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SECTION 1. SHORT TITLE.

This Act may be cited as the ''Section 3 Modernization and
Improvement Act of 2015''.

SEC. 2. CONGRESSIONAL FINDINGS.

The Congress finds that--
(1) funds administered by the Department of Housing and
Urban Development, particularly those intended for housing
construction, rehabilitation, repair, modernization,
management, self-sufficiency, community development, and other
public construction, provide State and local governments,
housing providers, and other recipients of this Federal
financial assistance with substantial funds for projects and
activities that produce significant economic opportunities for
the communities where the funds are expended;
(2) low- and very low-income persons, especially recipients
of government assistance for housing, often face barriers to
access training, employment, and contracting opportunities
resulting from the expenditure of Federal funds in their
communities;
(3) training, employment, and contracting opportunities
generated by projects and activities that receive assistance
from the Department of Housing and Urban Development offer an
effective means of empowering low- and very low-income persons
and local businesses that provide training and job
opportunities for such persons;
(4) past Federal efforts to direct training, employment,
and contracting opportunities generated by programs
administered by the Secretary of Housing and Urban Development
to low- and very low-income persons, and businesses that
provide training and job opportunities for such persons, have
not been fully effective and should be intensified; and
(5) funding provided to other Federal agencies may also
produce significant employment and contracting opportunities
for the communities where the funds are expended.

SEC. 3. REPORTING; SANCTIONS FOR NONCOMPLIANCE.

Section 3 of the Housing and Urban Development Act of 1968 (12
U.S.C. 1701u) is amended--
(1) by redesignating subsection (g) as subsection (k); and
(2) by inserting after subsection (f) the following new
subsections:
''(g) Reports.--
''(1) Recipient reports to hud.--
''(A) Requirement.--Each recipient of assistance
referred to in subsection (c) or (d) (in this section
referred to as a 'recipient') shall report annually to
the Secretary on their compliance with the employment
and contracting requirements and on their contractors
and subcontractors performance. Recipients shall ensure
that their contractors and subcontractors provide them
with any information necessary to make such reports.
''(B) Information regarding failure to meet
employment and contracting requirement.--For any period
during which a recipient, or their contractor or
subcontractor, did not meet their employment or
contracting requirement under subsection (c) or (d),
the report shall describe actions that were taken to
meet the requirement, including actions taken or that
will be taken in future funding opportunities to
address the deficiencies in the actions that resulted
in failure to meet employment and contracting
requirements.
''(C) Monthly reports by subrecipients.--Each
recipient shall require any entity that is a
subrecipient of such recipient for assistance referred
to in subsection (c) or (d) to submit a report to such
recipient monthly containing such information as the
Secretary shall require to ensure that the recipient
can comply with this paragraph.
''(D) Public availability.--Each report pursuant to
this paragraph (including reports under subparagraph
(C)) shall be made publicly available, in its entirety,
not later than 15 business days after the end of the
period covered by the report. Such availability shall
include posting reports on a publicly accessible
website on the World Wide Web and making printed and
electronic copies publicly available upon request at no
charge.
''(2) Annual hud reports to congress.--
''(A) Requirement.--The Secretary shall submit a
report annually to the Congress that provides a summary
of the information contained in the reports submitted
pursuant to paragraph (1). Such annual report shall
provide information on the total amount of Federal
funds that are subject to this section, by program area
and geographical jurisdiction, and the outcomes
produced, including specific information on the amount
of training, jobs, and contracting opportunities
generated by such funds.
''(B) Assessment of noncompliance.--Each report
under this paragraph shall include--
''(i) an assessment of any noncompliance by
any recipients with the requirements of this
section, by State;
''(ii) specific recommendations regarding
actions to reduce and eliminate such
noncompliance; and
''(iii) any sanctions imposed pursuant to
subsection (h) for such noncompliance.
''(C) Review of effectiveness.--Each report under
this paragraph shall include a review of the
effectiveness of the program under this section in
providing jobs for low- and very low-income persons,
meeting unmet training and job readiness needs in the
community, enabling low- and very low-income persons to
hold a steady job, providing contracting opportunities
for businesses that qualify for priority under
paragraphs (1)(B) and (2)(B) of subsection (d), and any
recommendations the Secretary determines appropriate
regarding the program under this section.
''(3) GAO report.--Not later than the expiration of the
two-year period beginning on the date of the enactment of the
Section 3 Modernization and Improvement Act of 2015, the
Comptroller General of the United States shall submit a report
to the Congress regarding the implementation of this section
(as amended by such Act), that--
''(A) specifically describes the extent of
compliance with this section, the amount of funds
awarded that were covered by this section, and
outcomes; and
''(B) makes recommendations to improve the
effectiveness of this section and for when a subsequent
such report should be required.
''(h) Noncompliance.--
''(1) Investigation and determination.--In carrying out
this section, the Secretary shall develop and implement
procedures to assess compliance with the requirements of this
section, to review complaints alleging noncompliance by any
recipient or contractor with the requirements of this section,
to make determinations as to whether such noncompliance has
occurred, and to take such actions as provided in this
subsection as the Secretary determines appropriate to ensure
compliance and prevent future noncompliance.
''(2) Timely assessment.--The procedures required under
paragraph (1) shall include measures that ensure that
recipients and contractors are in compliance with the
requirements of this section during the use of assistance
referred to in subsection (c) or (d), including a requirement
to report to the Secretary regarding compliance on a monthly
basis and a requirement that the Secretary assess compliance by
each recipient and contractor not less frequently than once
every 3 months.
''(3) Sanctions.--
''(A) Establishment.--The Secretary shall develop
and implement policies and procedures for imposition of
a series of administrative sanctions, graduated in
severity, which shall be applied to recipients and
their contractors and subcontractors that are
determined do not comply with this section or the
requirements established under the program under this
section.
''(B) Automatic sanctions.--Such sanctions shall
include certain measures, or a series of measures, that
are applied in all instances of a determination of a
failure to comply with certain requirements of this
section or with certain requirements established under
this program under this section, and shall not be
subject to any discretion on the part of the Secretary
as to whether to apply such measure or measures.
''(C) Actions.--Such sanctions shall include--
''(i) requiring a recipient to enter into a
compliance agreement with the Secretary is
specifically designed to bring the recipient
into compliance and provide for the creation of
additional employment opportunities and, if
such recipient refuses to enter into such
agreement, recapture by the Secretary, from
amounts provided to the recipient that were
subject to this section, of an amount equal to
the amount that was required under this section
to be used to give low- and very low-income
persons training and employment opportunities
or economic opportunities but was not so used;
''(ii) reduction of future funds from the
Department, including any discretionary funds
available under the Choice Neighborhoods
Initiative under section 24 of the United
States Housing Act of 1937 (42 U.S.C. 1437v)
and the rental assistance demonstration program
(as such term is defined in subsection (e) of
this section);
''(iii) debarment and suspension from, and
limited denial of participation in programs of
the Department; and
''(iv) such other sanctions as the
Secretary determines appropriate to discourage
noncompliance.''.

SEC. 4. COVERAGE OF RENTAL ASSISTANCE DEMONSTRATION PROPERTIES.

(a) Employment.--Subsection (c) of section 3 of the Housing and
Urban Development Act of 1968 (12 U.S.C. 1701u(c)) is amended--
(1) in paragraph (2), by inserting before the first comma
the following: ''(not including the rental assistance
demonstration program)''; and
(2) by adding at the end the following new paragraph:
''(3) Rental assistance demonstration program.--
''(A) In general.--The Secretary shall require that
public housing agencies and owners of multifamily
properties assisted under the rental assistance
demonstration program, and their contractors and
subcontractors, make their best efforts, consistent
with existing Federal, State, and local laws and
regulations, to give to low- and very low-income
persons all the training and employment opportunities
generated by or in such properties, including such
opportunities not involving property construction or
rehabilitation (which shall include opportunities
involving administration, management, service, and
maintenance) and including such opportunities generated
by assistance provided under the rental assistance
demonstration program.
''(B) Priority.--The efforts required under
subparagraph (A) shall be directed in the following
order of priority:
''(i) To residents of the housing
developments for which the assistance is
expended.
''(ii) To residents of other developments
managed by the public housing agency, if
applicable, that is expending the assistance.
''(iii) To participants in YouthBuild
programs receiving assistance under section 171
of the Workforce Innovation and Opportunity
Act.
''(iv) To other low- and very low-income
persons residing within the metropolitan area
(or nonmetropolitan county) in which the
assistance is expended.''.
(b) Contracting.--Subsection (d) of section 3 of the Housing and
Urban Development Act of 1968 (12 U.S.C. 1701u(d)) is amended--
(1) in paragraph (2), by inserting before the first comma
the following: ''(not including the rental assistance
demonstration program)''; and
(2) by adding at the end the following new paragraph:
''(3) Rental assistance demonstration program.--
''(A) In general.--The Secretary shall require that
public housing agencies and owners of multifamily
properties assisted under the rental assistance
demonstration program, and their contractors and
subcontractors, make their best efforts, consistent
with existing Federal, State, and local laws and
regulations, to award contracts for work to be
performed in connection with such properties, including
work that does not involve property construction or
rehabilitation (which shall include administration,
management, service, and maintenance work) and
including work in connection assistance provided under
the rental assistance demonstration program, to
business concerns that provide economic opportunities
for low- and very low-income persons.
''(B) Priority.--The efforts required under
subparagraph (A) shall be directed in the following
order of priority:
''(i) To business concerns that provide
economic opportunities for residents of the
housing development for which the assistance is
provided.
''(ii) To business concerns that provide
economic opportunities for residents of other
housing developments operated by the public
housing agency, if applicable, that is
providing the assistance.
''(iii) To YouthBuild programs receiving
assistance under section 171 of the Workforce
Innovation and Opportunity Act.
''(iv) To business concerns that provide
economic opportunities for low- and very low-
income persons residing within the metropolitan
area (or nonmetropolitan county) in which the
assistance is provided.''.
(c) Definition.--Subsection (e) of section 3 of the Housing and
Urban Development Act of 1968 (12 U.S.C. 1701u(e)) is amended by adding
at the end the following new paragraph:
''(3) Rental assistance demonstration program.--The term
'rental assistance demonstration program' means the
demonstration program of the Secretary of Housing and Urban
Development conducted pursuant to the heading 'Rental
Assistance Demonstration' in title II of the Transportation,
Housing and Urban Development, and Related Agencies
Appropriations Act, 2012 (division C of Public Law 112-55; 125
Stat. 673), as amended.''.
Section 3 Modernization and Improvement Act of 2015 This bill amends the Housing and Urban Development Act of 1968 to revise the Department of Housing and Urban Development (HUD) program for economic opportunities for low- and very low-income persons. Public and Indian housing agencies that receive HUD development assistance, operating assistance, or modernization grants provided under the program (recipients) must report annually to HUD on their compliance with employment and contracting requirements and on the performance of their contractors and subcontractors. HUD must develop and implement policies and procedures for imposing a series of administrative sanctions, graduated in severity, on recipients and their contractors and subcontractors for noncompliance with this Act or the program's requirements. The HUD rental assistance program is exempted from requirements that: opportunities for training and employment in connection with a housing rehabilitation, housing construction, or other public construction project be given to low- and very low-income persons residing within the metropolitan area (or nonmetropolitan county) in which the project is located; and contracts awarded for work in connection with such projects be given to businesses providing economic opportunities for such persons in those areas in which the assistance is expended. HUD shall require that public housing agencies (PHAs) and owners of multifamily properties assisted under the rental assistance program, and their contractors and subcontractors, make their best efforts to give low- and very low-income persons all the training and employment opportunities generated by or in such properties, including opportunities: (1) not involving property construction or rehabilitation; and (2) generated by assistance provided under the program. HUD must also require that such PHAs and owners award work contracts in connection with these properties to businesses that provide economic opportunities for low- and very low-income persons.