An eligible entity receiving a grant under this section may use funds to— (1) carry out any of the activities described in section 105 of the Housing and Community Development Act of 1974 ( 42 U.S.C. 5305 ); (2) carry out any of the activities permitted under the Local and Regional Project Assistance Program under section 6702 of title 49, United States Code; or (3) modernize, renovate, or repair facilities used by public elementary schools, public secondary schools, and public institutions of higher education, including modernization, renovation, and repairs that— (A) promote physical, sensory, and environmental accessibility; and (B) are consistent with a recognized green building rating system. (d) Application (1) In general An eligible entity desiring a grant under this section shall submit to the Secretary an application that demonstrates that the eligible entity has carried out, or is in the process of carrying out, initiatives that facilitate the expansion of the supply of well-located affordable housing. (2) Activities Initiatives that meet the criteria described in paragraph (1)— (A) include— (i) establishing by-right development, which allows jurisdictions to administratively approve new developments that are consistent with their zoning code; (ii) revising or eliminating off-street parking requirements to reduce the cost of housing production; (iii) instituting measures that incentivize owners of vacant land to redevelop the space into affordable housing or other productive uses; (iv) revising minimum lot size requirements and bans or limits on multifamily construction to allow for denser and more affordable development; (v) instituting incentives to promote dense development, such as density bonuses; (vi) passing inclusionary zoning ordinances that require a portion of newly developed units to be reserved for low- and moderate-income renters or homebuyers; (vii) streamlining regulatory requirements and shortening processes, reforming zoning codes, or other initiatives that reduce barriers to housing supply elasticity and affordability; (viii) allowing accessory dwelling units; (ix) using local tax incentives to promote development of affordable housing; and (x) implementing measures that protect tenants from harassment and displacement, including— (I) providing access to counsel for tenants facing eviction; (II) the prohibition of eviction except for just cause; (III) measures intended to prevent or mitigate sudden increases in rents; (IV) the repeal of laws that prevent localities from implementing a measure described in subclause (I), (II), or (III); (V) protections against constructive eviction; (VI) tenant right-to-organize laws; (VII) a cause of action for tenants to sue landlords who threaten or begin an illegal eviction; and (VIII) landlord-tenant mediation or other non-eviction diversion programs; and (B) do not include activities that alter ordinances that govern wage and hour laws, family and medical leave laws, health and safety requirements, prevailing wage laws, or protections for workers' health and safety, anti-discrimination, and right to organize. (3) Relation to consolidated plan An eligible entity shall include in an application submitted under paragraph (1) a description of how the planning and development of eligible activities described in subsection (c) may advance an objective, or an aspect of an objective, included in the comprehensive housing affordability strategy and community development plan of the eligible entity under part 91 of title 24, Code of Federal Regulations, or any successor regulation (commonly referred to as a consolidated plan ). (e) Labor laws (1) In general All laborers and mechanics employed by contractors or subcontractors in the performance of construction work financed in whole or in part with a grant received under this section shall be paid wages at rates not less than those prevailing on similar construction in the locality, as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code (commonly known as the Davis-Bacon Act ). (2) Authority and functions With respect to the labor standards specified in paragraph (1), the Secretary of Labor shall have the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, United States Code. (f) Authorization of appropriations There is authorized to be appropriated to carry out this section $2,000,000,000 for each of fiscal years 2025 through 2029. 102. Investing in affordable housing infrastructure (a) Housing Trust Fund Section 1338(a) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 ( 12 U.S.C. 4568(a) ) is amended by adding at the end the following: (3) Authorization of appropriations There is authorized to be appropriated to the Housing Trust Fund $48,000,000,000 for each of fiscal years 2025 through 2034. . (b) Capital Magnet Fund Section 1339 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 ( 12 U.S.C. 4569 ) is amended by adding at the end the following: (k) Authorization of appropriations There is authorized to be appropriated to the Capital Magnet Fund $3,000,000,000 for each of fiscal years 2025 through 2034. . (c) Public housing capital fund Section 9(c)(2)(A) of the United States Housing Act of 1937 ( 42 U.S.C. 1437g(c)(2)(A) ) is amended to read as follows: (A) Capital fund For allocations of assistance from the Capital Fund, $70,000,000,000 for fiscal year 2025. . (d) Indian housing block grant program Section 108 of the Native American Housing Assistance and Self-Determination Act of 1996 ( 25 U.S.C. 4117 ) is amended— (1) by striking such sums as may be necessary for each of fiscal years 2009 through 2013 and inserting $2,500,000,000 for fiscal year 2025 and such sums as may be necessary for each of fiscal years 2026 through 2034 ; and (2) by striking the second sentence. (e) Native Hawaiian housing block grant program Section 824 of the Native American Housing Assistance and Self-Determination Act of 1996 ( 25 U.S.C. 4243 ) is amended by striking such sums as may be necessary for each of fiscal years 2001, 2002, 2003, 2004, and 2005 and inserting $50,000,000 for fiscal year 2025 and such sums as may be necessary for each of fiscal years 2026 through 2034 . (f) Rural housing programs Out of funds in the Treasury not otherwise appropriated, there is appropriated for fiscal year 2025— (1) to provide direct loans under section 502 of the Housing Act of 1949 ( 42 U.S.C. 1472 ), $420,000,000; (2) to provide assistance under section 514 of such Act ( 42 U.S.C. 1484 ), $54,000,000; (3) to provide assistance under section 515 of such Act ( 42 U.S.C. 1485 ), $420,000,000; (4) to provide assistance under section 516 of such Act ( 42 U.S.C. 1486 ), $75,000,000; (5) to provide grants under section 523 of such Act ( 42 U.S.C. 1490c ), $75,000,000; and (6) to provide funding to carry out the Multifamily Preservation and Revitalization Demonstration Program of the Rural Housing Service (as authorized under sections 514, 515, and 516 of such Act ( 42 U.S.C. 1484 , 1485, 1486)), $240,000,000. (g) Middle Class Housing Emergency Fund (1) Definitions In this subsection— (A) the term affordable rental housing unit means a unit for which monthly rent is not more than 30 percent of the monthly area median income; and (B) the term State has the meaning given the term in section 3(b)(7) of the United States Housing Act of 1937 ( 42 U.S.C. 1437a(b)(7) ). (2) Establishment The Secretary of Housing and Urban Development shall establish and manage a fund, to be known as the Middle Class Housing Emergency Fund , which shall be funded with any amounts as may be appropriated, transferred, or credited to the Fund under any provision law. (3) Grants From amounts available in the fund established under paragraph (2), the Secretary of Housing and Urban Development shall award grants on a competitive basis to State housing finance agencies located in a State in which— (A) there is a shortage of affordable rental housing units available to individuals with an income that is at or below the area median income and median rents have risen on average over the preceding 5 years substantially faster than the area median income; or (B) there is a shortage of housing units available for sale that are affordable to individuals with an income that is at or below the area median income and median home prices have risen on average over the preceding 5 years substantially faster than the area median income. (4) Use of funds Grants received under this subsection shall be used to fund— (A) the construction or acquisition, by nonprofit organizations, State or local agencies, special-purpose units of local government, resident councils organized to acquire housing, and other qualified purchasers (as defined by the Secretary of Housing and Urban Development), of rental housing units or units for purchase that are affordable to residents making less than 120 percent of the area median income; and (B) measures to prevent tenant displacement and harassment, including— (i) the provision of legal advice and representation for tenants facing eviction; (ii) enforcement of anti-harassment laws; (iii) emergency rental assistance; and (iv) other measures as specified by the Secretary of Housing and Urban Development. (5) Labor laws (A) In general All laborers and mechanics employed by contractors or subcontractors in the performance of construction work financed in whole or in part with a grant received under this subsection shall be paid wages at rates not less than those prevailing on similar construction in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code (commonly known as the Davis-Bacon Act ). (B) Authority and functions With respect to the labor standards specified in subparagraph (A), the Secretary of Labor shall have the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, United States Code. (6) Regulations The Secretary of Housing and Urban Development shall promulgate regulations to carry out this subsection that include— (A) the metrics that the Secretary will use to determine eligibility for a grant under this subsection; (B) a requirement that grantees and subgrantees consult with impacted communities in policymaking and planning for the construction or acquisition of housing units as described in paragraph (4)(A); and (C) a requirement that all housing units constructed or acquired using grants awarded under the subsection are affordable to residents making less than 120 percent of the area median income in perpetuity. (7) Appropriations Out of funds in the Treasury not otherwise appropriated, there is appropriated to the fund established under this subsection $4,000,000,000 for fiscal year 2025. 103. Conditions for the sale of real estate-owned properties and non-performing loans (a) Findings Congress finds that— (1) the Federal Housing Administration, the Federal National Mortgage Association, and the Federal Home Loan Mortgage Corporation provide critical homeownership opportunities that greatly benefit individuals, families, and communities; and (2) it is the purpose of this section to— (A) preserve owner-occupied homes with mortgages insured by the Federal Housing Administration or purchased by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation for continued use as owner-occupied homes; and (B) direct that, upon the sale of those properties or transfer of those mortgages, certain percentages of those properties are sold to low- and moderate-income homeowners. (b) Loans insured by the Federal Housing Administration Title II of the National Housing Act ( 12 U.S.C. 1707 et seq. ) is amended by adding at the end the following: 259. Sale of real estate-owned properties (a) Definitions In this section— (1) the term Claim Without Conveyance of Title program means the program of the Federal Housing Administration carried out under section 203.368 of title 24, Code of Federal Regulations, or any successor regulation; and (2) the term community partner has the meaning given the term nonprofit organization in section 229 of the Low-Income Housing Preservation and Resident Homeownership Act of 1990 ( 12 U.S.C. 4119 ). (b) Requirement Not later than 1 year after the date of enactment of this section, the Secretary shall develop programs within the Federal Housing Administration to ensure that not less than 75 percent of the single-family residential properties conveyed to the Federal Housing Administration after foreclosure or conveyed to third parties under the Claim Without Conveyance of Title program are sold— (1) directly to an owner-occupant; or (2) to community partners that will— (A) rehabilitate or develop the property; and (B) sell the property to an owner-occupant. (c) Guidelines Not later than 1 year after the date of enactment of this section, the Secretary shall develop guidelines for the Claim Without Conveyance of Title program that provide an exclusive listing period during which only eligible governmental entities, nonprofit organizations approved by the Department of Housing and Urban Development, and owner-occupant buyers may submit bids. (d) Anti-Predatory feature Unless the Secretary provides prior approval, the Secretary shall prohibit any purchaser of a real estate-owned property of the Federal Housing Administration from reselling the property within 15 years of purchase using a land installment contract or through any other mechanism that does not transfer title to the buyer at the time of sale. 260. Sale of non-performing loans (a) Definitions In this section— (1) the term community partner has the meaning given the term in section 259; and (2) the term covered mortgage — (A) means any mortgage insured under this title that is secured by a single-family residential property; and (B) includes the promissory note secured by the mortgage described in subparagraph (A). (b) Restriction on sale or transfer Except as provided in this section, the Secretary may not sell or transfer any covered mortgage. (c) Conditions for sale or transfer (1) In general The Secretary— (A) may sell or transfer a covered mortgage only if— (i) the capital level of the Fund is substantially below the capital ratio required under section 205(f)(2); (ii) the Secretary certifies that other reasonable measures are not available to restore the Fund to that capital ratio; and (iii) the Secretary complies with paragraph (2)(C), if applicable; and (B) may sell or transfer only such covered mortgages as are necessary to assist in restoration of that capital ratio. (2) Requirements for the Secretary (A) In general If the Secretary intends to sell or transfer a covered mortgage, the Secretary shall provide the current borrower and all owners of record of the property securing the covered mortgage, or require that the current borrower and owners of record be provided, a separate written notice of the intent to sell the covered mortgage that— (i) is mailed via certified and first class mail not less than 90 days before the date on which the loan is included in any proposed sale; and (ii) includes— (I) a description of the loss mitigation options of the Federal Housing Administration that are available to borrowers in financial distress and the obligation of servicers to consider borrowers in default for those options; (II) a description of the actions that the servicer of the loan has taken to review and implement those options for the borrower; and (III) a description of the procedures the borrower may use to contest with the Secretary the compliance by the servicer with that obligation. (B) Judicial review The determination of the Secretary to authorize the sale of a mortgage insured under this title shall be reviewable under chapter 7 of title 5, United States Code, for abuse of discretion and arbitrary and capricious agency action. (C) Auctions The Secretary may not sell any covered mortgage through any type of non-performing loan sale auction program until the Secretary issues rules, through the notice and comment rulemaking procedures under section 553 of title 5, United States Code, that address essential aspects of any non-performing loan sale program, including— (i) the method of selection of loans for sale; (ii) notice to borrowers prior to inclusion of the loan in a sale; and (iii) review of loss mitigation status prior to the sale, selection of eligible bidders, loss mitigation guidelines applicable to loan purchasers, and reporting requirements for purchasers. (3) Certification requirement for lenders and servicers (A) Certification As a condition to payment of an insurance claim under this title in connection with any non-performing loan sale, the lender or servicer of the loan shall provide the Secretary and the borrower with written certification of the loss mitigation review contained in the FHA Single Family Housing Policy Handbook 4000.1, or any successor handbook, which certification shall include a description of the actions the lender or servicer has taken, prior to transfer of the loan to the Secretary, to— (i) review the borrower for all available loss mitigation options of the Federal Housing Administration; and (ii) implement the options described in clause (i) that are appropriate to the borrower. (B) False statements (i) In general Any false statement provided in a certification described in subparagraph (A) shall be a basis for— (I) recovery by the Secretary of any amounts paid under the insurance claim and any other penalties and sanctions authorized under Federal law; and (II) a private right of action by the borrower against the lender and servicer, with remedies to include compensatory and punitive damages and an assessment of costs and attorney's fees. (ii) Transfers Unless a bona fide purchaser has acquired title to the property as a primary residence— (I) a certification described in subparagraph (A) that contains a false statement shall be a basis for revoking the transfer of the property; and (II) the pre-sale lender and servicer of the property shall— (aa) resume servicing the loan as a loan insured under this title; and (bb) reimburse the Secretary for any insurance claim paid and all costs related to the sale of the property. (4) Requirements for purchasers (A) In general Each purchaser of a covered mortgage shall offer the borrower on the covered mortgage loss mitigation options that allow for payment reduction at least as great as would be available to the borrower if the loan had not been sold. (B) Loss mitigation options The specific formula, calculations, waterfall steps, and other terms for appropriate loss mitigation options described in subparagraph (A) shall be published by the Secretary, made available to the public, and included in a written notice given to borrowers before any acceleration or foreclosure is initiated after a loan sale. (5) Requirements for transferees With respect to a transferee, including any subsequent transferee, of a covered mortgage that is sold under this title— (A) the transferee shall certify in writing to the Secretary that the transferee will comply with the provisions of this section in the marketing and transfer of any property received in the disposition of any transferred loan; (B) the transferee shall provide to the Secretary records documenting that the transfers of those properties are in compliance with this section; and (C) the failure of the Secretary or the transferee to comply with the requirements under this section for a loan in default shall be a defense to foreclosure, and a transferee may not execute a foreclosure judgment or order of sale, or conduct a foreclosure sale, until the transferee has complied with all requirements under this section. (d) Limitations With respect to covered mortgages that are sold under this title and acquired by the buyer through foreclosure sale, not less than 90 percent of the properties that are the subject of the covered mortgages shall be— (1) sold to owner-occupants; (2) operated or transferred to an entity that will operate the property as affordable rental housing for households below 80 percent of the area median income for a period of not less than 15 years; or (3) transferred or donated to a nonprofit agency that is certified by the Secretary and will redevelop the property for owner occupancy or affordable rental housing. (e) Prioritization of sales The Secretary shall implement policies, procedures, and controls to— (1) identify and recruit community partners; (2) engage in consultations with community partners before the sale of a pool of covered mortgages under this title to determine whether that sale can be designed to meet the specific needs of the communities served by the community partners; and (3) prioritize the sale of pools of single-family mortgages to community partners by— (A) designing pools of covered mortgages for direct sale to a community partner, the price of which shall be set by the Secretary based on a pricing model that considers— (i) the current fair market value of the properties; and (ii) the potential impact of foreclosures on those properties to the value of other homes that secure mortgages insured under this title in the same census tract; or (B) in the case of an auction, if the winning bid is not from a community partner, permitting any community partner that bid during that same auction to have a final opportunity to enter a higher bid on the pool. . (c) Fannie Mae Section 302 of the Federal National Mortgage Association Charter Act ( 12 U.S.C. 1717 ) is amended by adding at the end the following: (d) (1) In this subsection, the term covered mortgage — (A) means any mortgage that is secured by a single-family residential property; and (B) includes the promissory note secured by the mortgage described in subparagraph (A). (2) The corporation may not sell or transfer any covered mortgage under this section unless the requirements of this subsection are met. (3) (A) If the corporation intends to sell or transfer a covered mortgage, the corporation shall provide the current borrower and all owners of record of the property securing the covered mortgage, or require that the current borrower and owners of record be provided, a separate written notice of the intent to sell the covered mortgage that— (i) is mailed via certified and first class mail not less than 90 days before the date on which the loan is included in any proposed sale; and (ii) includes— (I) a description of the loss mitigation options of the corporation that are available to borrowers in financial distress and the obligation of servicers to consider borrowers in default for those options; (II) a description of the actions that the servicer of the loan has taken to review and implement those options for the borrower; and (III) a description of the procedures the borrower may use to contest with the corporation the compliance by the servicer with that obligation. (B) The Federal Housing Finance Agency, as receiver for the corporation, may not authorize the corporation to sell any covered mortgage through any type of non-performing loan sale auction program until the Director of the Federal Housing Finance Agency issues rules, through the notice and comment rule making procedures under section 553 of title 5, United States Code, that address essential aspects of any non-performing loan sale program, including— (i) the method of selection of loans for sale; (ii) notice to borrowers prior to inclusion of the loan in a sale; and (iii) review of loss mitigation status prior to the sale, selection of eligible bidders, loss mitigation guidelines applicable to loan purchasers, and reporting requirements for purchasers. (4) (A) Each purchaser of a covered mortgage shall offer the borrower on the covered mortgage loss mitigation options that allow for payment reduction at least as great as would be available to the borrower if the loan had not been sold. (B) The specific formula, calculations, waterfall steps, and other terms for loss mitigation options described in subparagraph (A) shall be published by the corporation, made available to the public, and included in a written notice given to borrowers before any acceleration or foreclosure is initiated after a loan sale. (5) With respect to a transferee, including any subsequent transferee, of a covered mortgage that is sold by the corporation under this section— (A) the transferee shall certify in writing to the corporation that the transferee will comply with the provisions of this subsection in the marketing and transfer of any property received in the disposition of any transferred loan; (B) the transferee shall provide to the corporation records documenting that the transfers of those properties are in compliance with this subsection; and (C) the failure of the corporation or the transferee to comply with the requirements under this subsection for a loan in default shall be a defense to foreclosure, and a transferee may not execute a foreclosure judgment or order of sale, or conduct a foreclosure sale, until the transferee has complied with all requirements under this subsection. (6) With respect to covered mortgages that are sold by the corporation under this section and foreclosed upon by the buyer, not less than 90 percent of the properties that are the subject of the covered mortgages in an auction shall be— (A) sold to owner-occupants; (B) operated or transferred to an entity that will operate the property as affordable rental housing for households below 80 percent of the area median income for a period of not less than 15 years; or (C) transferred or donated to a nonprofit agency that is certified by the corporation and will redevelop the property for owner occupancy or affordable rental housing. (7) The corporation shall implement policies, procedures, and controls to— (A) identify and recruit community partners; (B) engage in consultations with community partners before the sale of a pool of covered mortgages under this section to determine whether that sale can be designed to meet the specific needs of the communities served by the community partners; and (C) prioritize the sale of pools of single-family mortgages to community partners by— (i) designing pools of covered mortgages for direct sale to a community partner, the price of which shall be set by the corporation based on a pricing model that considers— (I) the current fair market value of the properties; and (II) the potential impact of foreclosures on those properties to the value of other homes in the same census tract; or (ii) in the case of an auction, if the winning bid is not from a community partner, permitting any community partner that bid during that same auction to have a final opportunity to enter a higher bid on the pool. . (d) Freddie Mac Section 305 of the Federal Home Loan Mortgage Corporation Act ( 12 U.S.C. 1454 ) is amended by adding at the end the following: (e) (1) In this subsection, the term covered mortgage — (A) means any mortgage that is secured by a single-family residential property; and (B) includes the promissory note secured by the mortgage described in subparagraph (A). (2) The Corporation may not sell or transfer any covered mortgage under this section unless the requirements of this subsection are met. (3) (A) If the Corporation intends to sell or transfer a covered mortgage, the Corporation shall provide the current borrower and all owners of record of the property securing the covered mortgage, or require that the current borrower and owners of record be provided, a separate written notice of the intent to sell the covered mortgage that— (i) is mailed via certified and first class mail not less than 90 days before the date on which the loan is included in any proposed sale; and (ii) includes— (I) a description of the loss mitigation options of the Corporation that are available to borrowers in financial distress and the obligation of servicers to consider borrowers in default for those options; (II) a description of the actions that the servicer of the loan has taken to review and implement those options for the borrower; and (III) a description of the procedures the borrower may use to contest with the Corporation the compliance by the servicer with that obligation. (B) The Federal Housing Finance Agency, as receiver for the Corporation, may not sell any covered mortgage through any type of non-performing loan sale auction program until the Director of the Federal Housing Finance Agency issues rules, through the notice and comment rulemaking procedures under section 553 of title 5, United States Code, that address essential aspects of any non-performing loan sale program, including— (i) the method of selection of loans for sale; (ii) notice to borrowers prior to inclusion of the loan in a sale; and (iii) review of loss mitigation status prior to the sale, selection of eligible bidders, loss mitigation guidelines applicable to loan purchasers, and reporting requirements for purchasers. (4) (A) Each purchaser of a covered mortgage shall offer the borrower on the covered mortgage loss mitigation options that allow for payment reduction at least as great as would be available to the borrower if the loan had not been sold. (B) The specific formula, calculations, waterfall steps, and other terms for loss mitigation options described in subparagraph (A) shall be published by the Corporation, made available to the public, and included in a written notice given to borrowers before any acceleration or foreclosure is initiated after a loan sale. (5) With respect to a transferee, including any subsequent transferee, of a covered mortgage that is sold by the Corporation under this section— (A) the transferee shall certify in writing to the Corporation that the transferee will comply with the provisions of this subsection in the marketing and transfer of any property received in the disposition of any transferred loan; (B) the transferee shall provide to the Corporation records documenting that the transfers of those properties are in compliance with this subsection; and (C) the failure of the Corporation or the transferee to comply with the requirements under this subsection for a loan in default shall be a defense to foreclosure, and a transferee may not execute a foreclosure judgment or order of sale, or conduct a foreclosure sale, until the transferee has complied with all requirements under this subsection. (6) With respect to covered mortgages that are sold by the Corporation under this section and foreclosed upon by the buyer, not less than 90 percent of the properties that are the subject of the covered mortgages in an auction shall be— (A) sold to owner-occupants; (B) operated or transferred to an entity that will operate the property as affordable rental housing for households below 80 percent of the area median income for a period of not less than 15 years; or (C) transferred or donated to a nonprofit agency that is certified by the Corporation and will redevelop the property for owner occupancy or affordable rental housing. (7) The Corporation shall implement policies, procedures, and controls to— (A) identify and recruit community partners; (B) engage in consultations with community partners before the sale of a pool of covered mortgages under this section to determine whether that sale can be designed to meet the specific needs of the communities served by the community partners; and (C) prioritize the sale of pools of single-family mortgages to community partners by— (i) designing pools of covered mortgages for direct sale to a community partner, the price of which shall be set by the Corporation based on a pricing model that considers— (I) the current fair market value of the properties; and (II) the potential impact of foreclosures on those properties to the value of other homes in the same census tract; or (ii) in the case of an auction, if the winning bid is not from a community partner, permitting any community partner that bid during that same auction to have a final opportunity to enter a higher bid on the pool. . (e) Sale of re-Performing loans The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 ( 12 U.S.C. 4501 et seq. ) is amended by inserting after section 1328 ( 12 U.S.C. 4548 ) the following: 1329. Sale of re-performing loans (a) Bulk auction or group sales An enterprise may not conduct bulk auctions or other group sales of single family re-performing residential loans unless the following requirements are met: (1) The enterprise establishes a system that provides priority to Federal, State, local, or Tribal governments or nonprofit organizations that have the capacity and experience required for buying, servicing, and resolving single family mortgage loans in a manner that promotes affordable housing, fair housing, affordable homeownership, provision of housing counseling, or neighborhood stabilization. (2) Clear, written notice is sent by the enterprise or servicer through certified and first-class mail to the borrower and all owners of record, with a copy sent to the enterprise if sent by the servicer, not less than 90 days before the inclusion of the loan in any proposed sale— (A) stating that the loan will be included in a bulk auction or group sale of re-performing loans; and (B) describing the bulk auction or group sale process, including— (i) the loss mitigation or other protections available to the borrower and other owners of record both before and after the auction or sale; and (ii) the obligations of the servicer of the loan before and after the auction or sale, including loss mitigation requirements. (3) The enterprise requires in the terms of the bulk auction or group sale that purchasers take loans subject to the following requirements: (A) The purchaser is required to offer targeted payment relief options to borrowers that become more than 60 days delinquent on their mortgage after their loan is sold that includes deferral of principal and term extension options that reduce payments to an affordable level. (B) The purchaser is required to offer a deferral program to borrowers that become more than 60 days delinquent on their mortgage after their loan is sold that offers terms and protections at least as favorable as those available under loss mitigation guidelines of the enterprise, including the absence of fees, to borrowers who can afford their pre-hardship mortgage payment. (C) Failure by the purchaser to follow the established loss mitigation guidelines shall serve as a defense to a judicial foreclosure and a basis to enjoin or otherwise stay a non-judicial foreclosure. (D) Data reporting as provided under subsection (b)(1). (E) If a property becomes vacant, the purchaser shall not release the lien until the property is sold or donated. (F) Use of contract for deed, lease to own, or a land installment contract to sell or otherwise transfer any property that is secured by a purchased loan shall be prohibited unless the tenant or purchaser is a nonprofit organization. (b) Data and reporting (1) Purchaser reporting During the 4-year period following any auction or sale of single family re-performing residential mortgage loans under subsection (a), the Director shall require the enterprise to collect from each purchaser of such loans, including any subsequent purchaser of a loan, quarterly loan-level data regarding the treatment and outcome of the loan, including— (A) loan characteristics, including loan type, remaining loan term, loan to value ratio, number of months in arrears, and loan status; (B) loss mitigation data, including whether loss mitigation was provided by the purchaser, debt-to-income ratio and percent payment reduction for any modified loans, and performance of modified loans; (C) demographic data for each borrower and any co-borrower, including race, national origin, sex, ZIP Code, and census tract, and, if available, disability status and veteran status; and (D) other purchaser actions, including charge offs and resales of loans and dates for such actions. (2) Semiannual reports to Congress The Director shall submit to Congress, and make publicly available at no cost to the public in a readily accessible format on the website of the Agency, semi-annual reports on— (A) loans sold in an auction or sale under subsection (a) by each enterprise, disaggregated by pool, including— (i) the number of loans and types of loans; (ii) mean and median delinquency and loan to value ratios at the time of the sale; (iii) the number and percentage of loans modified prior to auction or sale; and (iv) demographic and geographic data, including property locations by census tract or larger geographic location if necessary to protect personally identifiable information; (B) the performance of loans after an auction or sale under subsection (a), disaggregated by loan pool, including the initial purchaser, current owner, current servicer, data summarizing any alternatives to foreclosure offered and enacted, and data summarizing the data collected under subparagraph (A); and (C) the results of a fair lending analysis conducted based on the data in subparagraphs (A) and (B) to identify any discriminatory impacts or outcomes associated with the auctions or sales. (c) Penalties for noncompliance The enterprises may forcibly retain loans or properties, without providing compensation, from purchasers that do not meet the requirements under subsection (a)(3). (d) Regulations The Director shall issue regulations defining the terms of permissible auctions or sales in accordance with the requirements in this section. . II Taking the first steps to reverse the legacy of housing discrimination and government negligence 201. Down payment assistance program for first-time, first-generation homebuyers (a) Definitions In this section: (1) Eligible resident The term eligible resident means an individual who— (A) is a first-time homebuyer; (B) is a first-generation homebuyer; and (C) has an income that is less than— (i) 120 percent of the area median income; or (ii) in the case of a homebuyer acquiring a property for use as a principal residence that is located in a high-cost area, as determined by the Secretary, 140 percent of the area median income. (2) First-generation homebuyer The term first-generation homebuyer means a homebuyer who is, as self-attested by the homebuyer, an individual— (A) whose parents do not, or did not at the time of their death, to the best of the individual's knowledge, have any present ownership interest in a principal residence in any State, excluding ownership of heir property; and (B) whose spouse or domestic partner has not, during the 3-year period ending on the date of purchase of a property using a grant under subsection (b), had any present ownership interest in a principal residence in any State, excluding ownership of heir property, without regard to whether the spouse or domestic partner is a co-borrower on a mortgage for the property being purchased. (3) First-time homebuyer The term first-time homebuyer means a homebuyer who is, as self-attested by the homebuyer, an individual (and if married or in a domestic partnership, the spouse or domestic partner of the individual) who, during the 3-year period ending on the date of purchase of a property using a grant under subsection (b)— (A) has had no present ownership in a principal residence in any State, excluding ownership of heir property; or (B) surrendered any present ownership interest in a principal residence in any State, excluding ownership of heir property, as part of a divorce proceeding. (4) Heir property The term heir property means residential property for which title— (A) passed by operation of law through intestacy; and (B) is held by 2 or more heirs as tenants in common. (5) Secretary The term Secretary means the Secretary of Housing and Urban Development. (6) State The term State includes the District of Columbia and any territory or possession of the United States. (b) Establishment There is established in the Treasury of the United States a fund that— (1) shall be administered by the Secretary, acting through the Office of Housing of the Department of Housing and Urban Development; and (2) shall be used— (A) to provide grants to eligible residents to purchase a property for use as a principal residence; (B) for outreach to financial institutions in targeted areas and eligible residents, including for the administration of that outreach; (C) for counseling or financial education administered by counseling agencies approved by the Secretary in order to ensure sustainable homeownership; and (D) to maintain any records required to implement this section. (c) Grant amount An eligible resident may receive a grant under subsection (b) in an amount equal to— (1) not more than 3.5 percent of the appraised value of the property to be purchased; or (2) if the appraised value of the property to be purchased exceeds the principal obligation amount limitation for mortgages insured under title II of the National Housing Act ( 12 U.S.C. 1707 et seq. ), 3.5 percent of the maximum principal obligation limitation for the property to be purchased. (d) Relation to FHA loan An eligible resident shall not be required to obtain a mortgage that is insured under title II of the National Housing Act ( 12 U.S.C. 1707 et seq. ) as a condition of receiving a grant under subsection (b). (e) Layering of assistance Receipt by an eligible recipient of assistance for a down payment from a source other than the fund established under subsection (b), including assistance from the Federal Government, a State or local government, or any other public, private, or nonprofit source, shall not affect the eligibility of the eligible recipient for assistance under subsection (b). (f) Regulations and database Not later than 1 year after the date of enactment of this Act, the Secretary shall— (1) in consultation with interested parties, including housing counseling agencies approved by the Secretary and individuals or groups with expertise in fair housing, promulgate regulations relating to the use of the fund established under subsection (b); (2) promulgate regulations relating to the disbursement of funds under this section to ensure that an eligible resident is able to receive funds before the closing date for the home of the eligible resident, which may include creating a program that allows a lender to be reimbursed by the fund established under subsection (b) if the lender— (A) provides an eligible resident with funds for the closing; or (B) allows an eligible resident to be preapproved to receive assistance under this section when arranging financing for the home of the eligible resident; and (3) establish methods to verify that an individual is an eligible resident. (g) Appropriation Out of funds in the Treasury not otherwise appropriated, there is appropriated to the fund established under subsection (b) such sums as may be necessary for each of fiscal years 2025 through 2034 to carry out the activities under subsection (b)(2). (h) Inclusion of program in home buying information booklets Section 5(b) of the Real Estate Settlement Procedures Act of 1974 ( 12 U.S.C. 2604(b) ) is amended by inserting after paragraph (14) the following: (15) Information relating to the down payment assistance program established under section 201 of the American Housing and Economic Mobility Act of 2025 . . (i) Inclusion of program as mortgage product Section 203(f)(1) of the National Housing Act ( 12 U.S.C. 1709(f)(1) ) is amended by inserting , including the down payment assistance program established under section 201 of the American Housing and Economic Mobility Act of 2025 , after mortgage products . (j) Reliance on borrower attestations No additional documentation beyond the borrower’s attestation shall be required to demonstrate eligibility under paragraphs (2) and (3) of subsection (a), and no creditor shall be subject to liability, including monetary penalties or requirements to indemnify a Federal agency or repurchase a loan that has been sold or securitized, for the provision of down payment assistance under this section to a borrower who does not meet the eligibility requirements under those paragraphs if the creditor does so in good faith reliance on borrower attestations of eligibility required by those paragraphs or any regulation promulgated to carry out those paragraphs. (k) Repayment of assistance (1) Requirement An eligible resident who receives a grant under subsection (b) to purchase a property for use as a principal residence and does not occupy the property as a principal residence for 5 years or more shall repay to the Secretary a proportional amount of the grant based on the number of years, if any, for which the eligible resident has occupied the property as a principal residence. (2) Limitation Notwithstanding paragraph (1), an eligible resident who receives a grant under subsection (b) to purchase a property for use as a principal residence and does not occupy the property as a principal residence for 5 years or more shall not be liable to the Secretary for repayment under paragraph (1) of this subsection if— (A) the failure to occupy the property as a principal residence is due at least in part to a hardship; or (B) the eligible resident sells the property before the expiration of the 5-year period beginning on the date of acquisition and the capital gains from the sale to a bona fide purchaser in an arm’s length transaction are less than the amount the eligible resident would be required to repay under paragraph (1). 202. Formula grant program for communities with an appraisal gap (a) Definitions In this section— (1) the term neighborhood with an appraisal gap means a census tract in which the median sales price of a dwelling unit is lower than the median cost to acquire and rehabilitate, or build, a new dwelling unit; (2) the term Secretary means the Secretary of Housing and Urban Development; and (3) the term State has the meaning given the term in section 3(b)(7) of the United States Housing Act of 1937 ( 42 U.S.C. 1437a(b)(7) ). (b) Establishment The Secretary shall establish a formula grant program to provide funding to States to support neighborhoods with an appraisal gap, including borrowers with negative equity in their primary residence in those neighborhoods, through— (1) measures that provide funds to borrowers to— (A) pay down arrears on an otherwise affordable loan; (B) pay down arrears or principal on a loan in order to qualify for a loan modification that will allow the borrower to keep the home; (C) pay off, or pay down part of, a second mortgage or home equity line of credit; (D) pay off a small-dollar mortgage; (E) pay delinquent taxes and tax liens; (F) pay off delinquent water or sewer bills and liens; and (G) pay for home repairs or maintenance or for modifications to bring the home into compliance with any applicable codes; and (2) programs to purchase or rehabilitate vacant or distressed properties to enhance neighborhood property values. (c) Formula The Secretary shall distribute amounts under this section to States based on— (1) the number of borrowers with a primary residence with negative equity in each State; and (2) the share of neighborhoods with an appraisal gap in each State. (d) Authorization of appropriations There is authorized to be appropriated to carry out this section $5,000,000,000 for fiscal year 2025. 203. Strengthening the Community Reinvestment Act of 1977 (a) Short title This section may be cited as the Community Reinvestment Reform Act of 2025 . (b) Amendments to the Community Reinvestment Act of 1977 The Community Reinvestment Act of 1977 ( 12 U.S.C. 2901 et seq. ) is amended— (1) by striking sections 802 and 803 ( 12 U.S.C. 2901 , 2902) and inserting the following: 802. Findings and purpose (a) Findings Congress finds that— (1) regulated financial institutions are required by law to demonstrate that they serve the convenience and needs of the communities in which they are chartered or do business, in particular low- and moderate-income communities; (2) the convenience and needs of communities include the need for credit services, deposit services, transaction services, other financial services, and community development loans and investments; and (3) regulated financial institutions have a continuing and affirmative obligation to meet the credit or other financial needs of all the local communities in which they are chartered or do business, including communities in which— (A) the institutions make loans and do not accept deposits; or (B) the institutions accept deposits but do not make loans. (b) Purpose It is the purpose of this title to require each appropriate Federal financial supervisory agency to use its authority when examining regulated financial institutions to ensure that those institutions meet the credit and other financial needs of the local communities in which they are chartered or do business consistent with the safe and sound operation of those institutions. 803. Definitions In this title: (1) Application for a deposit facility The term application for a deposit facility means an application to the appropriate Federal financial supervisory agency otherwise required under Federal law or regulations thereunder for— (A) a charter for a national bank or Federal savings and loan association; (B) deposit insurance in connection with a newly chartered State bank, savings bank, savings and loan association, or similar institution; (C) the establishment of a domestic branch or other facility with the ability to accept deposits of a regulated financial institution; (D) the relocation of the home office or a branch office of a regulated financial institution; (E) the merger or consolidation with, the acquisition of the assets of, or the assumption of the liabilities of a regulated financial institution requiring approval under section 18(c) of the Federal Deposit Insurance Act ( 12 U.S.C. 1828(c) ); or (F) the acquisition of shares in, or the assets of, a regulated financial institution requiring approval under section 3 of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1842 ). (2) Appropriate Federal banking agency The term appropriate Federal banking agency has the meaning given the term in section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 ). (3) Appropriate Federal financial supervisory agency The term appropriate Federal financial supervisory agency means— (A) the appropriate Federal banking agency with respect to depository institutions and depository institution holding companies; and (B) the Bureau of Consumer Financial Protection with respect to any covered person supervised by the Bureau pursuant to section 1024 of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5514 ). (4) Assessment area The term assessment area means, with respect to a regulated financial institution, each community, including a State, metropolitan area, or urban or rural county, in which the institution— (A) maintains deposit-taking branches, automated teller machines, or retail offices; (B) is represented by an agent; or (C) issues a significant number of loans or other products relative to the total number of loans or other products made by the institution or relative to the total number of loans or other products offered by the private sector market. (5) Climate resiliency and disaster mitigation The term climate resiliency and disaster mitigation means activities that— (A) assist individuals and communities to prepare for, adapt to, and withstand climate-related risks, natural disasters, or weather-related disasters; (B) benefit or serve residents of low- to moderate-income census tracts or climate vulnerable communities and do not directly result in forced or involuntary relocation of those residents; and (C) are done in conjunction with— (i) a plan, program or initiative of a Federal, State, local or Tribal government; or (ii) a mission-driven nonprofit organization that is focused on benefiting or serving targeted census tracts or climate vulnerable communities. (6) Climate vulnerable communities The term climate vulnerable communities means communities experiencing heightened risk and increased sensitivity to climate change with less capacity and fewer resources to cope with, adapt to, or recover from climate impacts, as determined by the appropriate Federal financial supervisory agencies. (7) Community benefits plan The term community benefits plan means a plan that provides measurable goals for future amounts of safe and sound loans, investments, services, and other financial products for low- and moderate-income communities and other distressed or underserved communities. (8) Community development The term community development includes— (A) affordable housing for low- or moderate-income individuals and avoidance of patterns of lending resulting in the loss of affordable housing units and housing for low- and moderate-income individuals in high-opportunity areas; (B) community development services, including counseling and successful mortgage or loan modifications of delinquent loans; (C) activities that promote integration; (D) activities that promote economic development by financing small businesses or farms that meet the size eligibility requirements of the development company or small business investment company programs under section 121.301 of title 13, Code of Federal Regulations, or any successor regulation, with an emphasis on small businesses that have gross annual revenues of not more than $1,000,000; (E) activities that revitalize or stabilize— (i) low- or moderate-income geographies; (ii) designated disaster areas; (iii) distressed or underserved nonmetropolitan middle-income geographies designated by the Federal Financial Institutions Examination Council, based on— (I) rates of poverty, unemployment, and population loss; or (II) population size, density, and dispersion, if those activities help to meet essential community needs, including the needs of low- and moderate-income individuals; or (iv) other distressed or underserved communities; (F) activities that promote physical, environmental, and sensory accessibility in housing stock that is integrated into the community; and (G) other activities that promote the objectives of this title, as determined by the appropriate Federal financial supervisory agencies. (9) Depository institution; depository institution holding company; insured depository institution The terms depository institution , depository institution holding company , and insured depository institution have the meanings given those terms in section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 ). (10) Entire community The term entire community means— (A) all of the assessment areas of a regulated financial institution; and (B) areas outside of assessment areas described in subparagraph (A) in which a regulated financial institution has made loans or received deposits. (11) Enumerated consumer laws The term enumerated consumer laws has the meaning given the term in section 1002 of the Consumer Financial Protection Act of 2010 ( 12 U.S.C. 5481 ). (12) Fossil fuel The term fossil fuel means coal, petroleum, methane gas (often referred to as natural gas ), or any derivative of coal, petroleum, or methane gas that is used for fuel directly or indirectly, such as for generating electricity. (13) Fossil fuel company The term fossil fuel company means any company that— (A) is among the 200 companies with the largest fossil fuel reserves in the world; (B) is among the 30 largest public company owners in the world of coal-fired power plants; (C) has as its core business— (i) the construction or operation of fossil fuel infrastructure; or (ii) the exploration, extraction, refining, processing or distribution of fossil fuels; or (D) receives more than 50 percent of its gross revenue from companies that meet the definition under subparagraph (A), (B), or (C). (14) Fossil fuel expansion The term fossil fuel expansion means financing for new fossil fuel infrastructure projects, including financing of exploration activities, that would— (A) increase greenhouse gas emissions; and (B) increase the difficulty of achieving Federal, State, or local carbon emission reduction goals. (15) Fossil fuel infrastructure The term fossil fuel infrastructure means oil or gas wells, oil or gas pipelines and refineries, oil, coal or gas-fired power plants, oil and gas storage tanks, fossil fuel export terminals, and any other infrastructure used exclusively for fossil fuels, including facilities with carbon capture, utilization, and storage. (16) Geography The term geography means a census tract delineated by the Bureau of the Census in the most recent decennial census. (17) Intermediate bank The term intermediate bank is a depository institution with assets of not less than $402,000,000 and less than $1,609,000,000, as adjusted annually for purposes of an examination under section 804. (18) Large bank The term large bank is a depository institution with assets of not less than $1,609,000,000, as adjusted annually for purposes of an examination under section 804. (19) Other distressed or underserved community The term other distressed or underserved community means an area or census tract that, according to a periodic review and data analysis by the appropriate Federal financial supervisory agencies on an interagency basis through the Federal Financial Institutions Examination Council of certain metrics, such as loans per households or small business, is experiencing economic hardship or is underserved by financial institutions. (20) Other underserved population The term other underserved population means a population that is experiencing ongoing effects of discrimination or is relatively underserved by financial institutions, as measured by loans per households or other similar metrics. (21) Regulated financial institution The term regulated financial institution means— (A) an insured depository institution; (B) a depository institution holding company; and (C) a U.S. nonbank mortgage originator. (22) Retail lending assessment area The term retail lending assessment area means a geographical area in which a regulated financial institution— (A) makes a threshold number of loans, as determined by the appropriated Federal supervisory agencies; (B) does not have branches, deposit-taking automated teller machines, or offices; and (C) is not represented by agents. (23) Small bank The term small bank is a depository institution with assets of less than $402,000,000, as adjusted annually to take into account inflation for purposes of determining which institutions are subject to an examination under section 804. (24) U.S. nonbank mortgage originator The term U.S. nonbank mortgage originator means a covered person subject to section 1024 of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5514 ) that offers or provides— (A) origination of loans secured by real estate for use by consumers primarily for personal, family, or household purposes; or (B) loan modification or foreclosure relief services in connection with a loan described in subparagraph (A). ; (2) in section 804 ( 12 U.S.C. 2903 )— (A) by redesignating subsections (c) and (d) as subsections (f) and (g), respectively; (B) by striking subsections (a) and (b) and inserting the following: (a) Depository institutions and bank holding companies (1) In general In connection with its examination of a regulated financial institution other than a U.S. nonbank mortgage originator, the appropriate Federal financial supervisory agency shall perform the following: (A) Assess the record of the institution in meeting the credit and other financial needs of its entire community, in particular low- and moderate-income people and communities, and other distressed or underserved communities, and other underserved populations consistent with the safe and sound operation of the institution. (B) Assess the effectiveness of the following activities in meeting the credit and other financial needs of the assessment areas of the institution, consistent with the safe and sound operation of the institution: (i) Retail lending, including home, small business, consumer, automobile, and other lending and financial products, that responds to credit needs or other financial needs. (ii) Community development lending and investments, which may include a consideration of— (I) the origination of loans and other efforts by the institution to assist existing low- and moderate-income residents to remain in affordable housing in their community; and (II) the origination of loans by the institution that result in the construction, rehabilitation, or preservation of affordable housing units. (iii) Community development finance tests or similar tests developed by the appropriate Federal banking agencies shall include separate quantitative measures for community development investments. The evaluation of investments shall positively or negatively affect test scores depending on bank performance, in community development finance tests or similar tests. (iv) Retail financial services and community development services. (v) Evaluation of the responsiveness, affordability, and sustainability of retail financial services including credit and deposit products shall positively or negatively affect tests scores, depending on bank performance, in the retail products and service test or similar tests. (vi) Retail lending assessment areas shall be established for large banks and intermediate banks if not more than 90 percent of the retail loans of the bank are in assessment areas containing their branches and deposit-taking automated teller machines. Large banks and intermediate bank evaluations shall also examine lending outside of retail lending assessment areas and assessment areas containing branches and deposit-taking automated teller machines. Evaluations of these loans shall be considered when assigning an institution level rating to the bank. (C) With respect to its evaluation of an application for a deposit facility by the institution— (i) consider the record described in subparagraph (A), the effectiveness of the activities described in subparagraph (B), the overall rating of the institution under this section, and any improvement plans submitted pursuant to this section; (ii) provide an opportunity for public comment for a period of not less than 60 days; (iii) consider changes in the community reinvestment performance of the institution since the most recent rating under this section by the appropriate Federal financial supervisory agency; and (iv) require— (I) a demonstration of public benefit, including a community benefits plan with measurable goals regarding increasing responsible lending and other financial products that is commensurate with the ability of the institution to accomplish those goals; (II) that the institution consult with community-based organizations and other community stakeholders in developing the community benefits plan; and (III) a public hearing for any institution that has a received a need-to-improve or low satisfactory grade in any individual assessment area during the most recent examination. (2) Consideration of lending in partnership with non-depository lenders (A) In general As part of assessing a financial institution under paragraph (1), the appropriate Federal financial supervisory agency shall evaluate the performance of the financial institution in originating loans for small farms, consumer loans (including residential mortgages, unsecured installment loans, advances, and lines of credit), and loans for small businesses (including unsecured installment loans, advances, and lines of credit) in partnership with 1 or more non-depository lenders. (B) Affordability and sustainability In making the evaluation described in subparagraph (A), the appropriate Federal financial supervisory agency shall consider the affordability and sustainability of the loan originations made in partnership with 1 or more non-depository lenders. (C) Definitions In this paragraph: (i) Non-depository lender The term non-depository lender means a lender that is not an insured depository institution. (ii) Small business; small farm The terms small business and small farm have the meanings given those terms under the regulations promulgated by the Bureau implementing the amendments made by section 1071 of the Dodd Frank Wall Street Reform and Consumer Protection Act of 2010 ( Public Law 111–203 ; 124 Stat. 2056) under part 1002 of title 12, Code of Federal Regulations, or any successor regulation. (3) Deductions for fossil expansion (A) In general As part of assessing a financial institution under paragraph (1), the appropriate Federal financial supervisory agency shall— (i) determine the total dollar amount of loans and investments to fossil fuel companies for the purposes of fossil fuel expansion that were originated or held by the financial institution during the period covered by an examination under section 804; and (ii) deduct not more than that total dollar amount from the reported community development loans and investments of the financial institution, both in the aggregate and at the local market, or assessment area, level. (B) Activities The deduction described in subparagraph (A)(ii) may only be offset by financing by the institution of climate resiliency and disaster mitigation activities specifically targeted to underserved communities, such as— (i) the development of climate resilient affordable housing, schools, and small businesses (as defined in paragraph (2)(C)); (ii) clean electricity projects and microgrids; (iii) nature-based protective infrastructure; (iv) building decarbonization, which includes holistic home weatherization and health interventions; (v) lending to green small businesses and companies with legitimate public decarbonization transition plans, strategies, and targets; (vi) electric public transit and electric vehicle charging infrastructure; (vii) investments in weatherization and climate resilience for local businesses; (viii) operational and technical support and capacity building for environmental and climate justice organizations, including support for community groups active in environmental testing and training of community members to identify climate or environmental risks and opportunities in their communities; and (ix) workforce development related to the transition away from fossil fuels, including activities to train workers on skills needed to participate in carbon-pollution-free energy sectors. (4) Penalties for sustained failing performance A regulated financial institution other than a U.S. nonbank mortgage originator that receives overall performance ratings under this section of needs to improve or substantial noncompliance for 2 consecutive examinations shall be subject to the following penalties, as deemed applicable by the appropriate Federal financial supervisory agency: (A) Restrictions on the institution’s growth (overall or in discrete areas), business activities, or payment of dividends, including restrictions on ability to sell loans originated by the institution to enterprises, as defined in section 1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 ( 12 U.S.C. 4502 ). (B) Recommendations to appropriate State agencies that State mortgage licenses be suspended or revoked with a statement of facts covering the justification for the recommended suspension or revocation. (C) Requiring the institution to simplify or reduce its operations, including that the institution reduce its asset size, divest subsidiaries or business lines, or exit from 1 or more markets of operation. (D) Recovery, or claw back, of portions of executive compensation received during consecutive evaluation periods under this section of which the institution received an overall performance rating of needs to improve or substantial noncompliance . (b) U.S. nonbank mortgage originator (1) In general In connection with its examination of a U.S. nonbank mortgage originator, the appropriate Federal financial supervisory agency shall perform the following: (A) Assess the record of the U.S. nonbank mortgage originator in meeting the credit or other financial needs of its entire community, in particular low-income and moderate-income people and communities and other distressed or underserved communities and other underserved populations, consistent with the safe and sound operation of the U.S. nonbank mortgage originator. (B) Assess, as appropriate, the following activities in the assessment areas of the U.S. nonbank mortgage originator: (i) Retail lending, including home loans. (ii) Community development services. (iii) Community development lending and investments, which may include a consideration of— (I) the origination of loans and other efforts by the institution to assist existing low- and moderate-income residents to remain in affordable housing in their community; (II) the origination of loans by the institution that result in the construction, rehabilitation or preservation of affordable housing units; and (III) investments in, grants to, or loans to community development financial institutions (as defined in section 103 of the Community Development Banking and Financial Institutions Act of 1994 ( 12 U.S.C. 4702 )), community development corporations (as defined in section 613 of the Community Economic Development Act of 1981 ( 42 U.S.C. 9802 )), and other nonprofit organizations serving the housing and development needs of the community. (iv) Retail lending assessment areas shall be established if not more than 90 percent of the retail loans of the U.S. nonbank originator are in containing offices or agents. The evaluations shall also examine lending outside of retail lending assessment areas and assessment areas containing offices or agents. Evaluations of these loans shall be considered when assigning an institution level rating to the U.S. nonbank mortgage originator. (C) With respect to its evaluation of an application for a deposit facility by the U.S. nonbank mortgage originator— (i) consider the record described in subparagraph (A), the activities described in subparagraph (B), the overall rating of the U.S. nonbank mortgage originator under this section, and any improvement plans submitted pursuant to this section; (ii) provide an opportunity for public comment for a period of not less than 60 days; (iii) consider changes in the community reinvestment performance of the U.S. nonbank mortgage originator since the most recent rating under this section by the appropriate Federal financial supervisory agency; and (iv) require— (I) a demonstration that granting the application for a deposit facility is in the public interest, which shall include a submission of a community benefits plan, which shall be commensurate with the ability of the institution to accomplish the plan, by the U.S. nonbank mortgage originator to the appropriate Federal financial supervisory agency; (II) that the U.S. nonbank mortgage originator consult with community-based organizations and other community stakeholders in developing the community benefits plan; and (III) a public hearing for any U.S. nonbank mortgage originator that has a received a need-to-improve or low satisfactory grade in any individual assessment area during the most recent examination. (2) Penalties and fees The appropriate Federal financial supervisory agency shall have the same authority to assess penalties and fees under subsection (a)(4) for the U.S. nonbank mortgage originator as is the case for regulated financial institutions described in subsection (a). (3) Authority to adjust examination and supervisory fees The appropriate Federal financial supervisory agencies shall have the authority to adjust the dollar amount of examination and supervisory fees, based in part on the rating of institutions under this section. (c) Requirements (1) In general In connection with its examination of a regulated financial institution under subsection (a) or (b), the appropriate Federal financial supervisory agency shall— (A) consider public comments received by the appropriate Federal financial supervisory agency regarding the record of the institution in meeting the credit or other financial needs of its entire community, including low- and moderate-income communities, and hold not less than 1 public hearing to receive comments for large banks with assets of not less than $50,000,000,000; and (B) require— (i) an improvement plan for an institution that receives a rating of ‘low satisfactory’ or lower on the written evaluation of the institution, or such a rating in any individual assessment area; and (ii) the improvement plan described in clause (i) to result in the reasonable likelihood that the institution will obtain a rating of at least high satisfactory in meeting community credit or other financial needs in the relevant measure on the next examination. (2) Improvement plan (A) In general A regulated financial institution that is required to submit an improvement plan required under paragraph (1)(B) shall submit the plan in writing to the appropriate Federal financial supervisory agency not later than 90 days after receiving notice that the regulated financial institution is required to submit the plan. (B) Public comment Upon receipt of an improvement plan of a regulated financial institution required under paragraph (1)(B), the appropriate Federal financial supervisory agency shall— (i) make the plan available to the public for review and comment for a period of not less than 60 days; and (ii) require the regulated financial institution to revise, as appropriate, the improvement plan in response to the public comments received under the public review and comment period described in clause (i) and submit the plan to the appropriate Federal financial supervisory agency not later than 60 days after the end of that period. (3) Examination of certain regulated financial institutions In the case of a regulated financial institution whose lending or other business is not clustered in geographical areas and is thinly dispersed across the country, the institution shall— (A) be evaluated under subsection (a) or (b), as applicable— (i) by considering the effectiveness of the institution in serving customers or borrowers, with a special emphasis on low- and moderate-income individuals and other underserved populations across the country regardless of where the individuals reside; and (ii) based on objective thresholds developed by the appropriate Federal financial supervisory agencies to clarify when lending or other business is dispersed across the country and not clustered in distinct geographical areas, which may include low levels of lending or other financial products across States or other areas; and (B) meet the needs of other distressed or underserved communities. (d) Consideration Remediation of consumers pursuant to an order by a court or administrative body or a settlement with a government agency or a private party may not be considered in an assessment conducted under subsection (a) or (b). (e) Rule of construction An evaluation of a bank holding company under this section shall incorporate evaluations of subsidiary regulated financial institutions made by the appropriate Federal financial supervisory agency of each subsidiary, if applicable. ; (C) in subsection (f), as so redesignated— (i) by striking paragraph (2); (ii) by redesignating paragraph (3) as paragraph (2); and (iii) in paragraph (2), as so redesignated, by striking subparagraph (C); and (D) in subsection (g), as so redesignated, by striking subsection (a) and inserting subsections (a) and (b) ; (3) in section 807 ( 12 U.S.C. 2906 )— (A) in subsection (a)— (i) by striking an insured depository institution and inserting a regulated financial institution ; and (ii) by inserting or financial after credit ; (B) in subsection (b)— (i) in paragraph (1)— (I) in subparagraph (A)— (aa) in clause (ii), by striking and at the end; (bb) by redesignating clause (iii) as clause (iv); and (cc) by inserting after clause (ii) the following: (iii) disclose whether the institution engaged in acts or practices that the Bureau of Consumer Financial Protection has determined, and has publicly disclosed, violate the enumerated consumer laws; and ; and (II) by striking subparagraph (B) and inserting the following: (B) Evaluation on an assessment area basis The information required under subsections (a) and (b) of section 804 shall be presented separately for each assessment area. (C) Treatment with respect to violations of enumerated consumer laws If a regulated financial institution has engaged in acts or practices that the appropriate Federal financial supervisory agency has determined to be unfair, deceptive, or abusive or acts or practices that violate enumerated consumer laws intended to ensure the fair, equitable, and nondiscriminatory access to credit for individuals and communities that are enforced by the Bureau of Consumer Financial Protection or other Federal or State agencies, the written evaluation shall be negatively influenced in a manner commensurate with the extent of the harm suffered by those individuals and communities. ; (ii) in paragraph (2)— (I) by striking subparagraphs (A), (B), (C), and (D) and inserting the following: (A) Outstanding record of meeting community credit or other financial needs . (B) High Satisfactory record of meeting community credit or other financial needs . (C) Low Satisfactory record of meeting community credit or other financial needs . (D) Needs to improve record of meeting community credit or other financial needs . (E) Substantial noncompliance in meeting community credit or other financial needs . ; and (iii) by inserting after the flush text following paragraph (2) the following: (3) Additional authority The appropriate Federal financial supervisory agencies may— (A) alter the ratings under this subsection to change or include additional ratings for the overall ratings and subtest ratings; and (B) develop an accompanying point system that includes ranges for each rating category under paragraph (2). ; (C) by redesignating subsection (e) as subsection (f); and (D) by inserting after subsection (d) the following: (e) Appeals of rating If a regulated financial institution appeals the assigned rating under this section, the appropriate Federal financial supervisory agency shall— (1) post a public notice of the appeal on the part of the website of the appropriate Federal financial supervisory agency that contains information on this title; and (2) provide an opportunity for public comment on the appeal. ; (4) in section 806 ( 12 U.S.C. 2905 )— (A) by striking Regulations and inserting the following: (a) In general Regulations ; (B) in subsection (a), as so designated, by striking companies,, and inserting companies, ; and (C) by adding at the end the following: (b) Periodic review Not later than 5 years after the date of enactment of this subsection and every 5 years thereafter, the appropriate Federal financial supervisory agencies shall— (1) review the regulations promulgated to carry out this title; and (2) report to Congress any recommendations for updates to the regulations and this title, which may include consideration of— (A) data collection under this title; (B) the rigor of evaluations under this title; (C) the assessment area coverage of loans and deposits; and (D) the extent to which the provisions of this title are reducing disparities in access to credit and capital by income and race. ; and (5) by adding at the end the following: 810. Data collection and reporting requirements (a) Data collection (1) Consumer loans (A) In general Each regulated financial institution shall collect and maintain in machine readable form, as prescribed by the appropriate Federal financial supervisory agency, data for consumer loans originated or purchased by the regulated financial institution, including motor vehicle loans, credit cards, lines of credit, and other secured or unsecured loans. The regulated financial institution shall maintain data separately for each category of consumer loan, including the following for each loan: (i) A unique number or alpha-numeric symbol that can be used to identify the relevant loan. (ii) The loan amount at origination or purchase. (iii) The loan location. (iv) The gross annual income of the borrower that the regulated financial institution considered in making its credit decision. (B) Exemptions The appropriate Federal financial supervisory agencies may exempt classes of regulated financial institutions from the requirements under subparagraph (A) due to low levels of consumer lending or other factors. (2) Community development loans and investments (A) Collection and maintenance of data Each regulated financial institution shall collect and maintain in machine readable form, as prescribed by the appropriate Federal financial supervisory agency, data on the categories of community development lending and investments, including data regarding financing affordable housing, small business development, and economic development. (B) Public dissemination Each regulated financial institution and the appropriate Federal financial supervisory agencies shall— (i) publicly disseminate the data described in subparagraph (A) on a county level and for categories of census tracts including low- and moderate-income census tracts or other distressed and underserved census tracts; and (ii) consider disseminating the data described in subparagraph (A) by individual census tracts in addition to the categories described in clause (i). (3) Assessment area data (A) In general Each regulated financial institution shall collect and report to the appropriate Federal financial supervisory agency by March 1 of each year a list for each assessment area showing the geographies within the area. (B) Publication The appropriate Federal financial supervisory agencies shall make the list of assessment areas reported by each regulated financial institution under subparagraph (A) publicly available on the part of the website of the appropriate Federal financial supervisory agency that contains information on this title. (4) Deposits The appropriate Federal financial supervisory agencies shall— (A) collect data from regulated financial institutions that reflects— (i) the number of customers of those institutions that reside in categories of census tracts including low- and moderate-income census tracts or other distressed and underserved census tracts and the dollar amount of deposits of those customers; and (ii) the number of small businesses that are located in the census tract categories described in clause (i); and (B) consider the dissemination of the deposit data collected under subparagraph (A) by individual census tracts in addition to the categories described in that subparagraph. (b) Aggregate disclosure statements (1) In general Each appropriate Federal financial supervisory agency shall prepare annually, for each assessment area, a disclosure statement of home, small business, small farm, and consumer lending for each regulated financial institution subject to reporting under this section and an aggregated statement for all reporting institutions combined, which shall indicate, for each assessment area, the number and amount of all small business, small farm, and consumer loans originated or purchased sorted by income level of borrowers, race and ethnicity of borrowers, revenue size of small businesses and farms, and categories of census tracts. (2) Deposits and community development loans and investments An appropriate Federal financial supervisory agency shall include data on deposits and community development loans and investments in the disclosure statements prepared under paragraph (1). (3) Adjusted form An appropriate Federal financial supervisory agency may adjust the form of the disclosure statement prepared under paragraph (1) if necessary, because of special circumstances, to protect the privacy of a borrower or the competitive position of a regulated financial institution. (c) Central data depositories The Federal Financial Institutions Examination Council, in consultation with the appropriate Federal financial supervisory agencies, shall implement a system— (1) to allow the public to access online and in a searchable format the data maintained under paragraphs (1) through (4) of subsection (a); and (2) that ensures that personally identifiable financial information is not disclosed to public. (d) Limitation An appropriate Federal financial supervisory agency may not use the authorities of the appropriate Federal financial supervisory agency under this section to obtain a record from a regulated financial institution for the purpose of gathering or analyzing the personally identifiable financial information of a consumer. 811. Community Advisory Committees (a) Depository institutions Each regulated financial institution that is not a U.S. nonbank mortgage originator shall form a separate Community Advisory Committee (which shall be composed of a diverse set of consumer, housing, community development, and other stakeholder groups) in each of the following: (1) With respect to a depository institution with consolidated assets equal to or greater than $2,000,000,000 the branches of which are located in 1 census region, each metropolitan statistical area where the financial institution or any subsidiaries of the financial institution have a branch or other facility (including an automated teller machine) and each metropolitan statistical area where the financial institution has a substantial number of customers who maintain deposit accounts with the financial institution. (2) With respect to a depository institution with consolidated assets equal to or greater than $2,000,000,000 the branches of which are located in more than 1 census region, each census division within each of the regions. (3) With respect to a depository institution with consolidated assets of less than $2,000,000,000, each State where the financial institution or any subsidiaries of the financial institution are located. (b) U.S. nonbank mortgage originators Each U.S. nonbank mortgage originator shall form a separate Community Advisory Committee (which shall be composed of a diverse set of consumer, housing, community development, and other stakeholder groups) in each of the following: (1) With respect to a U.S. nonbank mortgage originator that is required to make a number of disclosures under the Home Mortgage Disclosure Act of 1975 ( 12 U.S.C. 2801 et seq. ) that is less than the national median, each State in which the U.S. nonbank mortgage originator offers loans. (2) With respect to a U.S. nonbank mortgage originator that is required to make a number of disclosures under the Home Mortgage Disclosure Act of 1975 ( 12 U.S.C. 2801 et seq. ) that is more than the national median, each census division within the census regions in which the U.S. nonbank mortgage originator offers loans. (c) Biannual consultation The executives of each regulated financial institution shall meet not less frequently than twice per year with the Community Advisory Committees of the regulated financial institution formed under subsection (a) or (b), as applicable— (1) to discuss the financial institution’s current work to meet the credit and deposit needs of low- and moderate-income individuals and underserved communities, persons with disabilities, LGBTQ+ communities, and Chinese, Asian Indian, Filipino, Japanese, Korean, Vietnamese, Pakistani, Cambodian, Hmong, Laotian, Thai, Taiwanese, Burmese, Bangladeshi, Nepalese, Indonesian, Malaysian, Hispanic or Latino, Black or African American, American Indian and Alaska Native, Native Hawaiian, Samoan, Chamorro, Tongan, iTaukei, Marshallese, and Other Pacific Islander communities, as applicable to the geographic areas of the financial institution; (2) with respect to an institution described in subsection (a)(2) or a U.S. nonbank mortgage originator described in subsection (b)(2), to assist the executives in developing and updating a plan for how the institution will work to meet the credit needs of the institution’s entire community, including low- and moderate-income neighborhoods; and (3) to discuss the institution’s data (which shall be disaggregated by Chinese, Asian Indian, Filipino, Japanese, Korean, Vietnamese, Pakistani, Cambodian, Hmong, Laotian, Thai, Taiwanese, Burmese, Bangladeshi, Nepalese, Indonesian, Malaysian, Hispanic or Latino, Black or African American, American Indian and Alaska Native, and Native Hawaiian, Samoan, Chamorro, Tongan, iTaukei, Marshallese and Other Pacific Islander communities, as applicable to the institution’s geographic areas) on— (A) mortgage lending and lending to small businesses and small farms, as defined in section 804(a)(2)(C); (B) retail products and services; (C) community development services; and (D) community development financing. (d) Specific consultations In addition to the consultations required under paragraph (2), the executives of a depository institution described in subsection (a)(2) shall meet with the Community Advisory Committee of the institution before— (1) the institution applies for a merger or acquisition; (2) the institution, or any subsidiary of the institution, applies for deposit insurance; (3) the institution applies to open a new branch or to relocate an existing branch; or (4) the institution provides notice that it would close a branch or other facility. 812. Study on discrimination and disparities in access to credit (a) Study Not later than the end of the 2-year period beginning on the date of enactment of this section, and every 2 years thereafter, the appropriate Federal financial supervisory agencies shall, jointly, and in consultation with such other Federal or State agencies as the appropriate Federal financial supervisory agencies determine appropriate, complete an interagency statistical study to identify— (1) metropolitan areas and rural counties that either experience ongoing discrimination or exhibit significant racial disparities in access to credit for any racial or ethnic group; and (2) significant disparities in access to branches by racial or ethnic composition of census tract and disparities in access to community development financing by racial or ethnic composition of census tract. (b) Use of data In carrying out each study required under subsection (a), the appropriate Federal financial supervisory agencies shall make use of data including— (1) data obtained under the Home Mortgage Disclosure Act of 1975 ( 12 U.S.C. 2801 et seq. ); (2) data obtained under section 704B of the Equal Credit Opportunity Act ( 15 U.S.C. 1691c–2 ); (3) data obtained under this Act; (4) available State data; and (5) information contained in public litigation against regulated financial institutions for redlining or lending discrimination (including litigation initiated by the Bureau of Consumer Financial Protection, the Department of Housing and Urban Affairs, the Department of Justice, or by private parties). (c) Report Upon the completion of each study required under subsection (a), the appropriate Federal financial supervisory agencies shall jointly submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives a report that includes— (1) all findings and determinations made in carrying out the study; and (2) policy recommendations to remedy the discrimination and disparities identified in the study. 813. Public registries The appropriate Federal supervisory financial agencies, acting through the Federal Financial Institutions Examination Council, shall— (1) maintain a list of community-based organizations and other stakeholders who wish to be listed and who have commented on examinations conducted under section 804 and applications regarding community needs and bank performance; and (2) conduct outreach to community groups and strive for geographical diversity, gender and racial diversity, and diversity in terms of various types of needs, including affordable housing and economic development to community facilities. . (c) Amendment to the Bank Holding Company Act of 1956 Section 4(k)(6) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1843(k)(6) ) is amended to read as follows: (6) Notice and opportunity for comment required (A) In general No financial holding company shall directly or indirectly acquire, and no company that becomes a financial holding company shall directly or indirectly acquire control of, any company in the United States, including through merger, consolidation, or other type of business combination, that is engaged in activities permitted under this subsection or subsection (n) or (o), unless— (i) the holding company has provided notice to the Board, not later than 60 days prior to the proposed acquisition or prior to becoming a financial holding company, and during that time period, or such longer time period not exceeding an additional 60 days, as established by the Board; (ii) the Board has provided public notice and opportunity for comment for not less than 60 days; and (iii) the Board has not issued a notice disapproving the proposed acquisition or retention. (B) Factors for consideration In reviewing any prior notice filed under this paragraph, the Board shall— (i) consider the overall rating of the financial holding company under the Community Reinvestment Act of 1977 ( 12 U.S.C. 2901 et seq. ) and any improvement plans submitted pursuant to that Act; (ii) provide opportunity for public comment for a period of not less than 60 days; (iii) consider changes in the community reinvestment performance of the financial holding company since the last rating under the Community Reinvestment Act of 1977 ( 12 U.S.C. 2901 et seq. ) by the appropriate Federal financial supervisory agency; and (iv) require— (I) a demonstration that granting the application for a deposit facility is in the public interest, which shall include submission to the appropriate Federal financial supervisory agency of a community benefits plan commensurate with the ability of the institution to carry out that plan; (II) that the institution consult with community-based organizations and other community stakeholders in developing the community benefits plan; and (III) a public hearing for any bank that has received a need-to-improve or low satisfactory grade in any assessment area during the last examination under the Community Reinvestment Act of 1977 ( 12 U.S.C. 2901 et seq. ). . (d) Technical and conforming amendment Section 10(c)(2)(H)(i) of the Home Owners' Loan Act ( 12 U.S.C. 1467a(c)(2)(H)(i) ) is amended by striking section 804(c) of the Community Reinvestment Act of 1977 ( 12 U.S.C. 2903(c) ) and inserting section 804(f) of the Community Reinvestment Act of 1977 ( 12 U.S.C. 2903(f) ) . 204. Amendments relating to credit union service to underserved areas (a) In general The Federal Credit Union Act ( 12 U.S.C. 1751 et seq. ) is amended— (1) in section 101 ( 12 U.S.C. 1752 )— (A) in paragraph (8), by striking and at the end; (B) in paragraph (9), by striking the period at the end and inserting ; and ; and (C) by adding at the end the following: (10) the term underserved area — (A) means a local community, neighborhood, or rural district that— (i) is an investment area, as defined in section 103 of the Community Development Banking and Financial Institutions Act of 1994 ( 12 U.S.C. 4702 ), that meets such additional requirements that the Board may impose; and (ii) is underserved, based on data of the Board and the Federal banking agencies (as defined in section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 )), by other depository institutions (as defined in section 19(b)(1)(A) of the Federal Reserve Act ( 12 U.S.C. 461(b)(1)(A) ); and (B) notwithstanding subparagraph (A), includes, with respect to any Federal credit union, any geographic area within which the credit union— (i) has received approval to provide service as an underserved area before the date of enactment of this paragraph from the Administration; and (ii) has established a service facility before that date of enactment. ; (2) in section 106 ( 12 U.S.C. 1756 )— (A) in the first sentence, by striking Federal and inserting (a) Federal ; and (B) by adding at the end the following: (b) The Board shall monitor adherence by a Federal credit union to a significant unmet needs plan submitted under section 109(h) by that Federal credit union that describes how the Federal credit union will serve the deposit and other financial needs of the community. ; and (3) in section 109 ( 12 U.S.C. 1759 )— (A) in subsection (c), by amending paragraph (2) to read as follows: (2) Exception for underserved areas (A) In general Notwithstanding subsection (b), the Board may approve an application by a Federal credit union to allow the membership of the credit union to include any person or organization whose principal residence or place of business is located within a local community, neighborhood, or rural district if— (i) the Board determines— (I) at any time after August 7, 1998, that the local community, neighborhood, or rural district taken into account for purposes of this paragraph is an underserved area; and (II) at the time of the approval, that the credit union is well capitalized or adequately capitalized (as defined in section 216(c)(1)); and (ii) before the end of the 24-month period beginning on the date of the approval, the credit union has established and maintains an ongoing method to provide services in the local community, neighborhood, or rural district. (B) Termination of approval (i) In general Any failure of a Federal credit union to meet the requirement of clause (ii) of subparagraph (A) by the end of the 24-month period referred to in that clause shall constitute a termination, as a matter of law, of any approval of an application under this paragraph by the Board with respect to the membership of the credit union. (ii) Significant unmet needs plan The Board may terminate the approval of an application under this paragraph with respect to the membership of a Federal credit union upon a finding that the credit union is not meeting the terms of the significant unmet needs plan of the credit union submitted under subsection (h)(1). (C) Credit union reporting requirement Any Federal credit union that has an application approved under this paragraph shall, as part of the ordinary course of the examination cycle and supervision process, submit a report to the Administration that includes— (i) the number of members of the credit union who are members by reason of the application; (ii) the number of offices or facilities maintained by the credit union in the local community, neighborhood, or rural district taken into account by the Board in approving the application; and (iii) evidence, as specified by the Board by regulation, demonstrating compliance by the credit union with the significant unmet needs plan submitted by the credit union under subsection (h)(1), as specified by the Administration. (D) Publication by administration The Administration shall publish an annual report containing— (i) a list of all the applications approved under this paragraph before the date on which the report is published; (ii) the number and locations of the underserved areas taken into account in approving those applications; (iii) the total number of members of credit unions who are members by reason of the approval of those applications; and (iv) evidence demonstrating compliance by credit unions with significant unmet needs plans submitted by the credit unions under subsection (h)(1), as specified by the Administration. ; (B) in subsection (e)(2), by inserting subsection (c)(2) and after provided in ; and (C) by adding at the end the following: (h) Additional requirements for community credit unions (1) In general A Federal credit union desiring a field of membership as a credit union described in subsection (b)(3) shall submit to the Board a business plan, which shall include, among other issues, a marketing plan that identifies— (A) the unique needs of the various demographic groups in the proposed community; and (B) how the credit union will market to each group, particularly underserved groups, to address those needs. (2) Public comment and hearing With respect to a Federal credit union desiring a field of membership as a credit union described in subsection (b)(3) for an area with multiple political jurisdictions with a population of not less than 2,500,000, the Administration shall— (A) publish a notice in the Federal Register seeking comment from interested parties about the proposed community; and (B) conduct a public hearing regarding the application of the Federal credit union. . (b) Regulations Not later than 1 year after the date of enactment of this Act, the National Credit Union Administration Board shall issue final regulations to implement the amendments made by subsection (a). 205. Raising public welfare caps (a) National banks The paragraph designated as the Eleventh. of section 5136 of the Revised Statutes of the United States ( 12 U.S.C. 24 ) is amended to read as follows: Eleventh. To make investments directly or indirectly, each of which promotes the public welfare by benefitting primarily low- and moderate-income communities or families (such as by providing housing, services, or jobs). An association shall not make any such investment if the investment would expose the association to unlimited liability. The Comptroller of the Currency shall limit an association's investments in any 1 project and an association’s aggregate investments under this paragraph. Aggregate investments for associations that do not meet the criteria of being well capitalized, as defined in section 24.2(e) of title 12, Code of Federal Regulations, or any successor regulation, under this paragraph shall not exceed an amount equal to the sum of 5 percent of the association’s capital stock actually paid in and unimpaired and 5 percent of the association’s unimpaired surplus fund, unless the Comptroller determines by order that the higher amount will pose no significant risk to the affected deposit insurance fund, and the association is adequately capitalized. In no case shall aggregate investments of an association that do not meet the criteria for being well capitalized under this paragraph exceed an amount equal to the sum of 15 percent of the association’s capital stock actually paid in and unimpaired and 15 percent of the association’s unimpaired surplus fund. Aggregate investments of well capitalized associations, as defined in section 24.2(e) of title 12, Code of Federal Regulations, or any successor regulation, under this paragraph shall not exceed an amount equal to the sum of 15 percent of the association’s capital stock actually paid in and unimpaired and 15 percent of the association’s unimpaired surplus fund, unless the Comptroller determines by order that the higher amount will pose no significant risk to the affected deposit insurance fund. With respect to any association that meets the criteria for being well capitalized, as defined in section 24.2(e) of title 12, Code of Federal Regulations, or any successor regulation, aggregate investments under this paragraph shall not exceed an amount equal to the sum of 25 percent of the association’s capital stock actually paid in and unimpaired and 25 percent of the association’s unimpaired surplus fund. The foregoing standards and limitations apply to investments under this paragraph made by a national bank directly and by its subsidiaries. . (b) Conforming amendments for State member banks The 23rd undesignated paragraph of section 9 of the Federal Reserve Act ( 12 U.S.C. 338a ) is amended to read as follows: A State member bank may make investments directly or indirectly, each of which promotes the public welfare by benefitting primarily low- and moderate-income communities or families (such as by providing housing, services, or jobs), to the extent permissible under State law. A State member bank shall not make any such investment if the investment would expose the State member bank to unlimited liability. Aggregate investments for State member banks that do not meet the criteria of being well capitalized, as defined in section 208.43(b) of title 12, Code of Federal Regulations, or any successor regulation, under this paragraph shall not exceed an amount equal to the sum of 5 percent of the association's capital stock actually paid in and unimpaired and 5 percent of the association’s unimpaired surplus fund, unless the Board determines by order that the higher amount will pose no significant risk to the affected deposit insurance fund, and the association is adequately capitalized. In no case shall aggregate investments of a State member bank that does not meet the criteria for being well capitalized under this paragraph exceed an amount equal to the sum of 15 percent of the association’s capital stock actually paid in and unimpaired and 15 percent of the association’s unimpaired surplus fund. Aggregate investments of well capitalized State member banks, as defined in section 208.43(b) of title 12, Code of Federal Regulations, or any successor regulation, with an examination rating under section 804 of the Community Reinvestment Act of 1977 ( 12 U.S.C. 2903 ) of outstanding or satisfactory , under this paragraph shall not exceed an amount equal to the sum of 15 percent of the State member bank’s capital stock actually paid in and unimpaired and 15 percent of the state member Bank’s unimpaired surplus fund, unless the Board determines by order that the higher amount will pose no significant risk to the affected deposit insurance fund. With respect to any State member bank that meets meet the criteria for being well capitalized as defined in section 208.43(b) of title 12, Code of Federal Regulations, or any successor regulation, with an examination rating under section 804 of the Community Reinvestment Act of 1977 ( 12 U.S.C. 2903 ) of outstanding or satisfactory , aggregate investments under this paragraph shall not exceed an amount equal to the sum of 25 percent of the State member bank’s capital stock actually paid in and unimpaired and 25 percent of the State member bank’s unimpaired surplus fund. The foregoing standards and limitations apply to investments under this paragraph made by a State member bank directly and by its subsidiaries. . 206. Temporary eligibility of certain direct descendants of certain veterans for housing loans guaranteed by the Secretary of Veterans Affairs (a) In general During the period described in subsection (b)— (1) section 3701(b) of title 38, United States Code, shall be applied and administered by adding at the end the following new paragraph: (8) (A) The term veteran also includes, for purposes of home loans, any direct descendant of a veteran described in subparagraph (B) if the descendant— (i) is living on the date of the enactment of the American Housing and Economic Mobility Act of 2025 ; (ii) is a first-time homebuyer; and (iii) is a first-generation homebuyer. (B) A veteran described in this clause is a veteran who— (i) served on active duty at any time during the period between June 22, 1944, and April 11, 1968; (ii) is deceased; and (iii) did not receive a housing loan benefit under this chapter during his or her lifetime. (C) In this paragraph: (i) The term direct descendant includes a legally adopted descendant. (ii) The terms first-generation homebuyer and first-time homebuyer have the meanings given those terms in section 201(a) of the American Housing and Economic Mobility Act of 2025 . ; and (2) section 3702(a)(2) of such title shall be applied and administered by adding at the end the following new subparagraph: (H) Each direct descendant described in section 3701(b)(8) of this title. . (b) Period described The period described in this subsection is the period beginning one year after the date of the enactment of this Act and ending ten years after the date on which the Secretary of Veterans Affairs prescribes the regulations required by subsection (c). (c) Regulations (1) In general Not later than 180 days after the date of the enactment of this Act, the Secretary of Veterans Affairs shall prescribe regulations to carry out this section. (2) Elements The regulations required by paragraph (1) shall provide rules and procedures for determining— (A) the eligibility of a direct descendant for housing loan benefits under this section when the records of the Veterans Benefits Administration are incomplete or otherwise inadequate to verify eligibility; and (B) appropriate implementation of this section if more than one direct descendant of a veteran seeks housing loan benefits under this section. III Removing barriers that isolate communities 301. Expanding rights under the Fair Housing Act (a) Purposes The purposes of the amendments made by this section are— (1) to expand, as well as clarify, confirm, and create greater consistency in, the protections against discrimination on the basis of all covered characteristics; and (2) to provide guidance and notice to individuals, organizations, corporations, and agencies regarding their obligations under Federal law. (b) Amendments to the Fair Housing Act The Fair Housing Act ( 42 U.S.C. 3601 et seq. ) is amended— (1) in section 802 ( 42 U.S.C. 3602 ), by adding at the end the following: (p) Gender identity means the gender-related identity, appearance, or mannerisms or other gender-related characteristics of an individual, regardless of the individual’s designated sex at birth. (q) Marital status has the meaning given the term in section 202.2 of title 12, Code of Federal Regulations, or any successor regulation. (r) Sexual orientation means homosexuality, heterosexuality, or bisexuality. (s) Source of income includes income for which there is a reasonable expectation that the income will continue from— (1) a profession, occupation, or job; (2) any government or private assistance, grant, loan, or rental assistance program, including vouchers issued under the United States Housing Act of 1937 ( 42 U.S.C. 1437 et seq. ); (3) a gift, an inheritance, a pension, an annuity, alimony, child support, or other consideration or benefit; or (4) the sale or pledge of property or an interest in property. (t) Veteran status means— (1) a member of the uniformed services, as defined in section 101 of title 10, United States Code; or (2) a veteran, as defined in section 101 of title 38, United States Code. ; (2) in section 804 ( 42 U.S.C. 3604 )— (A) by inserting actual or perceived before race, color each place that term appears; (B) by striking sex, each place that term appears and inserting sex (including sexual orientation and gender identity), marital status, source of income, veteran status, ; and (C) in subsection (c)— (i) by inserting (1) before To make ; and (ii) by adding at the end the following: (2) Nothing in this title shall be construed to— (A) prohibit a lender from implementing a loan program for veterans or based upon veteran status; or (B) prohibit an entity from providing housing assistance under— (i) section 8(o)(19) of the United States Housing Act of 1937 ( 42 U.S.C. 1437f(o)(19) ); (ii) the Homeless Providers Grant and Per Diem program of the Department of Veterans Affairs; or (iii) any other Federal housing assistance program for veterans or based on veteran status. ; (3) in section 805 ( 42 U.S.C. 3605 )— (A) by inserting actual or perceived before race, color each place that term appears; and (B) by striking sex, each place that term appears and inserting sex (including sexual orientation and gender identity), marital status, source of income, veteran status, ; (4) in section 806 ( 42 U.S.C. 3606 )— (A) by inserting actual or perceived before race, color ; and (B) by striking sex, each place that term appears and inserting sex (including sexual orientation and gender identity), marital status, source of income, veteran status, ; and (5) in section 808(e)(6) ( 42 U.S.C. 3608(e)(6) ), by striking sex, and inserting sex (including sexual orientation and gender identity), marital status, source of income, veteran status, . (c) Prevention of intimidation Section 901 of the Civil Rights Act of 1968 ( 42 U.S.C. 3631 ) is amended— (1) by inserting actual or perceived before race, color each place that term appears; and (2) by striking sex, each place that term appears and inserting sex (including sexual orientation (as such term is defined in section 802 of this Act) and gender identity (as defined in section 802 of this Act)), marital status (as defined in section 802), source of income (as defined in section 802), veteran status (as defined in section 802), . (d) Rule of construction Nothing in the amendments made by this section shall be construed to mean that a particular class of individuals was not protected against discrimination under Federal law as in effect on the day before the date of enactment of this Act. 302. Improving outcomes in housing assistance programs (a) Indian housing assistance Section 502 of the Native American Housing Assistance and Self-Determination Act of 1996 ( 25 U.S.C. 4181 ) is amended by adding at the end the following: (c) Applicability Subsections (a) and (b) shall not apply with respect to tenant-based assistance provided under section 8(o) of the United States Housing Act of 1937 ( 42 U.S.C. 1437f(o) ). . (b) Supplemental administrative fee Section 8(q)(2)(B) of the United States Housing Act of 1937 ( 42 U.S.C. 1437f(q)(2)(B) ) is amended by inserting , including the cost of assisting families with children or families with a member with a disability that move to lower poverty, higher opportunity neighborhoods (as determined by the Secretary based on objective, evidence-based criteria) after programs . (c) Regional planning To increase access to higher opportunity areas 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: (23) Increasing access to higher opportunity areas (A) Location analysis (i) In general A public housing agency that administers the program under this subsection in a metropolitan area shall— (I) analyze the locations where the participants in the program of the public housing agency live; and (II) based on the analysis described in subclause (I), establish policies and practices to reduce disparities and barriers to access to locations throughout the metropolitan area that evidence indicates are more likely to improve outcomes for children or adults. (ii) Considerations The location analysis required under this subparagraph shall— (I) consider separately the locations of families with children, households that include a person with disabilities, and other groups protected under the Fair Housing Act ( 42 U.S.C. 3601 et seq. ); and (II) include an analysis of the locations in relation to dwelling units with rents that are potentially affordable to voucher holders and the likely impact of key neighborhood attributes on their well-being and long-term success, based on Federal and available local data. (iii) Mapping tools The Secretary shall— (I) provide mapping tools and other information necessary for a public housing agency to perform the location analysis under this subparagraph using the demographic data on participating families submitted to the Secretary under part 908 of title 24, Code of Federal Regulations, or any successor regulation; (II) publish a notice in the Federal Register, subject to public comment, that specifies the data sources and definitions that will be incorporated in each mapping tool required under subclause (I); and (III) update the notice required under subclause (II) as needed based on changes in the availability of relevant data or evidence of neighborhood attributes likely to impact the well-being and long-term success of participants in the program under this subsection. (iv) Frequency and availability The location analysis required under this subparagraph shall— (I) be performed by each public housing agency described in clause (i) not less frequently than once every 5 years; (II) be performed by all public housing agencies in a metropolitan area in the same year, as determined by the Secretary; and (III) be made available to the public in a manner that protects the privacy of program participants. (B) Regional policies to increase access to higher opportunity neighborhoods Each public housing agency described in subparagraph (A)(i) shall— (i) consult with other such public housing agencies in the same metropolitan area, or smaller regional area approved by the Secretary, about the possible barriers and other reasons for the disparities identified in the location analysis required under subparagraph (A); (ii) identify policies or practices that those public housing agencies could adopt individually or in collaboration, or other strategies that recipients of grants or other funding from the Secretary could adopt, to reduce the barriers and disparities and increase the share of families with children and other demographic groups using vouchers in higher-opportunity neighborhoods in the metropolitan area or region; and (iii) include in the administrative plan required under section 982.54 of title 24, Code of Federal Regulations, or any successor regulation, the policies that the public housing agency has adopted under this paragraph. (C) Assessment The Secretary shall include public housing agency performance in achieving the goal described in subparagraph (A)(i)(II) in the periodic assessment of agency performance in managing the program under this subsection required under part 985 of title 24, Code of Federal Regulations, or any successor regulation. . (d) Required regulatory changes to public housing agency consortia (1) Definitions In this subsection: (A) Moving to Work demonstration program The term Moving to Work demonstration program means the program established under section 204 of the Departments of Veterans Affairs and Housing and Urban Development, and Independent Agencies Appropriations Act, 1996 ( Public Law 104–134 ; 110 Stat. 1321–281). (B) Public housing agency The term public housing agency has the meaning given the term in section 3(b)(6) of the United States Housing Act of 1937 ( 42 U.S.C. 1437a(b)(6) ). (2) Requirement Not later than 1 year after the date of enactment of this Act, the Secretary of Housing and Urban Development shall establish policies and procedures that— (A) enable public housing agencies that elect to operate in consortia under section 13(a) of the United States Housing Act of 1937 ( 42 U.S.C. 1437k(a) ), excluding public housing agencies participating in the Moving to Work demonstration program— (i) to consolidate their funding contracts for assistance provided under section 8(o) of such Act ( 42 U.S.C. 1437f(o) ) into a single contract; (ii) to consolidate their funding contracts for assistance provided under subsections (d) and (e) of section 9 of such Act ( 42 U.S.C. 1437g ); or (iii) to exercise the consolidation options under each of clauses (i) and (ii); and (B) enable public housing agencies to form partial consortia under such section 13(a) ( 42 U.S.C. 1437k(a) ) that consolidate the administration of certain aspects of their housing programs to increase access to higher-opportunity areas or for other purposes, subject to such requirements as the Secretary may establish. (3) Moving to Work agencies Any flexibility or waiver applicable to the Moving to Work demonstration program shall not apply to any activities or funds administered through a partial consortium formed under paragraph (2)(B) by 1 or more public housing agencies participating in the Moving to Work demonstration program. IV Estate tax reform 401. Amendment to Internal Revenue Code of 1986 Except as otherwise expressly provided, whenever in this title an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986. 402. Rate adjustment (a) Increase in estate tax rates The table contained in section 2001(c) is amended to read as follows: If the amount with respect to which the tentative tax to be computed is: The tentative tax is: Not over $13,000,000 55 percent of such amount. Over $13,000,000 but not over $93,000,000 $7,150,000, plus 60 percent of the excess of such amount over $13,000,000. Over $93,000,000 $55,150,000, plus 65 percent of the excess of such amount over $93,000,000. (b) Reduction of basic exclusion amount Paragraph (3) of section 2010(c) is amended to read as follows: (3) Basic exclusion amount For purposes of this subsection, the basic exclusion amount is $3,500,000. . (c) Surtax on billion dollar estates Section 2001 is amended— (1) in subsection (b), by striking The tax and inserting Subject to subsection (h), the tax , and (2) by adding at the end the following new subsection: (h) Surtax on billion dollar estates (1) In general In the case of a taxable estate for which the applicable amount is in excess of $1,000,000,000, the tax determined under subsection (b) shall be increased by an amount equal to 10 percent of such applicable amount. (2) Applicable amount For purposes of this subsection, the applicable amount shall be equal to the sum of the amounts under subparagraphs (A) and (B) of paragraph (1) of subsection (b) for the taxable estate. . (d) Effective date The amendments made by this section shall apply to estates of decedents dying, and generation-skipping transfers and gifts made, after the date of the enactment of this Act. 403. Required minimum 10-year term, etc., for grantor retained annuity trusts (a) In general Subsection (b) of section 2702 is amended— (1) by redesignating paragraphs (1), (2), and (3) as subparagraphs (A), (B), and (C), respectively, and by moving such subparagraphs (as so redesignated) 2 ems to the right, (2) by striking For purposes of and inserting the following: (1) In general For purposes of , (3) by striking paragraph (1) or (2) in paragraph (1)(C) (as so redesignated) and inserting subparagraph (A) or (B) , and (4) by adding at the end the following new paragraph: (2) Additional requirements with respect to grantor retained annuities For purposes of subsection (a), in the case of an interest described in paragraph (1)(A) (determined without regard to this paragraph) which is retained by the transferor, such interest shall be treated as described in such paragraph only if— (A) the right to receive the fixed amounts referred to in such paragraph is for a term of not less than 10 years, (B) such fixed amounts, when determined on an annual basis, do not decrease relative to any prior year during the first 10 years of the term referred to in subparagraph (A), and (C) the remainder interest has a value equal to or greater than 10 percent of the value of the assets transferred to the trust, determined as of the time of the transfer. . (b) Effective date The amendments made by this section shall apply to transfers made after the date of the enactment of this Act. 404. Certain transfer tax rules applicable to grantor trusts (a) In general Subtitle B is amended by adding at the end the following new chapter: 16 Special rules for grantor trusts Sec. 2901. Application of transfer taxes. 2901. Application of transfer taxes (a) In general In the case of any portion of a trust to which this section applies— (1) the value of the gross estate of the deceased deemed owner of such portion shall include all assets attributable to that portion at the time of the death of such owner, (2) any distribution from such portion to one or more beneficiaries during the life of the deemed owner of such portion shall be treated as a transfer by gift for purposes of chapter 12, and (3) if at any time during the life of the deemed owner of such portion, such owner ceases to be treated as the owner of such portion under subpart E of part 1 of subchapter J of chapter 1, all assets attributable to such portion at such time shall be treated for purposes of chapter 12 as a transfer by gift made by the deemed owner. (b) Portion of trust to which section applies This section shall apply to— (1) the portion of a trust with respect to which the grantor is the deemed owner, and (2) the portion of the trust to which a person who is not the grantor is a deemed owner by reason of the rules of subpart E of part 1 of subchapter J of chapter 1, and such deemed owner engages in a sale, exchange, or comparable transaction with the trust that is disregarded for purposes of subtitle A. For purposes of paragraph (2), the portion of the trust described with respect to a transaction is the portion of the trust attributable to the property received by the trust in such transaction, including all retained income therefrom, appreciation thereon, and reinvestments thereof, net of the amount of consideration received by the deemed owner in such transaction. (c) Exceptions This section shall not apply to— (1) any trust that is includible in the gross estate of the deemed owner (without regard to subsection (a)(1)), and (2) any other type of trust that the Secretary determines by regulations or other guidance does not have as a significant purpose the avoidance of transfer taxes. (d) Deemed owner defined For purposes of this section, the term deemed owner means any person who is treated as the owner of a portion of a trust under subpart E of part 1 of subchapter J of chapter 1. (e) Reduction for taxable gifts to the trust made by owner The amount to which subsection (a) applies shall be reduced by the value of any transfer by gift by the deemed owner to the trust previously taken into account by the deemed owner under chapter 12. (f) Liability for payment of tax Any tax imposed pursuant to subsection (a) shall be a liability of the trust. . (b) Clerical amendment The table of chapters for subtitle B is amended by adding at the end the following new item: Chapter 16. Special rules for grantor trusts . (c) Effective date The amendments made by this section shall apply— (1) to trusts created on or after the date of the enactment of this Act, (2) to any portion of a trust established before the date of the enactment of this Act which is attributable to a contribution made on or after such date, and (3) to any portion of a trust established before the date of the enactment of this Act to which section 2901(a) of the Internal Revenue Code of 1986 (as added by subsection (a)) applies by reason of a transaction described in section 2901(b)(2) of such Code on or after such date. 405. Elimination of generation-skipping transfer tax exemption for transfers to certain persons (a) In general Section 2642 is amended by adding at the end the following new subsection: (h) Elimination of GST exemption for transfers to certain persons (1) In general (A) Transfer to non-exempt person In the case of any direct skip or taxable distribution made to any person who is not an exempt person, the inclusion ratio shall be 1. (B) Taxable termination In the case of any taxable termination which occurs at any time immediately after no exempt person is a beneficiary of the trust, the inclusion ratio shall be 1. (C) Exempt person (i) In general For purposes of this subsection, the term exempt person means— (I) a natural person— (aa) who is assigned to a generation which is 2 or fewer generations below the generation assignment of the transferor, or (bb) whose date of birth precedes the date on which the trust was created, or (II) a trust in which all interests are held by persons described in subclause (I). (ii) Exception For purposes of clause (i)(II), any interest which is used primarily to postpone or avoid the application of this subsection shall be disregarded. (2) Date of creation (A) In general For purposes of determining the date on which a trust was created under paragraph (1)(C)(i)(I)(bb), if the trust was created before January 1, 2026, such trust shall be deemed to have been created on January 1, 2026. (B) Date of creation of pour-over trusts (i) In general In the case of any generation-skipping transfer of property which involves the transfer of property from one trust to another trust, the date of the creation of the transferee trust shall be treated as being the earlier of— (I) the date of the creation of such transferee trust, or (II) the date of the creation of the transferor trust. (ii) Multiple transfers In the case of multiple transfers to which clause (i) applies— (I) the date of the creation of the transferor trust shall be determined under such clause, and (II) subsequent to the determination described in subclause (I), the date of the creation of the transferee trust shall be determined under such clause. (3) Generation assignment For purposes of this subsection, the provisions of section 2653(a) shall not apply. (4) Regulations The Secretary may prescribe such regulations or other guidance as may be necessary or appropriate to carry out this subsection. . (b) Repeal Section 1433(b)(2) of the Tax Reform Act of 1986 ( Public Law 99–514 ) is repealed. (c) Effective dates (1) In general The amendment made by subsection (a) shall take effect on the date of the enactment of this Act. (2) Repeal The amendment made by subsection (b) shall apply to generation-skipping transfers (within the meaning of section 2611 of the Internal Revenue Code of 1986) made after the date of enactment of this Act. 406. Simplifying gift tax exclusion for annual gifts (a) In general Paragraph (1) of section 2503(b) is amended to read as follows: (1) In general (A) Limit per donee In the case of gifts made to any person by the donor during the calendar year, the first $10,000 of such gifts to such person shall not, for purposes of subsection (a), be included in the total amount of gifts made during such year. (B) Cumulative limit per donor (i) In general The aggregate amount excluded under subparagraph (A) with respect to all transfers described in clause (ii) made by the donor during the calendar year shall not exceed twice the dollar amount in effect under such subparagraph for such calendar year. (ii) Transfers subject to limitation The transfers described in this clause are— (I) a transfer in trust, (II) a transfer of an interest in a passthrough entity, (III) a transfer of an interest subject to a prohibition on sale, and (IV) any other transfer of property that, without regard to withdrawal, put, or other such rights in the donee, cannot immediately be liquidated by the donee. . (b) Conforming amendment Section 2503 is amended by striking subsection (c). (c) Regulations The Secretary of the Treasury, or the Secretary of the Treasury's delegate, may prescribe such regulations or other guidance as may be necessary or appropriate to carry out the amendments made by this section. (d) Effective date The amendments made by this section shall apply to any calendar year beginning after the date of the enactment of this Act. 407. Clarification regarding disallowance of step-up in basis for property held in certain grantor trusts (a) In general Section 1014 is amended— (1) by redesignating subsection (f) as subsection (g), and (2) by inserting after subsection (e) the following: (f) Property held in certain grantor trusts This section shall not apply to property— (1) held in a trust of which the transferor is considered the owner under subpart E of part I of subchapter J, and (2) if, after the transfer of such property to the trust, such property is not includible in the gross estate of the transferor for purposes of chapter 11. . (b) Conforming amendment Section 6662(k) is amended by striking 1014(f) and inserting 1014(g) . (c) Effective date The amendments made by this section shall apply to transfers after the date of the enactment of this Act. (d) No inference No inference may be drawn from the amendments made by this section with respect to the application of section 1014 of the Internal Revenue Code of 1986 to property described in subsection (f) of such section (as added by subsection (a)) which was transferred on or before the date of enactment of this Act. 408. Limitation on discounts; valuation rules for certain transfers of nonbusiness assets (a) In general Chapter 14 of subtitle B is amended by adding at the end the following new section: 2705. Limitation on discounts; valuation rules for certain transfers of nonbusiness assets (a) Limitation on discount by reason of family control (1) In general For purposes of this subtitle, in the case of the transfer of any interest in an entity other than an interest which is actively traded (within the meaning of section 1092), if the transferor, the transferee, and members of the family of the transferor and transferee have control of such entity immediately before such transfer, no discount shall be allowed— (A) by reason of the fact that the transferor or transferee does not have control of such entity, (B) by reason of the lack of marketability of the interest, or (C) for any other reason. (2) Definitions In this subsection, the terms control and member of the family have the same meanings given such terms in section 2704(c). (3) Attribution For purposes of this section, the rule of section 2701(e)(3) shall apply for purposes of determining the interests held by any individual. (b) Valuation rules for certain transfers of nonbusiness assets (1) In general For purposes of this subtitle, in the case of the transfer of any interest in an entity other than an interest which is actively traded (within the meaning of section 1092)— (A) the value of any nonbusiness assets held by the entity with respect to such interest shall be determined as if the transferor had transferred such assets directly to the transferee (and no valuation discount shall be allowed with respect to such nonbusiness assets), and (B) such nonbusiness assets shall not be taken into account in determining the value of the interest in the entity. (2) Nonbusiness assets For purposes of this subsection— (A) In general The term nonbusiness asset means any asset other than an asset which is used in the active conduct of a trade or business. (B) Passive assets treated as nonbusiness assets (i) In general For purposes of subparagraph (A), a passive asset shall be treated as a nonbusiness asset unless— (I) the asset is property described in paragraph (1) or (4) of section 1221(a) or is a hedge with respect to such property, or (II) the asset is real property used in the active conduct of 1 or more real property trades or businesses (within the meaning of section 469(c)(7)(C)) in which the transferor materially participates and with respect to which the transferor meets the requirements of section 469(c)(7)(B)(ii). (ii) Material participation For purposes of clause (i)(II), material participation shall be determined under the rules of section 469(h), except that section 469(h)(3) shall be applied without regard to the limitation to farming activity. (C) Working capital treated as used in trade or business Any asset (including a passive asset) which is held as a part of the reasonably required working capital needs of a trade or business shall be treated as used in the active conduct of a trade or business. (3) Passive asset For purposes of this subsection, the term passive asset means any— (A) cash or cash equivalents, (B) stock in a corporation or any other equity, profits, or capital interest in any entity, (C) evidence of indebtedness, option, forward or futures contract, notional principal contract, or derivative, (D) asset described in clause (iii), (iv), or (v) of section 351(e)(1)(B), (E) annuity, (F) real property used in 1 or more real property trades or businesses (as defined in section 469(c)(7)(C)), (G) asset (other than a patent, trademark, or copyright) which produces royalty income, (H) commodity, (I) collectible (within the meaning of section 408(m)), or (J) any other asset specified in regulations prescribed by the Secretary. (4) Look-thru rule (A) In general If a nonbusiness asset of an entity described in paragraph (1) consists of a 10-percent interest in any other entity, this subsection shall be applied by disregarding the 10-percent interest and by treating the entity as holding directly its ratable share of the assets of the other entity. (B) 10-percent interest The term 10-percent interest means— (i) in the case of an interest in a corporation, direct ownership of at least 10 percent (by vote or value) of the stock in such corporation, (ii) in the case of an interest in a partnership, direct ownership of at least 10 percent of the capital or profits interest in the partnership, and (iii) in any other case, direct ownership of at least 10 percent of the beneficial interests in the entity. . (b) Conforming amendments (1) Section 2031(b) of the Internal Revenue Code of 1986 is amended by inserting (after application of section 2705(b)) after shall be determined . (2) The table of sections of chapter 14 of subtitle B of such Code is amended by adding at the end the following: Sec. 2705. Limitation on discounts; valuation rules for certain transfers of nonbusiness assets. . (c) Effective date The amendments made by this section shall apply to transfers after the date of the enactment of this Act. 409. Surcharge on high income estates and trusts (a) In general Subchapter A of chapter 1 is amended by adding at the end the following new part: VIII Surcharge on high income estates and trusts Sec. 59B. Surcharge on high income estates and trusts. 59B. Surcharge on high income estates and trusts (a) General rule In the case of an estate or trust, there is hereby imposed (in addition to any other tax imposed by this subtitle) a tax equal to the sum of— (1) 5 percent of so much of the modified adjusted gross income of the taxpayer as exceeds $200,000, plus (2) 3 percent of so much of the modified adjusted gross income of the taxpayer as exceeds $500,000. (b) Modified adjusted gross income For purposes of this section— (1) In general The term modified adjusted gross income means adjusted gross income reduced by any deduction (not taken into account in determining adjusted gross income) allowed for investment interest (as defined in section 163(d)) or business interest (as defined in section 163(j)). (2) Adjusted gross income Adjusted gross income shall be determined as provided in section 67(e) and reduced by the amount allowed as a deduction under section 642(c). (c) Special rules (1) Charitable trusts Subsection (a) shall not apply to a trust all the unexpired interests in which are devoted to one or more of the purposes described in section 170(c)(2)(B). (2) Not treated as tax imposed by this chapter for certain purposes The tax imposed under this section shall not be treated as tax imposed by this chapter for purposes of determining the amount of any credit under this chapter (other than sections 27 and 901) or for purposes of section 55. (3) Electing small business trusts For purposes of the determination of adjusted gross income, section 641(c)(1)(A) shall not apply and all portions of any electing small business trust shall be treated as a single trust. (d) Regulations The Secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section, including regulations or other guidance to prevent the avoidance of the purposes of this section. . (b) Coordination with certain provisions (1) Interest on certain deferred tax liability Section 453A(c) is amended by redesignating paragraph (6) as paragraph (7) and by inserting after paragraph (5) the following new paragraph: (6) Surcharge on high income estates and trusts taken into account in determining maximum rate of tax For purposes of paragraph (3)(B), in the case of an estate or trust, the maximum rate of tax in effect under section 1 shall be treated as being equal to the sum of such rate and the rates in effect under paragraphs (1) and (2) of section 59B(a). . (2) Limitation on foreign tax credit (A) Section 904(b)(3)(E)(i)(I) is amended by inserting increased, in the case of an estate or trust, by the sum of the rates set forth in paragraphs (1) and (2) of section 1A(a) after (whichever applies) . (B) Section 904(d)(2)(F) is amended by adding at the end the following: For purposes of the first sentence of this subparagraph, in the case of an estate or trust, the highest rate of tax specified in section 1 shall be treated as being equal to the sum of such rate and the rates in effect under paragraphs (1) and (2) of section 59B(a). . (3) Election by individuals to be subject to tax at corporate rates Section 962(a)(1) is amended by striking and 55 and inserting 55 , and 59B . (4) Interest on certain tax deferral Section 1291(c)(2) is amended by adding at the end the following: For purposes of the preceding sentence, in the case of an estate or trust, the highest rate of tax in effect under section 1 shall be treated as being equal to the sum of such rate and the rates in effect under paragraphs (1) and (2) of section 59B(a). . (5) Withholding of tax on foreign partners’ share of effectively connected income Section 1446(b)(2) is amended by adding at the end the following flush sentence: For purposes of subparagraph (A), in the case of a partner which is an estate or trust, the highest rate of tax in effect under section 1 shall be treated as being equal to the sum of such rate and the rates in effect under paragraphs (1) and (2) of section 59B(a). . (6) Partnership adjustments (A) Section 6225(b)(1) is amended by adding at the end the following flush sentence: For purposes of subparagraph (B), in the case of an estate or trust, the highest rate of tax in effect under section 1 shall be treated as being equal to the sum of such rate and the rates in effect under paragraphs (1) and (2) of section 59B(a). . (B) Section 6225(c)(4)(A) is amended— (i) by striking subsection (b)(1)(A) and inserting subsection (b)(1)(B) , and (ii) by striking or at the end of clause (i), by adding or at the end of clause (ii), and by inserting after clause (ii) the following new clause: (iii) is not an estate or trust subject to one or both of the rates of tax in effect under paragraphs (1) and (2) of section 59B(a), . (7) Required payments for entities electing not to have required taxable year The second sentence of section 7519(b) is amended by inserting and, in the case of an estate or trust, increased by the sum of the rates in effect under paragraphs (1) and (2) of section 59B(a) before the period at the end. (c) Clerical amendment The table of parts for subchapter A of chapter 1 is amended by adding at the end the following new item: PART VIII—Surcharge on high income estates and trusts . (d) Effective date The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act. 410. Modification of rules for value of certain farm, etc., real property (a) In general Paragraph (2) of section 2032A(a) of the Internal Revenue Code of 1986 is amended by striking $750,000 and inserting $3,000,000 . (b) Inflation adjustment Paragraph (3) of section 2032A(a) of such Code is amended— (1) by striking 1998 and inserting 2026 , (2) by striking $750,000 each place it appears and inserting $3,000,000 , and (3) by striking calendar year 1997 and inserting calendar year 2025 in subparagraph (B). (c) Effective date The amendments made by this section shall apply to estates of decedents dying, and gifts made, after December 31, 2025. 411. Modification of estate tax rules with respect to land subject to conservation easements (a) Modification of exclusion limitation Subparagraph (B) of section 2031(c)(1) of the Internal Revenue Code of 1986 is amended by striking $500,000 and inserting $2,000,000 . (b) Modification of applicable percentage Paragraph (2) of section 2031(c) of the Internal Revenue Code of 1986 is amended by striking 40 percent and inserting 60 percent . (c) Effective date The amendments made by this section shall apply to estates of decedents dying, and gifts made, after December 31, 2025. V Accessibility requirements 501. Accessibility requirements In the case of housing that is constructed, altered, or otherwise assisted using amounts made available to the Secretary of Housing and Urban Development under this Act or an amendment made by this Act, sections 8.22 and 8.23 of title 24, Code of Federal Regulations (or any successor regulations) shall be applied such that the number of dwelling units required to be accessible under those sections is twice the number that would otherwise be required to be accessible under those sections.