HUD Demonstration Act of 1993
PL 103-120 (H.R.2517), enacted 10/27/1993

107 STAT. 1144 
PUBLIC LAW 103-120—OCT. 27, 1993 
Public Law 108-120 
103d Congress 
Oct. 27, 1993 
[H.R. 2517] 
HUD 
Demonstration 
Act of 1993. 
42 use 11301 
note. 
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note. 
Grants. 
An Act 
To enable the Secretary of Housing and Urban Development to demonstrate innova-
tive strategies for assisting homeless individuals, to develop the capacity of commu-
nity development corporations and community housing development organizations 
to undertake community development and affordable housing projects and pro-
grams, to encourage pension faad investment in affordable housing, and for 
other purposes. 
Be it enacted by the Senate and House of Representatives of 
the United States of 
America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the "HUD Demonstration Act of 
1993". 
SEC. 2. INNOVATIVE HOMELESS INITIATIVES DEMONSTRATION PRO-
GRAM. 
(a) PURPOSE.—^The purpose of this section is to enable the 
Secretary of Housing and Urban Development (hereafter in this 
Act referred to as the "Secretary"), through cooperative efforts in 
partnership with other levels of government and the private sector, 
including nonprofit organizations, foimdations, and communities, 
to demonstrate methods of undertaking comprehensive strategies 
for assisting homeless individuals and families (including homeless 
individuals who have AIDS or who are infected with HIV), through 
a variety of activities, including the coordination of efforts and 
the filling of gaps in available services and resources. In carrying 
out the demonstration, the Secretary shall— 
(1) provide comprehensive homeless demonstration grants 
under subsection (c); and 
(2) provide innovative project funding luider subsection 
(d). 
(b) DEFINITIONS.—For purposes of this section, the following 
definitions shall apply: 
(1) HOMELESS INDIVIDUAL.—The term "homeless individual" 
has the meaning given such term in section 103 of the Stewart 
B. McKinney Homeless Assistance Act. 
(2) HOMELESS FAMILY.—The term "homeless family" means 
a group of one or more related individuals who are homeless 
individuals. 
(3) 
INCORPORATED 
DEFINITIONS.—The terms 
"State", 
. "metropolitan city", "urban county", "unit of general local 
government", and "Indian tribe" have the meanings given such 
terms in section 102(a) of the Housing and Community Develop-
ment Act of 1974. 
PUBLIC LAW 103-120—OCT. 27, 1993 
107 STAT. 1145 
(4) JURISDICTION.—The term "jurisdiction" means a State, 
metropolitan city, urban coimty, unit of general local govern-
ment (including unit£t in rural areas), or Indian tribe. 
(5) 
NONPROFIT 
ORGANIZATION.—The term 
"nonprofit 
organization" means an oi^anization— 
(A) no part of the net earnings of which inures to 
the benefit of any member, foimder, contributor, or individ-
ual; 
(B) that, in the case of a private nonprofit organization, 
has a voluntary l)oard; 
(C) that has an accountinjsf system, or has designated 
a fiscal agent in accordance with requirements established 
by the Secretsuy; and 
(D) that practices nondiscrimination in the provision 
of assistance. 
(6) VERY LOW-INCOME FAMIUES.—The term "very low-
income families" has the meaning given such term in section 
3 of the United States Housing Act of 1937. 
(c) COMPREHENSIVE HOMELESS INITIATIVE.— 
(1) DESIGNATION.—^The Secretary shall designate such 
jurisdictions as the Secretary may determine for comprehensive 
homeless initiative funding imder this subsection. 
(2) AUTHORITY.—^The Secretary may provide assistance 
under this subsection to— 
(A) jurisdictions designated under paragraph (1) (or 
entities or instrumentalities established imder the author-
ity of such jurisdictions); or 
(B) nonprofit organizations operating within such juris-
dictions, 
establish comprehensive homeless initiatives to carry out the 
purpose of this section. 
(3) CRITERIA.—^llie Secretary shall establish criteria for 
designating jurisdictions under paragraph (1), which shall 
include— 
(A) the extent of homelessness in the jurisdiction; 
(B) the extent to which the existing public and private 
svstems for homelessness prevention, outreach, assessment, 
shelter, services, transitional services, transitional housing, 
and permanent housing available within the jurisdiction 
would benefit from additional resources to achieve a com-
prehensive approach to meeting the needs of individuals 
and families who are homeless or who are very low-income 
and at risk of homelessness; 
(C) the demonstrated willingness and capacity of the 
jurisdiction to work cooperatively with the Department of 
Housing and Urban Development (hereafter in this Act 
referred to as the "Department"), nonprofit organizations, 
foundations, other private entities, and the community to 
desi^ and implement an initiative to achieve the purposes 
of this subsection; 
(D) the demonstrated willingness of nongovernmental 
org£uiizations to commit financial and other resources to 
a comprehensive homeless initiative in the jurisdiction; 
(E) the commitment of the jurisdiction to make nec-
essary changes in policy and procedure to provide sufficient 
flexibility and resources as necessary to implement and 
sustain the initiative; 
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107 STAT. 1146 
PUBLIC LAW 103-120—OCT. 27, 1993 
(F) national geographic diversity in the designation 
of 
jurisdiction; and 
(G) such other factors as the Secretary determines 
to be appropriate. 
(4) CONSULTATION.—^Prior to designating jurisdictions 
under paragraph (1), the Secretary shall consult with the 
Committee on Banking, Finance and Urban Affairs of the House 
of Representatives and the Committee on Banking, Housing, 
and Urban Affairs of the Senate regarding such designations. 
(5) COMPREHENSIVE STRATEGY.—^Recipients of assistance 
under this subsection shall, in cooperation with the Secretary, 
other governmental entities, nonprofit organizations, foimda-
tions, other private entities, and the commimity, develop a 
comprehensive plan that— 
(A) sets forth a realistic and feasible strategy that 
cont£dns specific projects and activities to carry out the 
purpose of this section; 
(B) demonstrates the willingness of the appropriate 
government and private entities and other parties to 
participate cooperatively in this plan; 
(C) specifies the projects and activities to be funded 
under this subsection; 
(D) provides an estimate of the cost of implementing 
the initiative funded under this subsection; 
(E) enumerates amounts to be made available to fund 
the comprehensive homeless initiative by participating 
governmental entities, nonprofit organizations, founda-
tions, and the community, as appropriate, and requests 
funds from the Secretary pursuant to this subsection; and 
(F) provides such other information as the Secretary 
determines to be appropriate. 
(6) DESIGNATION.—^The designation referred to in para-
graph (1) and assistance provided under paragraph (2) shall 
be made on a noncompetitive basis. 
(d) INNOVATIVE PROJECT FUNDING.— 
(1) AUTHORITY.—^The Secretary is authorized to provide 
assistance under this subsection to jurisdictions and nonprofit 
organizations operating within such jurisdictions to establish 
innovative programs to carry out the piupose of this section. 
(2) APPLICATIONS.—^AppUcations for assistance imder this 
subsection shall be in such form, and shall include such 
information, as the Secretary shall determine. Each application 
shall include— 
(A) a description of the extent of homelessness in the 
jiirisdiction; 
(B) an explanation of the extent to which the existing 
systems, both public and private, for homelessness preven-
tion, outreach, assessment, shelter, services, transitional 
services, transitional housing, and permanent housing 
available within the jurisdiction woula benefit from addi-
tional resources to achieve a comprehensive approach to 
meeting the needs of individuals and families who are 
homeless, or who are very low-income and at risk of 
homelessness; 
(C) a description of the projects and activities for which 
the applicant is requesting funding imder this subsection 
and tne amounts requested; 
PUBLIC LAW 103-120—OCT. 27, 1993 
107 STAT. 1147 
(D) the demonstrated willingness and capacity of the 
jiirisdiction to work cooperatively with the Department, 
nonprofit organizations, foundations, other private entities, 
and the community, to the extent feasible, to design and 
implement an initiative to achieve the purposes of this 
subsection; 
(E) a statement of commitment from the jurisdiction 
to make necessary changes in policy and procedure to pro-
vide sufficient flexibility and resources as necessary to 
implement and sustain the program; and 
(F) such other information as the Secretary determines 
to be appropriate. 
(3) CRITERIA,—^The Secretary shall estabUsh selection cri-
teria for awarding assistance under this subsection, which shall 
include— 
(A) the extent to which the program described in the 
application achieves the purpose of this section; 
(B) the extent to which the applicant demonstrates 
the capacity to implement a program that achieves the 
purpose of this section; 
(C) the extent to which the program described in the 
application is innovative and may be replicated or may 
serve as a model for implementation in other jurisdictions; 
(D) diversity by geography and community tjrpe; and 
(E) such other criteria as the Secretary determines 
to be appropriate. 
(e) REPORTS.— 
(1) RECIPIENTS OF FUNDS.—^Each recipient of fimds imder 
subsections (c) and (d) shall submit to the Secretary a report 
or series of reports, in a form and at a time specified by 
the Secretary. Each report shall— 
(A) describe the use of funds made available under 
this section; and 
(B) include a description and an analysis of the pro-
grams and projects fiinded, the innovative approaches 
taken, and the level of cooperation among participating 
parties. 
(2) INTERIM HUD REPORT.—^The Secretary shall submit to 
the Congress, in conjimction with the 1995 legislative rec-
ommendations of the Department, a report describing the 
results of the demonstration program fiinded under this section 
to date. The report shall contain a summary and analysis 
of all information contained in any reports received by the 
Secretary pursuant to paragraph (1) and shall contain rec-
ommendations for fiiture action. 
(3) FINAL HUD REPORT.—Not later than 3 months afl»r 
all recipient reports have been submitted under paragraph 
(1), the Secretary shall submit to the Congress a final report. 
The Secretary's final report shall contain a summary &nd analy-
sis of all information contained in the reports received by 
the Secretary pursuant to paragraph (1) and shall contain 
recommendations for fiiture action. 
(0 AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated $200,000,000 for fiscal year 1994 to carry out 
this section. Of the amounts appropriated pursuant to this sub-
section, not less than 25 percent shall be used to carry out innova-
107 STAT. 1148 
PUBLIC LAW 103-120—OCT. 27, 1993 
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note. 
Effective date. 
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note. 
tive project funding under subsection (d). All funds shall remain 
available until expended. 
(g) REPEAL.—^This section shall be repealed effective on Octo-
ber 1,1994. 
SEC. 3. MOVING TO OPPORTUNITIES. 
Section 152(e) of the Housing and Community Development 
Act of 1992 (42 U.S.C. 1437f note) is amended in the first sentence 
by striking "$52,100,000" and inserting "$165,000,000". 
SEC. 4. CAPACITY BUILDING FOR COMMUNITY DEVELOPMENT AND 
AFFORDABLE HOUSING. 
(a) IN GENERAL.—^The Secretary is authorized to provide assist-
ance tjirough the National Community Development Initiative to 
develop the capacity and abiUty of community development corpora-
tions and community housing development organizations to under-
take community development and anordable hoiising projects and 
programs. 
(b) FORM OF ASSISTANCE.—Assistance under this section may 
be used for— 
(1) training, education, support, and advice to enhance 
the technical and administrative capabilities of community 
development corporations and community housing development 
organizations; 
(2) loans, grants, or predevelopment assistance to commu-
nity development corporations and community housing develop-
ment organizations to carry out community development and 
affordable housing activities that benefit low-income families; 
and 
(3) such other activities as may be determined by the 
National Commimity Development Initiative in consultation 
with the Secretary. 
(c) MATCHING REQUIREMENT.—Assistance provided under this 
section shall be matched from private sources in an amount equal 
to 3 times the amount made available under this section. 
(d) IMPLEMENTATION.—The Secretary shall by notice establish 
such requirements as may be necessary to carry out the provisions 
of this section. The notice shall take effect upon issuance. 
(e) AUTHORIZATION.—^There are authorized to be appropriated 
$25,000,000 for fiscal year 1994 to carry out this section. 
SEC. 5. AUTHORIZATION FOR COMMUNITY HOUSING PARTNERSHIPS 
AND SUPPORT FOR STATE AND LOCAL HOUSING STRATE-
GIES. 
Section 205 of the Cranston-Gonzalez National Affordable Hous-
ing Act (12 U.S.C. 12724) is amended— 
(1) in paragraph (1), by striking "$14,000,000 for fiscal 
year 1994" and inserting "$25,000,000 for fiscal year 1994"; 
and 
(2) in paragraph (2), by striking "$11,000,000 for fiscal 
year 1994" and inserting "$22,000,000 for fiscal year 1994". 
SEC. 6. SECTION 8 COMMUNITY INVESTMENT DEMONSTRATION PRO-
GRAM. 
(a) DEMONSTRATION PROGRAM.—The Secretary shall carry out 
a demonstration program to attract pension fund investment in 
affordable housing through the use of project-based rental assist-
ance under section 8 of the United States Housing Act of 1937. 
PUBLIC LAW 103-120—OCT. 27, 1993 
107 STAT. 1149 
(b) FUNDING REQUIREMENTS.—^In canying out this section, the 
Secretary shall ensure that not less tiian 50 percent of the funds 
appropriated for the demonstration program each year are used 
in coi\junction with the disposition of either— 
(1) multifamily properties owned by the Department; or 
(2) multifamily properties securing mortgages held by the 
Department. 
(c) CONTRACT TERMS.— 
(1) IN GENERAL.—^Project-based assistance under this sec-
tion shall be provided pursuant to a contract entered into 
by the Secretary and tlie owner of the eligible housing that— 
(A) provides assistance for a term of not less than 
60 months and not greater than 180 months; and 
(B) provides for contract rents, to be determined by 
the Secretary, which shall not exceed contract rents per-
mitted under section 8 of the United States Housing Act 
of 1937, taking into consideration any costs for the 
construction, rehabilitation, or acquisition of the housing. 
(2) AMENDMENT TO SECTION 203.—Section 203 of the Hous-
ing and Community Development Amendments of 1978 (12 
U.S.C. 1701Z-11) is amended by adding at the end the following 
new subsection: 
"(1) Project-based assistance in connection with the disposition 
of a multifamily housing project may be provided for a contract 
term of less than 15 years if such assistance is provided— 
"(1) under a contract authorized under section 6 of the 
HUD Demonstration Act of 1993; and 
"(2) pursuant to a disposition plan under this section for 
a project that is determined by the Secretary to be otherwise 
in compliance with this section. . 
(d) LIMITATION.—(1) The Secretary may not provide (or make 
a commitment to provide) more than 50 percent of the funding 
for housing financed by any single pension fund, except that this 
limitation shall not ajpply if the Secretaiy, after the end of the 
6-month period beginning on the date notice is issued under sub-
section (e)— 
(A) determines that— 
(i) there are no expressions of interest that are likely 
to result in approvable applications in the reasonably 
foreseeable future; or 
(ii) any such expressions of interest are not likely to 
use all funding under this section; and 
(B) so informs the Committee on Banking, Finance and 
Urban Affairs of the House of Representatives and the Commit-
tee on Banking, Housing, and Urban Affairs of the Senate. 
(2) If the Secretary determines that there are expressions of 
interest referred to in paragraph (IXAXii), the Secretary may 
reserve funding sufficient in the Secretarsr's determination to fund 
such applications and may use any remaining funding for other 
pension funds in accordance with this section. 
(e) IMPLEMENTATION.—The Secretary shall by notice establish 
such requirements as may be necessary to cany out the provisions 
of this section. The notice shall take effect upon issuance. 
Effective date. 
(0 APPUCABILITY OF ERISA—Notwithstonding section 514(d) 
of the Employee Retirement Income Security Act of 1974, nothing 
in this section shall be construed to authorize any action or failure 
to act that would constitute a violation of such Act. 
107 STAT. 1150 
PUBLIC LAW 103-120—OCT. 27, 1993 
(g) REPORT.—^Not later than 3 months after the last day of 
each fiscal year, the Secretary shall submit to the Committee on 
Banking, Finance and Urban Affairs of the House of Representa-
tives and the Committee on Banking, Housing, and Urban Affairs 
of the Senate a report summarizing the activities carried out under 
this section diuing that fiscal year. 
(h) ESTABLISHMENT OF STANDARDS.—Mortgages secured by 
housing assisted under this demonstration shall meet such stand-
ards regarding financing and securitization as the Secretary may 
establish. 
Reports. 
(i) GAO STUDY.—The Comptroller General of the United States 
shall conduct a study evaluating the demonstration authorized 
imder this section and shall report its findings to the Committee 
on Banking, Finance and Urban Affairs of the House of Representa-
tives £ind the Committee on Banking, Housing, and Urban Affairs 
of the Senate not later than 3 months after the conclusion of 
the demonstration. 
(j) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated $100,000,000 for fiscal year 1994 to carry out 
this section. 
(k) TERMINATION DATE.—The Secretary shall not enter into 
any new commitment to provide assistance under this section after 
September 30,1998. 
SEC. 7. NATIONAL COMMISSION ON MANUFACTURED HOUSING. 
(a) EXTENSION OF COMMISSION.—Section 943(g) of the Cranston-
Gonzalez National Affordable Housing Act (Public Law 101-625; 
104 Stat. 4415) is amended by striking "on October 1, 1993" and 
inserting "on October 1,1994". 
(b) FINAL REPORT.—Section 943(dX2) of the Cranston-Gonzalez 
National Affordable Housing Act (Public Law 101-625; 104 Stat. 
4414) is amended by striking "9 months after the Commission 
is established piirsuant to subsection (b)" and inserting "August 
1,1994". 
(c) INTERIM REPORT.—Section 943(d) of the Cranston-Gonzalez 
National Affordable Housing Act (Public Law 101-625; 104 Stat. 
4414) is amended— 
(1) by redesignating paragraph (2) (as amended by sub-
section (b) of this section) as paragraph (3); and 
(2) by inserting after paragraph (1) the following new para-
graph: 
"(2) INTERIM REPORT.—Not later than March 1, 1994, the 
Commission shall submit an interim report to the Secretary 
and the Congress. The report shall describe the activities of 
the Commission imder paragraph (1) and shall contain any 
information specified in such paragraph that is available to 
the Commission and any evaluations and recommendations 
specified in such paragraph that may be made by the Commis-
sion, at such time.". 
(d) AUTHORIZATION OF APPROPRIATIONS.—Section 943(f) of the 
Cranston-Gonzalez National Affordable Housing Act (Public Law 
101-625; 104 Stat. 4415) is amended by inserting after the first 
sentence the following new sentence: "There are authorized to be 
appropriated for fiscal year 1994 such sums as may be necessary 
to carry out this section.". 
PUBLIC LAW 103-120—OCT. 27, 1993 
107 STAT. 1151 
42 u s e 1490o. 
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note. 
42 u s e 1437f 
note. 
SEC. 8. RECIPROCnY IN APPROVAL OF HOUSING SUBDIVISIONS 
AMONG FEDERAL AGENCIES. 
(a) EXTENSION OF AUTHORITY.—Section 535(b) of the Hoxising 
Act of 1949 (42 U.S.C. 1490o(b)) is amended by striking "June 
15,1993" and inserting "September 30,1994". 
(b) RETROACTIVITY.—An administrative approval of a housing 
subdivision made after June 15, 1993, and before the date of the 
enactment of this Act is approved and shall be considered to have 
been lawfully made, but only if otherwise made in accordance 
with the provisions of section 535(b) of the Housing Act of 1949. 
SEC. 9. FHA INSURANCE AUTHORITY. 
Section 531(b) of the National Housing Act (12 U.S.C. 1735f-
9(b)) is amended by striking "$65,905,824,960" and inserting 
"$110,165,000,000". 
SEC. 10. GNMA GUARANTEE AUTHORITY. 
Section 306(gX2) of the National Housing Act (12 U.S.C. 
1721(gX2)) is amended by striking "$88,000,000,000" and inserting 
"$107,700,000,000". 
SEC. 11. ADMINISTRATION OF SECTION 8 PROGRAM. 
(a) ADMINISTRATIVE FEE.—^Notwithstanding the second sentence 
of section 8(qXl) of the United States Housing Act of 1937, other 
applicable law, or anv implementing regulations and related 
requirements, the fee ror the ongoing costs of administering the 
certificate and housing voucher programs under subsections (b) 
and (o) of section 8 of such Act during fiscal year 1994 shall 
be^ 
(1) not less than a fee calculated in accordance with the 
fair market rents for Federal fiscal year 1993; or 
(2) not more than— 
(A) a fee calciilated in accordance with section 8(q) 
of such Act, except that such fee shall not be in excess 
of 3.5 percent above the fee calculated in accordance with 
paran>aph (1); or 
(B) to the extent approved in an appropriation Act, 
a fee calculated in accordance with such section 8(q). 
(b) STUDY.— 
(1) IN G
E
N
E
R
A
L
.
—
^
T
h
e Secretary shall conduct a study 
assessing the costs incurred by public housing agencies in 
administering the voucher and certificate programs under sub-
sections (b) and (o) of section 8 of the United States Housing 
Act of 1937. 
(2) SPECIFIC REQUIREMENTS.—The study conducted under 
this subsection shall— 
(A) take into account variances in costs attributable 
to the geographic area, the tenant population, and the 
number of units covered by a public housing agency; and 
(B) include an analysis of the costs associated with 
Federal mandates, such as the family self-sufficiency pro-
gram, and such other factors that the Secretary determines 
to be appropriate. 
(3) SUBMISSION T
O CONGRESS.—The Secretary shall submit Reports 
to the Congress a report containing the results of the study 
conducted imder this subsection in coi^junction with the Depart-
ment of Housing and Urban Development's 1994 legislative 
recommendations. 
107 STAT. 1152 
PUBLIC LAW 103-120—OCT. 27, 1993 
SEC. 12. AMENDMENTS TO PUBUC LAW 102-389. 
(a) EXTENSION OF TIME.—Subject to appropriations made in 
advance in an appropriations Act, title II of the Departments of 
Veterans Affairs and Housing and Urban Development, and 
Independent Agencies Appropriations Act, 1993 (Public Law 102-
1
0
6 Stat. 1590. 
389), is amended under the heading "Administrative Provisions" 
in the second undesignated paragraph by striking "October 1, 1993" 
and inserting "October 1,1994". 
(b) PROJECT-BASED ASSISTANCE.—Title II of the Departments 
of Veterans Affairs and Housing and Urban Development, and 
Independent Agencies Appropriations Act, 1993 (Public Law 102-
1
0
6 Stat. 1591. 
389), is amended under the heading "Administrative Provisions" 
in the ninth iindesignated paragraph by inserting "(which may 
be project-based assistance)" after "36 units". 
Approved October 27, 1993. 
LEGISLATIVE HISTORY—H.R. 2517: 
CONGRESSIONAL RECORD, Vol. 139 (1993): 
June 28, considered and passed House. 
Sept. 23, considered and passed Senate, amended. 
Oct. 6, House concurred in Senate amendments.