US (United States) Code. Title 42. Chapter 8: Low-income housing

Codificación normativa de EEUU (Estados Unidos). Legislación federal estadounidense # The Public Health and Welfare

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-CITE-

42 USC Sec. 1437d 01/06/03

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TITLE 42 - THE PUBLIC HEALTH AND WELFARE

CHAPTER 8 - LOW-INCOME HOUSING

SUBCHAPTER I - GENERAL PROGRAM OF ASSISTED HOUSING

-HEAD-

Sec. 1437d. Contract provisions and requirements; loans and annual

contributions

-STATUTE-

(a) Conditions; elevators

The Secretary may include in any contract for loans,

contributions, sale, lease, mortgage, or any other agreement or

instrument made pursuant to this chapter, such covenants,

conditions, or provisions as he may deem necessary in order to

insure the lower income character of the project involved, in a

manner consistent with the public housing agency plan. Any such

contract shall require that, except in the case of housing

predominantly for elderly or disabled families, high-rise elevator

projects shall not be provided for families with children unless

the Secretary makes a determination that there is no practical

alternative.

(b) Limitation on development costs

(1) Each contract for loans (other than preliminary loans) or

contributions for the development, acquisition, or operation of

public housing shall provide that the total development cost of the

project on which the computation of any annual contributions under

this chapter may be based may not exceed the amount determined

under paragraph (2) (for the appropriate structure type) unless the

Secretary provides otherwise, and in any case may not exceed 110

per centum of such amount unless the Secretary for good cause

determines otherwise.

(2) For purposes of paragraph (1), the Secretary shall determine

the total development cost by multiplying the construction cost

guideline for the project (which shall be determined by averaging

the current construction costs, as listed by not less than 2

nationally recognized residential construction cost indices, for

publicly bid construction of a good and sound quality) by -

(A) in the case of elevator type structures, 1.6; and

(B) in the case of nonelevator type structures, 1.75.

(3) In calculating the total development cost of a project under

paragraph (2), the Secretary shall consider only capital assistance

provided by the Secretary to a public housing agency that are (!1)

authorized for use in connection with the development of public

housing, and shall exclude all other amounts, including amounts

provided under -

(A) the HOME investment partnerships program authorized under

title II of the Cranston-Gonzalez National Affordable Housing Act

[42 U.S.C. 12721 et seq.]; or

(B) the community development block grants program under title

I of the Housing and Community Development Act of 1974 [42 U.S.C.

5301 et seq.].

(4) The Secretary may restrict the amount of capital funds that a

public housing agency may use to pay for housing construction

costs. For purposes of this paragraph, housing construction costs

include the actual hard costs for the construction of units,

builders' overhead and profit, utilities from the street, and

finish landscaping.

(c) Revision of maximum income limits; certification of compliance

with requirements; notification of eligibility; informal hearing;

compliance with procedures for sound management

Every contract for contributions shall provide that -

(1) the Secretary may require the public housing agency to

review and revise its maximum income limits if the Secretary

determines that changed conditions in the locality make such

revision necessary in achieving the purposes of this chapter;

(2) the public housing agency shall determine, and so certify

to the Secretary, that each family in the project was admitted in

accordance with duly adopted regulations and approved income

limits; and the public housing agency shall review the incomes of

families living in the project no less frequently than annually;

(3) the public housing agency shall promptly notify (i) any

applicant determined to be ineligible for admission to the

project of the basis for such determination and provide the

applicant upon request, within a reasonable time after the

determination is made, with an opportunity for an informal

hearing on such determination, and (ii) any applicant determined

to be eligible for admission to the project of the approximate

date of occupancy insofar as such date can be reasonably

determined; and

(4) the public housing agency shall comply with such procedures

and requirements as the Secretary may prescribe to assure that

sound management practices will be followed in the operation of

the project, including requirements pertaining to -

(A) making dwelling units in public housing available for

occupancy, which shall provide that the public housing agency

may establish a system for making dwelling units available that

provides preference for such occupancy to families having

certain characteristics; each system of preferences established

pursuant to this subparagraph shall be based upon local housing

needs and priorities, as determined by the public housing

agency using generally accepted data sources, including any

information obtained pursuant to an opportunity for public

comment as provided under section 1437c-1(f) of this title and

under the requirements applicable to the comprehensive housing

affordability strategy for the relevant jurisdiction;

(B) the establishment of satisfactory procedures designed to

assure the prompt payment and collection of rents and the

prompt processing of evictions in the case of nonpayment of

rent;

(C) the establishment of effective tenant-management

relationships designed to assure that satisfactory standards of

tenant security and project maintenance are formulated and that

the public housing agency (together with tenant councils where

they exist) enforces those standards fully and effectively;

(D) the development by local housing authority managements of

viable homeownership opportunity programs for low-income

families capable of assuming the responsibilities of

homeownership;

(E) for each agency that receives assistance under this

subchapter, the establishment and maintenance of a system of

accounting for rental collections and costs (including

administrative, utility, maintenance, repair and other

operating costs) for each project or operating cost center (as

determined by the Secretary), which collections and costs shall

be made available to the general public and submitted to the

appropriate local public official (as determined by the

Secretary); except that the Secretary may permit agencies

owning or operating less than 500 units to comply with the

requirements of this subparagraph by accounting on an

agency-wide basis; and

(F) requiring the public housing agency to ensure and

maintain compliance with subtitle C of title VI of the Housing

and Community Development Act of 1992 [42 U.S.C. 13601 et seq.]

and any regulations issued under such subtitle.

(d) Exemption from personal and real property taxes; payments in

lieu of taxes; cash contribution or tax remission

Every contract for contributions with respect to a low-income

housing project shall provide that no contributions by the

Secretary shall be made available for such project unless such

project (exclusive of any portion thereof which is not assisted by

contributions under this chapter) is exempt from all real and

personal property taxes levied or imposed by the State, city,

county, or other political subdivision; and such contract shall

require the public housing agency to make payments in lieu of taxes

equal to 10 per centum of the sum of the shelter rents charged in

such project, or such lesser amount as (i) is prescribed by State

law, or (ii) is agreed to by the local governing body in its

agreement for local cooperation with the public housing agency

required under section 1437c(e)(2) of this title, or (iii) is due

to failure of a local public body or bodies other than the public

housing agency to perform any obligation under such agreement. If

any such project is not exempt from all real and personal property

taxes levied or imposed by the State, city, county, or other

political subdivision, such contract shall provide, in lieu of the

requirement for tax exemption and payments in lieu of taxes, that

no contributions by the Secretary shall be made available for such

project unless and until the State, city, county, or other

political subdivision in which such project is situated shall

contribute, in the form of cash or tax remission, the amount by

which the taxes paid with respect to the project exceed 10 per

centum of the shelter rents charged in such project.

(e) Repealed. Pub. L. 105-276, title V, Sec. 529(2), Oct. 21, 1998,

112 Stat. 2569

(f) Housing quality requirements

(1) In general

Each contract for contributions for a public housing agency

shall require that the agency maintain its public housing in a

condition that complies with standards which meet or exceed the

housing quality standards established under paragraph (2).

(2) Federal standards

The Secretary shall establish housing quality standards under

this paragraph that ensure that public housing dwelling units are

safe and habitable. Such standards shall include requirements

relating to habitability, including maintenance, health and

sanitation factors, condition, and construction of dwellings, and

shall, to the greatest extent practicable, be consistent with the

standards established under section 1437f(o)(8)(B)(i) of this

title. The Secretary may determine whether the laws, regulations,

standards, or codes of any State or local jurisdiction meet or

exceed these standards, for purposes of this subsection.

(3) Annual inspections

Each public housing agency that owns or operates public housing

shall make an annual inspection of each public housing project to

determine whether units in the project are maintained in

accordance with the requirements under paragraph (1). The agency

shall retain the results of such inspections and, upon the

request of the Secretary, the Inspector General for the

Department of Housing and Urban Development, or any auditor

conducting an audit under section 1437c(h) of this title, shall

make such results available.

(g) Substantial default; conveyance of title and delivery of

possession; reconveyance and redelivery; payments for outstanding

obligations

Every contract for contributions (including contracts which amend

or supersede contracts previously made) may provide that -

(1) upon the occurrence of a substantial default in respect to

the covenants or conditions to which the public housing agency is

subject (as such substantial default shall be defined in such

contract), the public housing agency shall be obligated at the

option of the Secretary either to convey title in any case where,

in the determination of the Secretary (which determination shall

be final and conclusive), such conveyance of title is necessary

to achieve the purposes of this chapter, or to deliver to the

Secretary possession of the project, as then constituted, to

which such contract relates; and

(2) the Secretary shall be obligated to reconvey or redeliver

possession of the project as constituted at the time of

reconveyance or redelivery, to such public housing agency or to

its successor (if such public housing agency or a successor

exists) upon such terms as shall be prescribed in such contract,

and as soon as practicable (i) after the Secretary is satisfied

that all defaults with respect to the project have been cured,

and that the project will, in order to fulfill the purposes of

this chapter, thereafter be operated in accordance with the terms

of such contract; or (ii) after the termination of the obligation

to make annual contributions available unless there are any

obligations or covenants of the public housing agency to the

Secretary which are then in default. Any prior conveyances and

reconveyances or deliveries and redeliveries of possession shall

not exhaust the right to require a conveyance or delivery of

possession of the project to the Secretary pursuant to

subparagraph (1) upon the subsequent occurrence of a substantial

default.

Whenever such a contract for annual contributions includes

provisions which the Secretary in such contract determines are in

accordance with this subsection, and the portion of the annual

contribution payable for debt service requirements pursuant to such

contract has been pledged by the public housing agency as security

for the payment of the principal and interest on any of its

obligations, the Secretary (notwithstanding any other provisions of

this chapter) shall continue to make such annual contributions

available for the project so long as any of such obligations remain

outstanding, and may covenant in such contract that in any event

such annual contributions shall in each year be at least equal to

an amount which, together with such income or other funds as are

actually available from the project for the purpose at the time

such annual contribution is made, will suffice for the payment of

all installments, falling due within the next succeeding twelve

months, of principal and interest on the obligations for which the

annual contributions provided for in the contract shall have been

pledged as security. In no case shall such annual contributions be

in excess of the maximum sum specified in the contract involved,

nor for longer than the remainder of the maximum period fixed by

the contract.

(h) New construction contracts

On or after October 1, 1983, the Secretary may enter into a

contract involving new construction only if the public housing

agency demonstrates to the satisfaction of the Secretary that the

cost of new construction in the neighborhood where the public

housing agency determines the housing is needed is less than the

cost of acquisition or acquisition and rehabilitation in such

neighborhood, including any reserve fund under subsection (i) of

this section, would be.

(i) Reserve fund; major repairs

The Secretary may, upon application by a public housing agency in

connection with the acquisition of housing for use as public

housing, establish and set aside a reserve fund in an amount not to

exceed 30 per centum of the acquisition cost which shall be

available for use for major repairs to such housing.

(j) Performance indicators for public housing agencies

(1) The Secretary shall develop and publish in the Federal

Register indicators to assess the management performance of public

housing agencies and resident management corporations. The

indicators shall be established by rule under section 553 of title

5. Such indicators shall enable the Secretary to evaluate the

performance of public housing agencies and resident management

corporations in all major areas of management operations. The

Secretary shall, in particular, use the following indicators for

public housing agencies, to the extent practicable:

(A) The number and percentage of vacancies within an agency's

inventory, including the progress that an agency has made within

the previous 3 years to reduce such vacancies.

(B) The amount and percentage of funds provided to the public

housing agency from the Capital Fund under section 1437g(d) of

this title which remain unobligated by the public housing agency

after 3 years.

(C) The percentage of rents uncollected.

(D) The utility consumption (with appropriate adjustments to

reflect different regions and unit sizes).

(E) The average period of time that an agency requires to

repair and turn-around vacant units.

(F) The proportion of maintenance work orders outstanding,

including any progress that an agency has made during the

preceding 3 years to reduce the period of time required to

complete maintenance work orders.

(G) The percentage of units that an agency fails to inspect to

ascertain maintenance or modernization needs within such period

of time as the Secretary deems appropriate (with appropriate

adjustments, if any, for large and small agencies).

(H) The extent to which the public housing agency -

(i) coordinates, promotes, or provides effective programs and

activities to promote the economic self-sufficiency of public

housing residents; and

(ii) provides public housing residents with opportunities for

involvement in the administration of the public housing.

(I) (!2) The extent to which the public housing agency -

(i) implements effective screening and eviction policies and

other anticrime strategies; and

(ii) coordinates with local government officials and

residents in the project and implementation of such strategies.

(J) The extent to which the public housing agency is providing

acceptable basic housing conditions.

(K) Any other factors as the Secretary deems appropriate which

shall not exceed the seven factors in the statute, plus an

additional five.

(I) (!3) The Secretary shall:

(1) administer the system of evaluating public housing

agencies flexibly to ensure that such agencies are not

penalized as result of circumstances beyond their control;

(2) reflect in the weights assigned to the various indicators

the differences in the difficulty of managing individual

projects that result from their physical condition and their

neighborhood environment; and

(3) determine a public housing agency's status as "troubled

with respect to the program under section 1437l (!4) of this

title" based upon factors solely related to its ability to

carry out that program.

(2)(A)(i) The Secretary shall, under the rulemaking procedures

under section 553 of title 5, establish procedures for designating

troubled public housing agencies, which procedures shall include

identification of serious and substantial failure to perform as

measured by the performance indicators specified under paragraph

(1) and such other factors as the Secretary may deem to be

appropriate. Such procedures shall provide that an agency that

fails on a widespread basis to provide acceptable basic housing

conditions for its residents shall be designated as a troubled

public housing agency. The Secretary may use a simplified set of

indicators for public housing agencies with less than 250 public

housing units. The Secretary shall also designate, by rule under

section 553 of title 5, agencies that are troubled with respect to

the program for assistance from the Capital Fund under section

1437g(d) of this title.

(ii) The Secretary may also, in consultation with national

organizations representing public housing agencies and public

officials (as the Secretary determines appropriate), identify and

commend public housing agencies that meet the performance standards

established under paragraph (1) in an exemplary manner.

(iii) The Secretary shall establish procedures for public housing

agencies to appeal designation as a troubled agency (including

designation as a troubled agency for purposes of the program for

assistance from the Capital Fund under section 1437g(d) of this

title), to petition for removal of such designation, and to appeal

any refusal to remove such designation.

(B)(i) Upon designating a public housing agency with more than

250 units as troubled pursuant to subparagraph (A) and determining

that an assessment under this subparagraph will not duplicate any

comparable and recent review, the Secretary shall provide for an

on-site, independent assessment of the management of the agency.

(ii) To the extent the Secretary deems appropriate (taking into

account an agency's performance under the indicators specified

under paragraph (1)), the assessment team shall also consider

issues relating to the agency's resident population and physical

inventory, including the extent to which (I) the agency's

comprehensive plan prepared pursuant to section 1437l (!4) of this

title adequately and appropriately addresses the rehabilitation

needs of the agency's inventory, (II) residents of the agency are

involved in and informed of significant management decisions, and

(III) any projects in the agency's inventory are severely

distressed and eligible for assistance pursuant to section 1437v of

this title.

(iii) An independent assessment under this subparagraph shall be

carried out by a team of knowledgeable individuals selected by the

Secretary (referred to in this section as the "assessment team")

with expertise in public housing and real estate management. In

conducting an assessment, the assessment team shall consult with

the residents and with public and private entities in the

jurisdiction in which the public housing is located. The assessment

team shall provide to the Secretary and the public housing agency a

written report, which shall contain, at a minimum, recommendations

for such management improvements as are necessary to eliminate or

substantially remedy existing deficiencies.

(C) The Secretary shall seek to enter into an agreement with each

troubled public housing agency, after reviewing the report

submitted pursuant to subparagraph (B) (if applicable) and

consulting with the agency's assessment team. Such agreement shall

set forth -

(i) targets for improving performance as measured by the

performance indicators specified under paragraph (1) and other

requirements within a specified period of time;

(ii) strategies for meeting such targets, including a

description of the technical assistance that the Secretary will

make available to the agency; and

(iii) incentives or sanctions for effective implementation of

such strategies, which may include any constraints on the use of

funds that the Secretary determines are appropriate.

To the extent the Secretary deems appropriate (taking into account

an agency's performance under the indicators specified under

paragraph (1)), such agreement shall also set forth a plan for

enhancing resident involvement in the management of the public

housing agency. The Secretary and the public housing agency shall,

to the maximum extent practicable, seek the assistance of local

public and private entities in carrying out the agreement.

(D) The Secretary shall apply the provisions of this paragraph to

resident management corporations as well as public housing

agencies.

(3)(A) Notwithstanding any other provision of law or of any

contract for contributions, upon the occurrence of events or

conditions that constitute a substantial default by a public

housing agency with respect to the covenants or conditions to which

the public housing agency is subject or an agreement entered into

under paragraph (2), the Secretary may -

(i) solicit competitive proposals from other public housing

agencies and private housing management agents which (I) in the

discretion of the Secretary, may be selected by existing public

housing residents through administrative procedures established

by the Secretary, and (II) if appropriate, shall provide for such

agents to manage all, or part, of the housing administered by the

public housing agency or all or part of the other programs of the

agency;

(ii) petition for the appointment of a receiver (which may be

another public housing agency or a private management

corporation) of the public housing agency to any district court

of the United States or to any court of the State in which the

real property of the public housing agency is situated, that is

authorized to appoint a receiver for the purposes and having the

powers prescribed in this subsection;

(iii) solicit competitive proposals from other public housing

agencies and private entities with experience in construction

management in the eventuality that such agencies or firms may be

needed to oversee implementation of assistance made available

from the Capital Fund under section 1437g(d) of this title for

the housing; and (!5)

(iv) take possession of all or part of the public housing

agency, including all or part of any project or program of the

agency, including any project or program under any other

provision of this subchapter; and

(v) require the agency to make other arrangements acceptable to

the Secretary and in the best interests of the public housing

residents and families assisted under section 1437f of this title

for managing all, or part, of the public housing administered by

the agency or of the programs of the agency.

Residents of a public housing agency designated as troubled

pursuant to paragraph (2)(A) may petition the Secretary in writing

to take 1 or more of the actions referred to in this subparagraph.

The Secretary shall respond to such petitions in a timely manner

with a written description of the actions, if any, the Secretary

plans to take and, where applicable, the reasons why such actions

differ from the course proposed by the residents.

(B)(i) If a public housing agency is identified as troubled under

this subsection, the Secretary shall notify the agency of the

troubled status of the agency.

(ii)(I) Upon the expiration of the 1-year period beginning on the

later of the date on which the agency receives initial notice from

the Secretary of the troubled status of the agency under clause (i)

and October 21, 1998, the agency shall improve its performance, as

measured by the performance indicators established pursuant to

paragraph (1), by at least 50 percent of the difference between the

most recent performance measurement and the measurement necessary

to remove that agency's designation as troubled.

(II) Upon the expiration of the 2-year period beginning on the

later of the date on which the agency receives initial notice from

the Secretary of the troubled status of the agency under clause (i)

and October 21, 1998, the agency shall improve its performance, as

measured by the performance indicators established pursuant to

paragraph (1), such that the agency is no longer designated as

troubled.

(III) In the event that a public housing agency designated as

troubled under this subsection fails to comply with the

requirements set forth in subclause (I) or (II), the Secretary

shall -

(aa) in the case of a troubled public housing agency with 1,250

or more units, petition for the appointment of a receiver

pursuant to subparagraph (A)(ii); or

(bb) in the case of a troubled public housing agency with fewer

than 1,250 units, either petition for the appointment of a

receiver pursuant to subparagraph (A)(ii), or take possession of

the public housing agency (including all or part of any project

or program of the agency) pursuant to subparagraph (A)(iv) and

appoint, on a competitive or noncompetitive basis, an individual

or entity as an administrative receiver to assume the

responsibilities of the Secretary for the administration of all

or part of the public housing agency (including all or part of

any project or program of the agency).

This subparagraph shall not be construed to limit the courses of

action available to the Secretary under subparagraph (A).

(IV) During the period between the date on which a petition is

filed under subclause (III)(aa) and the date on which a receiver

assumes responsibility for the management of the public housing

agency under such subclause, the Secretary may take possession of

the public housing agency (including all or part of any project or

program of the agency) pursuant to subparagraph (A)(iv) and may

appoint, on a competitive or noncompetitive basis, an individual or

entity as an administrative receiver to assume the responsibilities

of the Secretary for the administration of all or part of the

public housing agency (including all or part of any project or

program of the agency).

(C) If a receiver is appointed pursuant to subparagraph (A)(ii),

in addition to the powers accorded by the court appointing the

receiver, the receiver -

(i) may abrogate any contract to which the United States or an

agency of the United States is not a party that, in the

receiver's written determination (which shall include the basis

for such determination), substantially impedes correction of the

substantial default, but only after the receiver determines that

reasonable efforts to renegotiate such contract have failed;

(ii) may demolish and dispose of all or part of the assets of

the public housing agency (including all or part of any project

of the agency) in accordance with section 1437p of this title,

including disposition by transfer of properties to

resident-supported nonprofit entities;

(iii) if determined to be appropriate by the Secretary, may

seek the establishment, as permitted by applicable State and

local law, of 1 or more new public housing agencies;

(iv) if determined to be appropriate by the Secretary, may seek

consolidation of all or part of the agency (including all or part

of any project or program of the agency), as permitted by

applicable State and local laws, into other well-managed public

housing agencies with the consent of such well-managed agencies;

and

(v) shall not be required to comply with any State or local law

relating to civil service requirements, employee rights (except

civil rights), procurement, or financial or administrative

controls that, in the receiver's written determination (which

shall include the basis for such determination), substantially

impedes correction of the substantial default.

(D)(i) If, pursuant to subparagraph (A)(iv), the Secretary takes

possession of all or part of the public housing agency, including

all or part of any project or program of the agency, the Secretary

-

(I) may abrogate any contract to which the United States or an

agency of the United States is not a party that, in the written

determination of the Secretary (which shall include the basis for

such determination), substantially impedes correction of the

substantial default, but only after the Secretary determines that

reasonable efforts to renegotiate such contract have failed;

(II) may demolish and dispose of all or part of the assets of

the public housing agency (including all or part of any project

of the agency) in accordance with section 1437p of this title,

including disposition by transfer of properties to

resident-supported nonprofit entities;

(III) may seek the establishment, as permitted by applicable

State and local law, of 1 or more new public housing agencies;

(IV) may seek consolidation of all or part of the agency

(including all or part of any project or program of the agency),

as permitted by applicable State and local laws, into other

well-managed public housing agencies with the consent of such

well-managed agencies;

(V) shall not be required to comply with any State or local law

relating to civil service requirements, employee rights (except

civil rights), procurement, or financial or administrative

controls that, in the Secretary's written determination (which

shall include the basis for such determination), substantially

impedes correction of the substantial default; and

(VI) shall, without any action by a district court of the

United States, have such additional authority as a district court

of the United States would have the authority to confer upon a

receiver to achieve the purposes of the receivership.

(ii) If, pursuant to subparagraph (B)(ii)(III)(bb), the Secretary

appoints an administrative receiver to assume the responsibilities

of the Secretary for the administration of all or part of the

public housing agency (including all or part of any project or

program of the agency), the Secretary may delegate to the

administrative receiver any or all of the powers given the

Secretary by this subparagraph, as the Secretary determines to be

appropriate and subject to clause (iii).

(iii) An administrative receiver may not take an action described

in subclause (III) or (IV) of clause (i) unless the Secretary first

approves an application by the administrative receiver to authorize

such action.

(E) The Secretary may make available to receivers and other

entities selected or appointed pursuant to this paragraph such

assistance as the Secretary determines in the discretion of the

Secretary is necessary and available to remedy the substantial

deterioration of living conditions in individual public housing

projects or other related emergencies that endanger the health,

safety, and welfare of public housing residents or families

assisted under section 1437f of this title. A decision made by the

Secretary under this paragraph shall not be subject to review in

any court of the United States, or in any court of any State,

territory, or possession of the United States.

(F) In any proceeding under subparagraph (A)(ii), upon a

determination that a substantial default has occurred and without

regard to the availability of alternative remedies, the court shall

appoint a receiver to conduct the affairs of all or part of the

public housing agency in a manner consistent with this chapter and

in accordance with such further terms and conditions as the court

may provide. The receiver appointed may be another public housing

agency, a private management corporation, or any other person or

appropriate entity. The court shall have power to grant appropriate

temporary or preliminary relief pending final disposition of the

petition by the Secretary.

(G) The appointment of a receiver pursuant to this paragraph may

be terminated, upon the petition of any party, when the court

determines that all defaults have been cured or the public housing

agency is capable again of discharging its duties.

(H) If the Secretary (or an administrative receiver appointed by

the Secretary) takes possession of a public housing agency

(including all or part of any project or program of the agency), or

if a receiver is appointed by a court, the Secretary or receiver

shall be deemed to be acting not in the official capacity of that

person or entity, but rather in the capacity of the public housing

agency, and any liability incurred, regardless of whether the

incident giving rise to that liability occurred while the Secretary

or receiver was in possession of all or part of the public housing

agency (including all or part of any project or program of the

agency), shall be the liability of the public housing agency.

(4) Sanctions for improper use of amounts. -

(A) In general. - In addition to any other actions authorized

under this chapter, if the Secretary finds that a public housing

agency receiving assistance amounts under section 1437g of this

title for public housing has failed to comply substantially with

any provision of this chapter relating to the public housing

program, the Secretary may -

(i) terminate assistance payments under this (!6) section

1437g of this title to the agency;

(ii) withhold from the agency amounts from the total

allocations for the agency pursuant to section 1437g of this

title;

(iii) reduce the amount of future assistance payments under

section 1437g of this title to the agency by an amount equal to

the amount of such payments that were not expended in

accordance with this chapter;

(iv) limit the availability of assistance amounts provided to

the agency under section 1437g of this title to programs,

projects, or activities not affected by such failure to comply;

(v) withhold from the agency amounts allocated for the agency

under section 1437f of this title; or

(vi) order other corrective action with respect to the

agency.

(B) Termination of compliance action. - If the Secretary takes

action under subparagraph (A) with respect to a public housing

agency, the Secretary shall -

(i) in the case of action under subparagraph (A)(i), resume

payments of assistance amounts under section 1437g of this

title to the agency in the full amount of the total allocations

under section 1437g of this title for the agency at the time

that the Secretary first determines that the agency will comply

with the provisions of this chapter relating to the public

housing program;

(ii) in the case of action under clause (ii) or (v) of

subparagraph (A), make withheld amounts available as the

Secretary considers appropriate to ensure that the agency

complies with the provisions of this chapter relating to such

program;

(iii) in the case of action under subparagraph (A)(iv),

release such restrictions at the time that the Secretary first

determines that the agency will comply with the provisions of

this chapter relating to such program; or

(iv) in the case of action under subparagraph (vi), cease

such action at the time that the Secretary first determines

that the agency will comply with the provisions of this chapter

relating to such program.

(5) The Secretary shall submit to the Congress annually, as a

part of the report of the Secretary under section 3536 of this

title, a report that -

(A) identifies the public housing agencies that have been

designated as troubled under paragraph (2);

(B) describes the grounds on which such public housing agencies

were designated as troubled and continue to be so designated;

(C) describes the agreements that have been entered into with

such agencies under such paragraph;

(D) describes the status of progress under such agreements;

(E) describes any action that has been taken in accordance with

paragraph (3), including an accounting of the authorized funds

that have been expended to support such actions; and

(F) describes the status of any public housing agency

designated as troubled with respect to the program for assistance

from the Capital Fund under section 1437g(d) of this title and

specifies the amount of assistance the agency received under such

program.

(6)(A) To the extent that the Secretary determines such action to

be necessary in order to ensure the accuracy of any certification

made under this section, the Secretary shall require an independent

auditor to review documentation or other information maintained by

a public housing agency pursuant to this section to substantiate

each certification submitted by the agency or corporation relating

to the performance of that agency or corporation.

(B) The Secretary may withhold, from assistance otherwise payable

to the agency or corporation under section 1437g of this title,

amounts sufficient to pay for the reasonable costs of any review

under this paragraph.

(7) The Secretary shall apply the provisions of this subsection

to resident management corporations in the same manner as applied

to public housing agencies.

(k) Administrative grievance procedure regulations: grounds of

adverse action, hearing, examination of documents,

representation, evidence, decision; judicial hearing; eviction

and termination procedures

The Secretary shall by regulation require each public housing

agency receiving assistance under this chapter to establish and

implement an administrative grievance procedure under which tenants

will -

(1) be advised of the specific grounds of any proposed adverse

public housing agency action;

(2) have an opportunity for a hearing before an impartial party

upon timely request within any period applicable under subsection

(l) of this section;

(3) have an opportunity to examine any documents or records or

regulations related to the proposed action;

(4) be entitled to be represented by another person of their

choice at any hearing;

(5) be entitled to ask questions of witnesses and have others

make statements on their behalf; and

(6) be entitled to receive a written decision by the public

housing agency on the proposed action.

For any grievance concerning an eviction or termination of tenancy

that involves any activity that threatens the health, safety, or

right to peaceful enjoyment of the premises of other tenants or

employees of the public housing agency or any violent or

drug-related criminal activity on or off such premises, or any

activity resulting in a felony conviction, the agency may (A)

establish an expedited grievance procedure as the Secretary shall

provide by rule under section 553 of title 5, or (B) exclude from

its grievance procedure any such grievance, in any jurisdiction

which requires that prior to eviction, a tenant be given a hearing

in court which the Secretary determines provides the basic elements

of due process (which the Secretary shall establish by rule under

section 553 of title 5). Such elements of due process shall not

include a requirement that the tenant be provided an opportunity to

examine relevant documents within the possession of the public

housing agency. The agency shall provide to the tenant a reasonable

opportunity, prior to hearing or trial, to examine any relevant

documents, records, or regulations directly related to the eviction

or termination.

(l) Leases; terms and conditions; maintenance; termination

Each public housing agency shall utilize leases which -

(1) have a term of 12 months and shall be automatically renewed

for all purposes except for noncompliance with the requirements

under section 1437j(c) of this title (relating to community

service requirements); except that nothing in this subchapter

shall prevent a resident from seeking timely redress in court for

failure to renew based on such noncompliance;

(2) do not contain unreasonable terms and conditions;

(3) obligate the public housing agency to maintain the project

in a decent, safe, and sanitary condition;

(4) require the public housing agency to give adequate written

notice of termination of the lease which shall not be less than -

(A) a reasonable period of time, but not to exceed 30 days -

(i) if the health or safety of other tenants, public

housing agency employees, or persons residing in the

immediate vicinity of the premises is threatened; or

(ii) in the event of any drug-related or violent criminal

activity or any felony conviction;

(B) 14 days in the case of nonpayment of rent; and

(C) 30 days in any other case, except that if a State or

local law provides for a shorter period of time, such shorter

period shall apply;

(5) require that the public housing agency may not terminate

the tenancy except for serious or repeated violation of the terms

or conditions of the lease or for other good cause;

(6) provide that any criminal activity that threatens the

health, safety, or right to peaceful enjoyment of the premises by

other tenants or any drug-related criminal activity on or off

such premises, engaged in by a public housing tenant, any member

of the tenant's household, or any guest or other person under the

tenant's control, shall be cause for termination of tenancy;

(7) specify that with respect to any notice of eviction or

termination, notwithstanding any State law, a public housing

tenant shall be informed of the opportunity, prior to any hearing

or trial, to examine any relevant documents, records, or

regulations directly related to the eviction or termination;

(7) (!7) provide that any occupancy in violation of section

13661(b) of this title (relating to ineligibility of illegal drug

users and alcohol abusers) or the furnishing of any false or

misleading information pursuant to section 13662 of this title

(relating to termination of tenancy and assistance for illegal

drug users and alcohol abusers) shall be cause for termination of

tenancy; (!8)

(9) provide that it shall be cause for immediate termination of

the tenancy of a public housing tenant if such tenant -

(A) is fleeing to avoid prosecution, or custody or

confinement after conviction, under the laws of the place from

which the individual flees, for a crime, or attempt to commit a

crime, which is a felony under the laws of the place from which

the individual flees, or which, in the case of the State of New

Jersey, is a high misdemeanor under the laws of such State; or

(2) (!9) is violating a condition of probation or parole

imposed under Federal or State law.

For purposes of paragraph (5),(!10) the term "drug-related criminal

activity" means the illegal manufacture, sale, distribution, use,

or possession with intent to manufacture, sell, distribute, or use,

of a controlled substance (as defined in section 802 of title 21).

(m) Reporting requirements; limitation

The Secretary shall not impose any unnecessarily duplicative or

burdensome reporting requirements on tenants or public housing

agencies assisted under this chapter.

(n) Notice to post office regarding eviction for criminal activity

When a public housing agency evicts an individual or family from

a dwelling unit for engaging in criminal activity, including

drug-related criminal activity, the public housing agency shall

notify the local post office serving that dwelling unit that such

individual or family is no longer residing in the dwelling unit.

(o) Public housing assistance for foster care children

In providing housing in low-income housing projects, each public

housing agency may coordinate with any local public agencies

involved in providing for the welfare of children to make available

dwelling units to -

(1) families identified by the agencies as having a lack of

adequate housing that is a primary factor -

(A) in the imminent placement of a child in foster care; or

(B) in preventing the discharge of a child from foster care

and reunification with his or her family; and

(2) youth, upon discharge from foster care, in cases in which

return to the family or extended family or adoption is not

available.

(p) Repealed. Pub. L. 105-276, title V, Sec. 519(b), Oct. 21, 1998,

112 Stat. 2561

(q) Availability of records

(1) In general

(A) Provision of information

Notwithstanding any other provision of law, except as

provided in subparagraph (C), the National Crime Information

Center, police departments, and other law enforcement agencies

shall, upon request, provide information to public housing

agencies regarding the criminal conviction records of adult

applicants for, or tenants of, covered housing assistance for

purposes of applicant screening, lease enforcement, and

eviction.

(B) Requests by owners of project-based section 8 [42 U.S.C.

1437f] housing

A public housing agency may make a request under subparagraph

(A) for information regarding applicants for, or tenants of,

housing that is provided project-based assistance under section

1437f of this title only if the housing is located within the

jurisdiction of the agency and the owner of such housing has

requested that the agency obtain such information on behalf of

the owner. Upon such a request by the owner, the agency shall

make a request under subparagraph (A) for the information. The

agency may not make such information available to the owner but

shall perform determinations for the owner regarding screening,

lease enforcement, and eviction based on criteria supplied by

the owner.

(C) Exception

A law enforcement agency described in subparagraph (A) shall

provide information under this paragraph relating to any

criminal conviction of a juvenile only to the extent that the

release of such information is authorized under the law of the

applicable State, tribe, or locality.

(2) Opportunity to dispute

Before an adverse action is taken with regard to assistance

under this subchapter on the basis of a criminal record, the

public housing agency shall provide the tenant or applicant with

a copy of the criminal record and an opportunity to dispute the

accuracy and relevance of that record.

(3) Fees

A public housing agency may be charged a reasonable fee for

information provided under paragraph (1). In the case of a public

housing agency obtaining information pursuant to paragraph (1)(B)

for another owner of housing, the agency may pass such fee on to

the owner initiating the request and may charge additional

reasonable fees for making the request on behalf of the owner and

taking other actions for owners under this subsection.

(4) Records management

Each public housing agency shall establish and implement a

system of records management that ensures that any criminal

record received by the public housing agency is -

(A) maintained confidentially;

(B) not misused or improperly disseminated; and

(C) destroyed, once the purpose for which the record was

requested has been accomplished.

(5) Confidentiality

A public housing agency receiving information under this

subsection may use such information only for the purposes

provided in this subsection and such information may not be

disclosed to any person who is not an officer, employee, or

authorized representative of the agency and who has a job-related

need to have access to the information in connection with

admission of applicants, eviction of tenants, or termination of

assistance. For judicial eviction proceedings, disclosures may be

made to the extent necessary. The Secretary shall, by regulation,

establish procedures necessary to ensure that information

provided under this subsection to a public housing agency is

used, and confidentiality of such information is maintained, as

required under this subsection. The Secretary shall establish

standards for confidentiality of information obtained under this

subsection by public housing agencies on behalf of owners.

(6) Penalty

Any person who knowingly and willfully requests or obtains any

information concerning an applicant for, or tenant of, covered

housing assistance pursuant to the authority under this

subsection under false pretenses, or any person who knowingly and

willfully discloses any such information in any manner to any

individual not entitled under any law to receive it, shall be

guilty of a misdemeanor and fined not more than $5,000. The term

"person" as used in this paragraph include (!11) an officer,

employee, or authorized representative of any public housing

agency.

(7) Civil action

Any applicant for, or tenant of, covered housing assistance

affected by (A) a negligent or knowing disclosure of information

referred to in this subsection about such person by an officer,

employee, or authorized representative of any public housing

agency, which disclosure is not authorized by this subsection, or

(B) any other negligent or knowing action that is inconsistent

with this subsection, may bring a civil action for damages and

such other relief as may be appropriate against any public

housing agency responsible for such unauthorized action. The

district court of the United States in the district in which the

affected applicant or tenant resides, in which such unauthorized

action occurred, or in which the officer, employee, or

representative alleged to be responsible for any such

unauthorized action resides, shall have jurisdiction in such

matters. Appropriate relief that may be ordered by such district

courts shall include reasonable attorney's fees and other

litigation costs.

(8) Definitions

For purposes of this subsection, the following definitions

shall apply:

(A) Adult

The term "adult" means a person who is 18 years of age or

older, or who has been convicted of a crime as an adult under

any Federal, State, or tribal law.

(B) Covered housing assistance

The term "covered housing assistance" means -

(i) a dwelling unit in public housing;

(ii) a dwelling unit in housing that is provided

project-based assistance under section 1437f of this title,

including new construction and substantial rehabilitation

projects; and

(iii) tenant-based assistance under section 1437f of this

title.

(C) Owner

The term "owner" means, with respect to covered housing

assistance described in subparagraph (B)(ii), the entity or

private person (including a cooperative or public housing

agency) that has the legal right to lease or sublease dwelling

units in the housing assisted.

(r) Site-based waiting lists

(1) Authority

A public housing agency may establish procedures for

maintaining waiting lists for admissions to public housing

projects of the agency, which may include (notwithstanding any

other law, regulation, handbook, or notice to the contrary) a

system of site-based waiting lists under which applicants may

apply directly at or otherwise designate the project or projects

in which they seek to reside. All such procedures shall comply

with all provisions of title VI of the Civil Rights Act of 1964

[42 U.S.C. 2000d et seq.], the Fair Housing Act [42 U.S.C. 3601

et seq.], and other applicable civil rights laws.

(2) Notice

Any system described in paragraph (1) shall provide for the

full disclosure by the public housing agency to each applicant of

any option available to the applicant in the selection of the

project in which to reside.

(s) Authority to require access to criminal records

A public housing agency may require, as a condition of providing

admission to the public housing program or assisted housing program

under the jurisdiction of the public housing agency, that each

adult member of the household provide a signed, written

authorization for the public housing agency to obtain records

described in subsection (q)(1) of this section regarding such

member of the household from the National Crime Information Center,

police departments, and other law enforcement agencies.

(t) Obtaining information from drug abuse treatment facilities

(1) Authority

Notwithstanding any other provision of law other than the

Public Health Service Act (42 U.S.C. 201 et seq.), a public

housing agency may require each person who applies for admission

to public housing to sign one or more forms of written consent

authorizing the agency to receive information from a drug abuse

treatment facility that is solely related to whether the

applicant is currently engaging in the illegal use of a

controlled substance.

(2) Confidentiality of applicant's records

(A) Limitation on information requested

In a form of written consent, a public housing agency may

request only whether the drug abuse treatment facility has

reasonable cause to believe that the applicant is currently

engaging in the illegal use of a controlled substance.

(B) Records management

Each public housing agency that receives information under

this subsection from a drug abuse treatment facility shall

establish and implement a system of records management that

ensures that any information received by the public housing

agency under this subsection -

(i) is maintained confidentially in accordance with section

543 of the Public Health Service Act [42 U.S.C. 290dd-2];

(ii) is not misused or improperly disseminated; and

(iii) is destroyed, as applicable -

(I) not later than 5 business days after the date on

which the public housing agency gives final approval for an

application for admission; or

(II) if the public housing agency denies the application

for admission, in a timely manner after the date on which

the statute of limitations for the commencement of a civil

action from the applicant based upon that denial of

admission has expired.

(C) Expiration of written consent

In addition to the requirements of subparagraph (B), an

applicant's signed written consent shall expire automatically

after the public housing agency has made a final decision to

either approve or deny the applicant's application for

admittance to public housing.

(3) Prohibition of discriminatory treatment of applicants

(A) Forms signed

A public housing agency may only require an applicant for

admission to public housing to sign one or more forms of

written consent under this subsection if the public housing

agency requires all such applicants to sign the same form or

forms of written consent.

(B) Circumstances of inquiry

A public housing agency may only make an inquiry to a drug

abuse treatment facility under this subsection if -

(i) the public housing agency makes the same inquiry with

respect to all applicants; or

(ii) the public housing agency only makes the same inquiry

with respect to each and every applicant with respect to whom

-

(I) the public housing agency receives information from

the criminal record of the applicant that indicates

evidence of a prior arrest or conviction; or

(II) the public housing agency receives information from

the records of prior tenancy of the applicant that

demonstrates that the applicant -

(aa) engaged in the destruction of property;

(bb) engaged in violent activity against another

person; or

(cc) interfered with the right of peaceful enjoyment of

the premises of another tenant.

(4) Fee permitted

A drug abuse treatment facility may charge a public housing

agency a reasonable fee for information provided under this

subsection.

(5) Disclosure permitted by treatment facilities

A drug abuse treatment facility shall not be liable for damages

based on any information required to be disclosed pursuant to

this subsection if such disclosure is consistent with section 543

of the Public Health Service Act (42 U.S.C. 290dd-2).

(6) Option to not request information

A public housing agency shall not be liable for damages based

on its decision not to require each person who applies for

admission to public housing to sign one or more forms of written

consent authorizing the public housing agency to receive

information from a drug abuse treatment facility under this

subsection.

(7) Definitions

For purposes of this subsection, the following definitions

shall apply:

(A) Drug abuse treatment facility

The term "drug abuse treatment facility" means an entity that

-

(i) is -

(I) an identified unit within a general medical care

facility; or

(II) an entity other than a general medical care

facility; and

(ii) holds itself out as providing, and provides,

diagnosis, treatment, or referral for treatment with respect

to the illegal use of a controlled substance.

(B) Controlled substance

The term "controlled substance" has the meaning given the

term in section 802 of title 21.

(C) Currently engaging in the illegal use of a controlled

substance

The term "currently engaging in the illegal use of a

controlled substance" means the illegal use of a controlled

substance that occurred recently enough to justify a reasonable

belief that an applicant's illegal use of a controlled

substance is current or that continuing illegal use of a

controlled substance by the applicant is a real and ongoing

problem.

(8) Effective date

This subsection shall take effect on October 21, 1998, and

without the necessity of guidance from, or any regulation issued

by, the Secretary.

-SOURCE-

(Sept. 1, 1937, ch. 896, title I, Sec. 6, as added Pub. L. 93-383,

title II, Sec. 201(a), Aug. 22, 1974, 88 Stat. 659; amended Pub. L.

96-153, title II, Sec. 206(a), Dec. 21, 1979, 93 Stat. 1108; Pub.

L. 96-399, title II, Secs. 201(c), (e), 202(c), Oct. 8, 1980, 94

Stat. 1625, 1629; Pub. L. 97-35, title III, Sec. 322(c), (d), Aug.

13, 1981, 95 Stat. 402; Pub. L. 98-181, title II, Secs. 201(c),

203(a), 204, 205, 214(b), Nov. 30, 1983, 97 Stat. 1177-1179, 1185;

Pub. L. 98-479, title I, Sec. 102(b)(4), (5), title II, Sec.

204(b)(1), Oct. 17, 1984, 98 Stat. 2221, 2233; Pub. L. 99-160,

title I, Sec. 101, Nov. 25, 1985, 99 Stat. 910; Pub. L. 100-242,

title I, Secs. 112(b)(2), 116, 170(d), Feb. 5, 1988, 101 Stat.

1824, 1826, 1867; renumbered title I, Pub. L. 100-358, Sec. 5, June

29, 1988, 102 Stat. 681; Pub. L. 100-628, title X, Secs. 1001(b),

1014(a)(1), Nov. 7, 1988, 102 Stat. 3263, 3269; Pub. L. 100-690,

title V, Sec. 5101, Nov. 18, 1988, 102 Stat. 4300; Pub. L. 101-144,

title II, Nov. 9, 1989, 103 Stat. 846; Pub. L. 101-625, title V,

Secs. 501, 502(a), (c)(1), 503(a), (b), 504-506, 572, Nov. 28,

1990, 104 Stat. 4180, 4181, 4183-4185, 4236; Pub. L. 102-139, title

II, Oct. 28, 1991, 105 Stat. 756, 757; Pub. L. 102-550, title I,

Secs. 112, 113, title VI, Secs. 622(b), 625(a)(2), 682(a), Oct. 28,

1992, 106 Stat. 3689, 3817, 3820, 3830; Pub. L. 103-233, title I,

Sec. 101(c)(1), title III, Sec. 303, Apr. 11, 1994, 108 Stat. 357,

370; Pub. L. 103-327, title II, Sept. 28, 1994, 108 Stat. 2315;

Pub. L. 104-99, title IV, Sec. 402(d)(1), (6)(A)(i), Jan. 26, 1996,

110 Stat. 41, 42; Pub. L. 104-120, Sec. 9(a)-(c), Mar. 28, 1996,

110 Stat. 836, 837; Pub. L. 104-193, title IX, Sec. 903(a)(1), Aug.

22, 1996, 110 Stat. 2348; Pub. L. 104-330, title V, Sec. 501(b)(3),

Oct. 26, 1996, 110 Stat. 4042; Pub. L. 105-276, title V, Secs.

511(d), 512(b), 514(a)(1), (2)(A), 519(b), 520(b), 521, 525, 529,

530, 564, 565(a), 575, 576(d)(1), Oct. 21, 1998, 112 Stat. 2539,

2543, 2547, 2561, 2563, 2568, 2569, 2627, 2628, 2634, 2640.)

-REFTEXT-

REFERENCES IN TEXT

The Cranston-Gonzalez National Affordable Housing Act, referred

to in subsec. (b)(3)(A), is Pub. L. 101-625, Nov. 28, 1990, 104

Stat. 4079. Title II of the Act, known as the "HOME Investments

Partnership Act", is classified principally to subchapter II (Sec.

12721 et seq.) of chapter 130 of this title. For complete

classification of this Act to the Code, see Short Title note set

out under section 12701 of this title and Tables.

The Housing and Community Development Act of 1974, referred to in

subsec. (b)(3)(B), is Pub. L. 93-383, Aug. 22, 1974, 88 Stat. 633,

as amended. Title I of the Act is classified principally to chapter

69 (Sec. 5301 et seq.) of this title. For complete classification

of this Act to the Code, see Short Title note set out under section

5301 of this title and Tables.

The Housing and Community Development Act of 1992, referred to in

subsec. (c)(4)(F), is Pub. L. 102-550, Oct. 28, 1992, 106 Stat.

3672. Subtitle C of title VI of the Act is classified generally to

subchapter I (Sec. 13601 et seq.) of chapter 135 of this title. For

complete classification of this Act to the Code, see Short Title of

1992 Amendment note set out under section 5301 of this title and

Tables.

Section 1437l of this title, referred to in subsec. (j)(1)(I)(3),

(2)(B)(ii), was repealed by Pub. L. 105-276, title V, Sec. 522(a),

Oct. 21, 1998, 112 Stat. 2564.

Paragraph (5), referred to in the concluding provisions of

subsec. (l), was redesignated as par. (6) by Pub. L. 105-276, title

V, Sec. 512(b)(1), Oct. 21, 1998, 112 Stat. 2543.

The Civil Rights Act of 1964, referred to in subsec. (r)(1), is

Pub. L. 88-352, July 2, 1964, 78 Stat. 241, as amended. Title VI of

the Act is classified generally to subchapter V (Sec. 2000d et

seq.) of chapter 21 of this title. For complete classification of

this Act to the Code, see Short Title note set out under section

2000a of this title and Tables.

The Fair Housing Act, referred to in subsec. (r)(1), is title

VIII of Pub. L. 90-284, Apr. 11, 1968, 82 Stat. 81, as amended,

which is classified principally to subchapter I (Sec. 3601 et seq.)

of chapter 45 of this title. For complete classification of this

Act to the Code, see Short Title note set out under section 3601 of

this title and Tables.

The civil rights laws, referred to in subsec. (r)(1), are

classified generally to chapter 21 (Sec. 1981 et seq.) of this

title.

The Public Health Service Act, referred to in subsec. (t)(1), is

act July 1, 1944, ch. 373, 58 Stat. 682, as amended, which is

classified generally to chapter 6A (Sec. 201 et seq.) of this

title. For complete classification of this Act to the Code, see

Short Title note set out under section 201 of this title and

Tables.

-MISC1-

PRIOR PROVISIONS

A prior section 6 of act Sept. 1, 1937, ch. 896, 50 Stat. 890, as

amended, enumerated financial provisions applicable to the

Authority and was classified to section 1406 of this title, prior

to the general revision of this chapter by Pub. L. 93-383.

AMENDMENTS

1998 - Subsec. (a). Pub. L. 105-276, Sec. 511(d), in first

sentence, inserted ", in a manner consistent with the public

housing agency plan" before the period at end and struck out after

first sentence "Any such contract may contain a condition requiring

the maintenance of an open space or playground in connection with

the housing project involved if deemed necessary by the Secretary

for the safety or health of children."

Subsec. (b)(3), (4). Pub. L. 105-276, Sec. 520(b), added pars.

(3) and (4).

Subsec. (c)(4)(A). Pub. L. 105-276, Sec. 514(a)(1), amended

subpar. (A) generally. For former text of subpar. (A), see 1996

Amendment note below.

Subsec. (c)(4)(E). Pub. L. 105-276, Sec. 529(1), substituted "for

each agency that receives assistance under this subchapter" for

"except in the case of agencies not receiving operating assistance

under section 1437g of this title".

Subsec. (e). Pub. L. 105-276, Sec. 529(2), struck out subsec. (e)

which read as follows: "Every contract for annual contributions

shall provide that whenever in any year the receipts of a public

housing agency in connection with a low-income housing project

exceed its expenditures (including debt service, operation,

maintenance, establishment of reserves, and other costs and

charges), an amount equal to such excess shall be applied, or set

aside for application, to purposes, which, in the determination of

the Secretary, will effect a reduction in the amount of subsequent

annual contributions."

Subsec. (f). Pub. L. 105-276, Sec. 530, added subsec. (f).

Subsec. (j)(1)(B). Pub. L. 105-276, Sec. 564(1)(A), added subpar.

(B) and struck out former subpar. (B) which read as follows: "The

amount and percentage of funds obligated to the public housing

agency under section 1437l of this title which remain unexpended

after 3 years."

Subsec. (j)(1)(D). Pub. L. 105-276, Sec. 564(1)(B), substituted

"utility" for "energy".

Subsec. (j)(1)(E). Pub. L. 105-276, Sec. 564(1)(C), which

directed the transfer and insertion of subpar. (E) after subpar.

(D), required no change in text.

Subsec. (j)(1)(H) to (K). Pub. L. 105-276, Sec. 564(1)(D), (E),

added subpars. (H), (I), relating to extent to which agency

implements and coordinates strategies, and (J), and redesignated

former subpar. (H) as (K).

Subsec. (j)(2)(A)(i). Pub. L. 105-276, Sec. 564(2)(A), inserted

after first sentence "Such procedures shall provide that an agency

that fails on a widespread basis to provide acceptable basic

housing conditions for its residents shall be designated as a

troubled public housing agency. The Secretary may use a simplified

set of indicators for public housing agencies with less than 250

public housing units." and, in last sentence, substituted "for

assistance from the Capital Fund under section 1437g(d) of this

title" for "under section 1437l of this title".

Subsec. (j)(2)(A)(iii). Pub. L. 105-276, Sec. 564(2)(B),

substituted "for assistance from the Capital Fund under section

1437g(d) of this title" for "under section 1437l of this title".

Subsec. (j)(2)(B)(i). Pub. L. 105-276, Sec. 564(2)(C), inserted

"with more than 250 units" after "public housing agency" and

substituted "comparable and recent review" for "review conducted

under section 1437l(p) of this title".

Subsec. (j)(2)(C). Pub. L. 105-276, Sec. 564(2)(D), inserted "(if

applicable)" after "subparagraph (B)" in first sentence.

Subsec. (j)(3)(A)(i). Pub. L. 105-276, Sec. 565(a)(1)(A), added

cl. (i) and struck out former cl. (i) which read as follows:

"solicit competitive proposals from other public housing agencies

and private housing management agents (which may be selected by

existing tenants through administrative procedures established by

the Secretary) in the eventuality that these agents may be needed

for managing all, or part, of the housing administered by a public

housing agency;".

Subsec. (j)(3)(A)(iii). Pub. L. 105-276, Sec. 565(a)(1)(B),

substituted "from the Capital Fund under section 1437g(d) of this

title" for "under section 1437l of this title".

Subsec. (j)(3)(A)(iv), (v). Pub. L. 105-276, Sec. 565(a)(1)(C),

added cls. (iv) and (v) and struck out former cl. (iv) which read

as follows: "require the agency to make other arrangements

acceptable to the Secretary and in the best interests of the public

housing residents for managing all, or part of, such housing."

Subsec. (j)(3)(B) to (H). Pub. L. 105-276, Sec. 565(a)(2), added

subpars. (B) to (H) and struck out former subpars. (B) to (D) which

read as follows:

"(B) The Secretary may make available to receivers and other

entities selected or appointed pursuant to this paragraph such

assistance as is necessary to remedy the substantial deterioration

of living conditions in individual public housing developments or

other related emergencies that endanger the health, safety and

welfare of the residents.

"(C) In any proceeding under subparagraph (A)(ii), upon a

determination that a substantial default has occurred, and without

regard to the availability of alternative remedies, the court shall

appoint a receiver to conduct the affairs of the public housing

agency in a manner consistent with this chapter and in accordance

with such further terms and conditions as the court may provide.

The court shall have power to grant appropriate temporary or

preliminary relief pending final disposition of the petition by the

Secretary.

"(D) The appointment of a receiver pursuant to this subsection

may be terminated, upon the petition of any party, when the court

determines that all defaults have been cured and the housing

operated by the public housing agency will thereafter be operated

in accordance with the covenants and conditions to which the public

housing agency is subject."

Subsec. (j)(4), (5). Pub. L. 105-276, Sec. 521, added par. (4)

and redesignated former par. (4) as (5).

Subsec. (j)(5)(F). Pub. L. 105-276, Sec. 564(3), substituted

"program for assistance from the Capital Fund under section

1437g(d) of this title and specifies the amount of assistance the

agency received under such program." for "program under section

1437l of this title and specifies the amount of assistance the

agency received under section 1437l of this title and any credits

accumulated by the agency under section 1437l(k)(5)(D) of this

title."

Subsec. (j)(6), (7). Pub. L. 105-276, Sec. 564(4), added pars.

(6) and (7).

Subsec. (k). Pub. L. 105-276, Sec. 575(a), in first sentence of

concluding provisions, inserted "violent or" before "drug-related"

and "or any activity resulting in a felony conviction," after "on

or off such premises,".

Subsec. (l)(1) to (3). Pub. L. 105-276, Sec. 512(b)(1), (3),

added par. (1) and redesignated former pars. (1) to (3) as (2) to

(4), respectively.

Subsec. (l)(4). Pub. L. 105-276, Sec. 512(b)(1), redesignated

par. (3) as (4). Former par. (4) redesignated (5).

Subsec. (l)(4)(A). Pub. L. 105-276, Sec. 575(b)(1)(A), added

subpar. (A) and struck out former subpar. (A) which read as

follows: "a reasonable time, but not to exceed 30 days, when the

health or safety of other tenants or public housing agency

employees is threatened;".

Subsec. (l)(4)(C). Pub. L. 105-276, Sec. 575(b)(1)(B), inserted

", except that if a State or local law provides for a shorter

period of time, such shorter period shall apply" before semicolon

at end.

Subsec. (l)(5), (6). Pub. L. 105-276, Sec. 512(b)(1),

redesignated pars. (4) and (5) as (5) and (6), respectively. Former

par. (6) redesignated (7), relating to specification that tenant be

informed of opportunity to examine documents.

Subsec. (l)(7). Pub. L. 105-276, Sec. 575(b)(4), added par. (7)

relating to termination for illegal drug use and alcohol abuse.

Pub. L. 105-276, Sec. 575(b)(2), struck out "and" at end.

Pub. L. 105-276, Sec. 512(b)(2), which directed the redesignation

of par. (7) as (9), was executed by redesignating the par. (7),

relating to termination of tenancy if tenant is fleeing prosecution

or in violation of parole, as (9), to reflect the probable intent

of Congress.

Pub. L. 105-276, Sec. 512(b)(1), redesignated par. (6) as (7),

relating to specification that tenant be informed of opportunity to

examine documents.

Subsec. (l)(9). Pub. L. 105-276, Sec. 512(b)(2), which directed

the redesignation of par. (7) as (9), was executed by redesignating

the par. (7), relating to termination of tenancy if tenant is

fleeing prosecution or in violation of parole, as (9), to reflect

the probable intent of Congress.

Subsec. (o). Pub. L. 105-276, Sec. 514(a)(2)(A), substituted "In"

for "Subject" and all that follows through ", in" in introductory

provisions.

Subsec. (p). Pub. L. 105-276, Sec. 519(b), struck out subsec. (p)

which read as follows: "With respect to amounts available for

obligation on or after October 1, 1991, the criteria established

under section 1439(d)(5)(B) of this title for any competition for

assistance for new construction, acquisition, or acquisition and

rehabilitation of public housing shall give preference to

applications for housing to be located in a local market area that

has an inadequate supply of housing available for use by very

low-income families. The Secretary shall establish criteria for

determining that the housing supply of a local market area is

inadequate, which shall require -

"(1)(A) information regarding housing market conditions showing

that the supply of rental housing affordable by very low-income

families is inadequate, taking into account vacancy rates in such

housing and other market indicators; and

"(B) evidence that significant numbers of families in the local

market area holding certificates and vouchers under section 1437f

of this title are experiencing significant difficulty in leasing

housing meeting program and family-size requirements; or

"(2) evidence that the proposed development would provide

increased housing opportunities for minorities or address special

housing needs."

Subsec. (q)(1)(A). Pub. L. 105-276, Sec. 575(c)(1)(A)(ii), which

directed the substitution of "covered housing assistance" for

"public housing", was executed by making the substitution in the

second place that "public housing" appeared, to reflect the

probable intent of Congress.

Pub. L. 105-276, Sec. 575(c)(1)(A)(i), substituted "subparagraph

(C)" for "subparagraph (B)".

Subsec. (q)(1)(B), (C). Pub. L. 105-276, Sec. 575(c)(1)(B), (C),

added subpar. (B) and redesignated former subpar. (B) as (C).

Subsec. (q)(3). Pub. L. 105-276, Sec. 575(c)(2), substituted

"Fees" for "Fee" in heading and inserted at end "In the case of a

public housing agency obtaining information pursuant to paragraph

(1)(B) for another owner of housing, the agency may pass such fee

on to the owner initiating the request and may charge additional

reasonable fees for making the request on behalf of the owner and

taking other actions for owners under this subsection."

Subsec. (q)(5) to (8). Pub. L. 105-276, Sec. 575(c)(3), (4),

added pars. (5) to (8) and struck out heading and text of former

par. (5). Text read as follows: "For purposes of this subsection,

the term 'adult' means a person who is 18 years of age or older, or

who has been convicted of a crime as an adult under any Federal,

State, or tribal law."

Subsec. (r). Pub. L. 105-276, Sec. 576(d)(1), redesignated

subsec. (s) as (r) and struck out heading and text of former

subsec. (r). Text read as follows: "Any tenant evicted from housing

assisted under this subchapter by reason of drug-related criminal

activity (as that term is defined in section 1437f(f) of this

title) shall not be eligible for housing assistance under this

subchapter during the 3-year period beginning on the date of such

eviction, unless the evicted tenant successfully completes a

rehabilitation program approved by the public housing agency (which

shall include a waiver of this subsection if the circumstances

leading to eviction no longer exist)."

Subsec. (s). Pub. L. 105-276, Sec. 576(d)(1)(B), redesignated

subsec. (t) as (s). Former subsec. (s) redesignated (r).

Pub. L. 105-276, Sec. 525, added subsec. (s).

Subsec. (t). Pub. L. 105-276, Sec. 576(d)(1)(B), redesignated

subsec. (u) as (t). Former subsec. (t) redesignated (s).

Pub. L. 105-276, Sec. 575(d), added subsec. (t).

Subsec. (u). Pub. L. 105-276, Sec. 576(d)(1)(B), redesignated

subsec. (u) as (t).

Pub. L. 105-276, Sec. 575(e), added subsec. (u).

1996 - Subsec. (b)(1). Pub. L. 104-330 struck out "and public

housing for Indians and Alaska Natives in accordance with the

Indian Housing Act of 1988" after "operation of public housing".

Subsec. (c)(4)(A). Pub. L. 104-99, Sec. 402(d)(1), (f),

temporarily amended subpar. (A) generally, substituting

"(A) the establishment, after public notice and an opportunity

for public comment, of a written system of preferences for

admission to public housing, if any, that is not inconsistent with

the comprehensive housing affordability strategy under title I of

the Cranston-Gonzalez National Affordable Housing Act;" for

"(A) except for projects or portions of projects designated for

occupancy pursuant to section 1437e(a) of this title with respect

to which the Secretary has determined that application of this

subparagraph would result in excessive delays in meeting the

housing need of such families, the establishment of tenant

selection criteria which -

"(i) for not less than 50 percent of the units that are made

available for occupancy in a given fiscal year, give preference

to families that occupy substandard housing (including families

that are homeless or living in a shelter for homeless families),

are paying more than 50 percent of family income for rent, or are

involuntarily displaced (including displacement because of

disposition of a multifamily housing project under section

1701z-11 of title 12) at the time they are seeking assistance

under this chapter;

"(ii) for any remaining units to be made available for

occupancy, give preference in accordance with a system of

preferences established by the public housing agency in writing

and after public hearing to respond to local housing needs and

priorities, which may include (I) assisting very low-income

families who either reside in transitional housing assisted under

title IV of the Stewart B. McKinney Homeless Assistance Act, or

participate in a program designed to provide public assistance

recipients with greater access to employment and educational

opportunities; (II) assisting families in accordance with

subsection (u)(2); (III) assisting families identified by local

public agencies involved in providing for the welfare of children

as having a lack of adequate housing that is a primary factor in

the imminent placement of a child in foster care, or in

preventing the discharge of a child from foster care and

reunification with his or her family; (IV) assisting youth, upon

discharge from foster care, in cases in which return to the

family or extended family or adoption is not available; (V)

assisting families that include one or more adult members who are

employed; and (VI) achieving other objectives of national housing

policy as affirmed by Congress; subclause (V) shall be effective

only during fiscal year 1995;

"(iii) prohibit any individual or family evicted from housing

assisted under the chapter by reason of drug-related criminal

activity from having a preference under any provision of this

subparagraph for 3 years unless the evicted tenant successfully

completes a rehabilitation program approved by the agency, except

that the agency may waive the application of this clause under

standards established by the Secretary (which shall include

waiver for any member of a family of an individual prohibited

from tenancy under this clause who the agency determines clearly

did not participate in and had no knowledge of such criminal

activity or when circumstances leading to eviction no longer

exist); and

"(iv) are designed to ensure that, to the maximum extent

feasible, the projects of an agency will include families with a

broad range of incomes and will avoid concentrations of

low-income and deprived families with serious social problems."

See Effective and Termination Dates of 1996 Amendments note below.

Subsec. (k). Pub. L. 104-120, Sec. 9(a)(1), in concluding

provisions, substituted "involves any activity" for "involves any

criminal activity" and "on or off such premises" for "on or near

such premises".

Subsec. (l)(5). Pub. L. 104-120, Sec. 9(a)(2), substituted "on or

off such premises" for "on or near such premises".

Subsec. (l)(7). Pub. L. 104-193 added par. (7).

Subsec. (o). Pub. L. 104-99, Sec. 402(d)(6)(A)(i), (f), in

introductory provisions, temporarily substituted "written system of

preferences for selection established pursuant to" for "preference

rules specified in". See Effective and Termination Dates of 1996

Amendments note below.

Subsec. (q). Pub. L. 104-120, Sec. 9(b), added subsec. (q).

Subsec. (r). Pub. L. 104-120, Sec. 9(c), added subsec. (r).

1994 - Subsec. (c)(4)(A)(i). Pub. L. 103-233, Sec. 101(c)(1),

inserted "(including displacement because of disposition of a

multifamily housing project under section 1701z-11 of title 12)"

after "displaced".

Subsec. (c)(4)(A)(ii). Pub. L. 103-327 added subcl. (V),

redesignated former subcl. (V) as (VI), and inserted "subclause (V)

shall be effective only during fiscal year 1995;" after semicolon

at end.

Subsec. (c)(4)(E). Pub. L. 103-233, Sec. 303, substituted "500

units" for "250 units".

1992 - Subsec. (a). Pub. L. 102-550, Sec. 625(a)(2), substituted

"elderly or disabled families" for "the elderly" in last sentence.

Subsec. (c)(4)(A). Pub. L. 102-550, Sec. 622(b), substituted

"designated for occupancy pursuant to section 1437e(a) of this

title" for "specifically designated for elderly families" in

introductory provisions.

Subsec. (c)(4)(A)(i). Pub. L. 102-550, Sec. 112, substituted "50

percent" for "70 percent" after "not less than".

Subsec. (c)(4)(F). Pub. L. 102-550, Sec. 682(a), added subpar.

(F).

Subsec. (j)(1). Pub. L. 102-550, Sec. 113(e)(1)(C), which

directed the substitution of "indicators for public housing

agencies, to the extent practicable:" for "indicators." in fourth

sentence, was executed by making the substitution for "indicators:"

to reflect the probable intent of Congress.

Pub. L. 102-550, Sec. 113(e)(1)(A), (B), in introductory

provisions, inserted "and resident management corporations" before

period in first sentence and after "agencies" in third sentence.

Subsec. (j)(2)(B). Pub. L. 102-550, Sec. 113(a)(2), added subpar.

(B). Former subpar. (B) redesignated (C).

Subsec. (j)(2)(C). Pub. L. 102-550, Sec. 113(a)(1), (3),

redesignated subpar. (B) as (C), substituted "agency, after

reviewing the report submitted pursuant to subparagraph (B) and

consulting with the agency's assessment team. Such agreement shall

set forth" for "agency setting forth" in introductory provisions,

and inserted "To the extent the Secretary deems appropriate (taking

into account an agency's performance under the indicators specified

under paragraph (1)), such agreement shall also set forth a plan

for enhancing resident involvement in the management of the public

housing agency." before "The Secretary and the public" in

concluding provisions.

Subsec. (j)(2)(D). Pub. L. 102-550, Sec. 113(e)(2), added subpar.

(D).

Subsec. (j)(3)(A). Pub. L. 102-550, Sec. 113(b)(5), inserted

concluding provisions.

Subsec. (j)(3)(A)(i). Pub. L. 102-550, Sec. 113(b)(1), inserted

"(which may be selected by existing tenants through administrative

procedures established by the Secretary)" after "management

agents".

Subsec. (j)(3)(A)(iii), (iv). Pub. L. 102-550, Sec.

113(b)(2)-(4), added cl. (iii) and redesignated former cl. (iii) as

(iv).

Subsec. (j)(3)(B) to (D). Pub. L. 102-550, Sec. 113(c), added

subpar. (B) and redesignated former subpars. (B) and (C) as (C) and

(D), respectively.

Subsec. (j)(4)(E). Pub. L. 102-550, Sec. 113(d), which directed

the insertion of ", including an accounting of the authorized funds

that have been expended to support such actions" before semicolon

in par. (5)(E) of subsec. (j), was executed by making the insertion

in par. (4)(E) to reflect the probable intent of Congress, because

subsec. (j) does not contain a par. (5).

1991 - Subsec. (j)(1)(H), (I). Pub. L. 102-139, which directed

amendment of "Section 6(j)(1) of the Housing Act of 1937, 42 U.S.C.

1437d(j)(1) section 502(a) of the National Affordable Housing Act,"

by adding "which shall not exceed the seven factors in the statute,

plus an additional five" at the end of subpar. (H) and by adding

subpar. (I), requiring Secretary to administer evaluation system,

reflect in weights assigned indicators, and determine status, was

executed to subsec. (j)(1) of this section, which is section 6 of

the United States Housing Act of 1937, to reflect the probable

intent of Congress.

Subsec. (p). Pub. L. 102-139 added subsec. (p).

1990 - Subsec. (c)(4)(A). Pub. L. 101-625, Sec. 501, amended

subpar. (A) generally. Prior to amendment, subpar. (A) read as

follows: "except for projects or portions of projects specifically

designated for elderly families with respect to which the Secretary

has determined that application of this clause would result in

excessive delays in meeting the housing needs of such families, the

establishment of tenant selection criteria which gives preference

to families which occupy substandard housing, are paying more than

50 percent of family income for rent, or are involuntarily

displaced at the time they are seeking assistance under this

chapter and which is designed to assure that, within a reasonable

period of time, the project will include families with a broad

range of incomes and will avoid concentrations of lower income and

deprived families with serious social problems, but (i) this shall

not permit maintenance of vacancies to await higher income tenants

where lower income tenants are available and shall not permit

public housing agencies to select families for residence in an

order different from the order on the waiting list for the purpose

of selecting relatively higher income families for residence; and

(ii) the public housing agency may provide for circumstances in

which families who do not qualify for any preference established in

this subparagraph are provided assistance before families who do

qualify for such preference, except that not more than 10 percent

of the families who initially receive assistance in any 1-year

period (or such shorter period selected by the public housing

agency before the beginning of its first full year subject to this

clause) may be families who do not qualify for such preference;".

Subsec. (c)(4)(D). Pub. L. 101-625, Sec. 572(1), substituted

"low-income families" for "lower income families".

Subsec. (c)(4)(E). Pub. L. 101-625, Sec. 502(c)(1), added subpar.

(E).

Subsecs. (d), (e). Pub. L. 101-625, Sec. 572(2), substituted

"low-income housing" for "lower income housing" wherever appearing.

Subsec. (j). Pub. L. 101-625, Sec. 502(a), amended subsec. (j)

generally. Prior to amendment, subsec. (j) read as follows: "On or

after October 1, 1983, in entering into commitments for the

development of public housing, the Secretary shall give a priority

to projects for the construction, acquisition, or acquisition and

rehabilitation of housing suitable for occupancy by families

requiring three or more bedrooms."

Subsec. (k). Pub. L. 101-625, Sec. 503(a), added concluding

provisions and struck out former concluding provisions which read

as follows: "An agency may exclude from its procedure any grievance

concerning an eviction or termination of tenancy in any

jurisdiction which requires that, prior to eviction, a tenant be

given a hearing in court which the Secretary determines provides

the basic elements of due process."

Subsec. (l)(5). Pub. L. 101-625, Sec. 504, amended par. (5)

generally. Prior to amendment, par. (5) read as follows: "provide

that a public housing tenant, any member of the tenant's household,

or a guest or other person under the tenant's control shall not

engage in criminal activity, including drug-related criminal

activity, on or near public housing premises, while the tenant is a

tenant in public housing, and such criminal activity shall be cause

for termination of tenancy."

Subsec. (l)(6). Pub. L. 101-625, Sec. 503(b), added par. (6).

Subsecs. (n), (o). Pub. L. 101-625, Secs. 505, 506, added

subsecs. (n) and (o).

1989 - Subsec. (b). Pub. L. 101-144 added subsec. (b).

1988 - Subsec. (a). Pub. L. 100-242, Sec. 170(d)(1), substituted

"The Secretary" for "Secretary" at beginning.

Pub. L. 100-242, Sec. 112(b)(2), struck out "annual" before

"contributions".

Subsec. (c). Pub. L. 100-242, Sec. 112(b)(2), struck out "annual"

before "contributions" in introductory provisions.

Subsec. (c)(4)(A). Pub. L. 100-628, Sec. 1014(a)(1), inserted cl.

(i) designation after ", but" and added cl. (ii) before semicolon

at end.

Pub. L. 100-628, Sec. 1001(b), inserted before semicolon at end

"and shall not permit public housing agencies to select families

for residence in an order different from the order on the waiting

list for the purpose of selecting relatively higher income families

for residence".

Pub. L. 100-242, Sec. 170(d)(2), inserted ", are paying more than

50 percent of family income for rent," after "substandard housing",

and struck out "or are paying more than 50 per centum of family

income for rent" after "under this chapter".

Subsec. (d). Pub. L. 100-242, Sec. 112(b)(2), struck out "annual"

before "contributions" in four places and before "shelter" in two

places.

Subsec. (g). Pub. L. 100-242, Sec. 112(b)(2), struck out "annual"

before "contributions" in introductory provisions.

Subsec. (h). Pub. L. 100-242, Sec. 116, inserted "in the

neighborhood where the public housing agency determines the housing

is needed" after "is" and "in such neighborhood" after

"rehabilitation".

Subsec. (k)(4), (5). Pub. L. 100-242, Sec. 170(d)(3), substituted

"their" for "his".

Subsec. (l). Pub. L. 100-690 added par. (5) and concluding

provisions defining term "drug-related criminal activity" for

purposes of par. (5).

1985 - Subsec. (b). Pub. L. 99-160 struck out subsec. (b) which

related to cost of construction and equipment of a project, and

prototype costs.

1984 - Subsec. (a). Pub. L. 98-479, Sec. 204(b)(1), substituted

"covenants" for "convenants".

Subsec. (j). Pub. L. 98-479, Sec. 102(b)(4), inserted ",

acquisition, or acquisition and rehabilitation" and substituted

"families requiring three or more bedrooms" for "large families".

Subsec. (m). Pub. L. 98-479, Sec. 102(b)(5), substituted

"housing" for "hearing".

1983 - Subsec. (c)(4)(A). Pub. L. 98-181, Sec. 203(a), inserted

"or are paying more than 50 per centum of family income for rent".

Subsec. (f). Pub. L. 98-181, Sec. 214(b), repealed subsec. (f)

which provided for modification or closeout of housing project.

Subsecs. (h) to (j). Pub. L. 98-181, Sec. 201(c), added subsecs.

(h) to (j).

Subsecs. (k), (l). Pub. L. 98-181, Sec. 204, added subsecs. (k)

and (l).

Subsec. (m). Pub. L. 98-181, Sec. 205, added subsec. (m).

1981 - Subsec. (a). Pub. L. 97-35, Sec. 322(c), substituted

reference to lower income for reference to low-income.

Subsec. (c). Pub. L. 97-35, Sec. 322(c), (d), substituted

provision in par. (2) requiring review at least annually for

provision requiring review at least within two year intervals, or

shorter where deemed desirable, in par. (4)(A) "lower income and"

for "low-income and", and in par. (4)(D) reference to lower income

for reference to low-income.

Subsecs. (d), (e). Pub. L. 97-35, Sec. 322(c), substituted

references to lower income for references to low-income wherever

appearing.

1980 - Subsec. (b). Pub. L. 96-399, Sec. 201(c), inserted

exception relating to availability of prototype costs for projects

to be located on Indian reservations or in Alaskan Native villages,

and added cl. (8).

Subsec. (c)(4)(A). Pub. L. 96-399, Sec. 201(e), inserted

exception relating to application of this clause to projects

specifically designated for elderly families.

Subsec. (f). Pub. L. 96-399, Sec. 202(c), inserted "pursuant to

section 1437l of this title" wherever appearing.

1979 - Subsec. (c)(4)(A). Pub. L. 96-153 substituted "tenant

selection criteria which gives preference to families which occupy

substandard housing or are involuntarily displaced at the time they

are seeking assistance under this chapter and which is designed"

for "tenant selection criteria designed".

EFFECTIVE DATE OF 1998 AMENDMENT

Amendment by title V of Pub. L. 105-276 effective and applicable

beginning upon Oct. 1, 1999, except as otherwise provided, with

provision that Secretary may implement amendment before such date,

except to extent that such amendment provides otherwise, and with

savings provision, see section 503 of Pub. L. 105-276, set out as a

note under section 1437 of this title.

Amendment by section 511 of Pub. L. 105-276 effective and

applicable beginning upon Oct. 21, 1998, see section 511(e) of Pub.

L. 105-276, set out as a note under section 1437c-1 of this title.

Amendment by section 514(a)(1), (2)(A) of Pub. L. 105-276

effective and applicable beginning upon Oct. 21, 1998, see section

514(g) of Pub. L. 105-276, set out as a note under section 1701s of

Title 12, Banks and Banking.

Pub. L. 105-276, title V, Sec. 565(b), Oct. 21, 1998, 112 Stat.

2631, provided that: "The provisions of, and duties and authorities

conferred or confirmed by, the amendments made by subsection (a)

[amending this section] shall apply with respect to any action

taken before, on, or after the effective date of this Act [probably

means the general effective date for title V of Pub. L. 105-276

included in section 503 of Pub. L. 105-276, set out as an Effective

Date of 1998 Amendment note under section 1437 of this title] and

shall apply to any receiver appointed for a public housing agency

before the date of the enactment of this Act [Oct. 21, 1998]."

Pub. L. 105-276, title V, Sec. 565(e), Oct. 21, 1998, 112 Stat.

2632, provided that: "This section [amending this section and

section 1437f of this title and enacting provisions set out as

notes under this section] shall take effect on, and the amendments

made by this section are made on, and shall apply beginning upon,

the date of the enactment of this Act [Oct. 21, 1998]."

EFFECTIVE AND TERMINATION DATES OF 1996 AMENDMENTS

Amendment by Pub. L. 104-330 effective Oct. 1, 1997, except as

otherwise expressly provided, see section 107 of Pub. L. 104-330,

set out as an Effective Date note under section 4101 of Title 25,

Indians.

Pub. L. 104-120, Sec. 13, Mar. 28, 1996, 110 Stat. 845, provided

that:

"(a) Applicability. - This Act [enacting section 1490p-2 of this

title, amending this section, sections 1437e, 1437n, 1479, 1485,

1490p-2, and 5308 of this title, and sections 1715z-20, 1715z-22,

and 1721 of Title 12, Banks and Banking, and enacting provisions

set out as notes under sections 1437f, 5305, and 12805 of this

title and sections 1701 and 4101 of Title 12] and the amendments

made by this Act shall be construed to have become effective on

October 1, 1995.

"(b) Implementation. - The amendments made by sections 9 and 10

[amending this section and sections 1437e and 1437n of this title]

shall apply as provided in subsection (a) of this section,

notwithstanding the effective date of any regulations issued by the

Secretary of Housing and Urban Development to implement such

amendments or any failure by the Secretary to issue any such

regulations."

Amendment by Pub. L. 104-99 effective Jan. 26, 1996, only for

fiscal years 1996, 1997, and 1998, and to cease to be effective

Oct. 21, 1998, see section 402(f) of Pub. L. 104-99, as amended,

and section 514(f) of Pub. L. 105-276, set out as notes under

section 1437a of this title.

EFFECTIVE DATE OF 1992 AMENDMENT

Amendment by subtitles B through F of title VI [Secs. 621-685] of

Pub. L. 102-550 applicable upon expiration of 6-month period

beginning Oct. 28, 1992, except as otherwise provided, see section

13642 of this title.

EFFECTIVE DATE OF 1981 AMENDMENT

Amendment by Pub. L. 97-35 effective Oct. 1, 1981, see section

371 of Pub. L. 97-35, set out as an Effective Date note under

section 3701 of Title 12, Banks and Banking.

IMPLEMENTATION

Pub. L. 105-276, title V, Sec. 565(d), Oct. 21, 1998, 112 Stat.

2632, provided that: "The Secretary may administer the amendments

made by subsection (a) [amending this section] as necessary to

ensure the efficient and effective initial implementation of this

section [amending this section and section 1437f of this title and

enacting provisions set out as notes under this section]."

Section 502(c)(2) of Pub. L. 101-625, as amended by Pub. L.

102-550, title I, Sec. 130, Oct. 28, 1992, 106 Stat. 3712, provided

that: "The Secretary of Housing and Urban Development shall, under

the rulemaking procedures under section 553 of title 5, United

States Code, establish guidelines and timetables appropriate to

implement the amendment made by paragraph (1)(C) [amending this

section], taking into account the requirements of public housing

agencies of different sizes and characteristics, to achieve

compliance with requirements established by such amendment not

later than January 1, 1993 for public housing agencies with 500 or

more units and not later than January 1, 1994 for public housing

agencies with less than 500 units."

REGULATIONS

For provisions requiring Secretary of Housing and Urban

Development to issue regulations necessary to implement amendment

to this section by section 101(c) of Pub. L. 103-233, see section

101(f) of Pub. L. 103-233, set out as a note under section 1701z-11

of Title 12, Banks and Banking.

Section 104 of Pub. L. 102-550 provided that: "Not later than the

expiration of the 180-day period beginning on the date of the

enactment of this Act [Oct. 28, 1992], the Secretary of Housing and

Urban Development shall issue regulations implementing the

amendments made by sections 501 and 545 of the Cranston-Gonzalez

National Affordable Housing Act [Pub. L. 101-625, amending this

section and section 1437f of this title]. The regulations shall be

issued after notice and opportunity for public comment pursuant to

the provisions of section 553 of title 5, United States Code

(notwithstanding subsections (a)(2), (b)(B), and (d)(3) of such

section) and shall take effect upon issuance."

Section 503(c) of Pub. L. 101-625 provided that: "The Secretary

of Housing and Urban Development shall issue, and publish in the

Federal Register for comment, proposed rules implementing the

amendments made by this section [amending this section] not later

than the expiration of the 60-day period beginning on the date of

the enactment of this Act [Nov. 28, 1990] and shall issue final

rules implementing the amendments not later than the expiration of

the 180-day period beginning on the date of the enactment of this

Act."

STUDY OF ALTERNATIVE METHODS FOR EVALUATING PUBLIC HOUSING AGENCIES

Pub. L. 105-276, title V, Sec. 563, Oct. 21, 1998, 112 Stat.

2624, provided that:

"(a) In General. - The Secretary of Housing and Urban Development

shall provide under subsection (e) for a study to be conducted to

determine the effectiveness of various alternative methods of

evaluating the performance of public housing agencies and other

providers of federally assisted housing.

"(b) Purposes. - The purposes of the study under this section

shall be -

"(1) to identify and examine various methods of evaluating and

improving the performance of public housing agencies in

administering public housing and tenant-based rental assistance

programs and of other providers of federally assisted housing,

which are alternatives to oversight by the Department of Housing

and Urban Development; and

"(2) to identify specific monitoring and oversight activities

currently conducted by the Department of Housing and Urban

Development and to evaluate whether such activities should be

eliminated, expanded, modified, or transferred to other entities

(including governmental and private entities) to increase

accuracy and effectiveness and improve monitoring.

"(c) Evaluation of Various Performance Evaluation Systems. - To

carry out the purposes under subsection (b), the study under this

section shall identify, and analyze the advantages and

disadvantages of various methods of regulating and evaluating the

performance of public housing agencies and other providers of

federally assisted housing, including the following methods:

"(1) Current system. - The system pursuant to the United States

Housing Act of 1937 [42 U.S.C. 1437 et seq.], including the

methods and requirements under such system for reporting,

auditing, reviewing, sanctioning, and monitoring of such agencies

and housing providers and the public housing management

assessment program pursuant to section 6(j) of the United States

Housing Act of 1937 [42 U.S.C. 1437d(j)].

"(2) Accreditation models. - Various models that are based upon

accreditation of such agencies and housing providers, subject to

the following requirements:

"(A) The study shall identify and analyze various models used

in other industries and professions for accreditation and

determine the extent of their applicability to the programs for

public housing and federally assisted housing.

"(B) If any accreditation models are determined to be

applicable to the public and federally assisted housing

programs, the study shall identify appropriate goals,

objectives, and procedures for an accreditation program for

such agencies and housing providers.

"(C) The study shall evaluate the feasibility and merit of

establishing an independent accreditation and evaluation entity

to assist, supplement, or replace the role of the Department of

Housing and Urban Development in assessing and monitoring the

performance of such agencies and housing providers.

"(D) The study shall identify the necessary and appropriate

roles and responsibilities of various entities that would be

involved in an accreditation program, including the Department

of Housing and Urban Development, the Inspector General of the

Department, an accreditation entity, independent auditors and

examiners, local entities, and public housing agencies.

"(E) The study shall estimate the costs involved in

developing and maintaining such an independent accreditation

program.

"(3) Performance based models. - Various performance-based

models, including systems that establish performance goals or

targets, assess the compliance with such goals or targets, and

provide for incentives or sanctions based on performance relative

to such goals or targets.

"(4) Local review and monitoring models. - Various models

providing for local, resident, and community review and

monitoring of such agencies and housing providers, including

systems for review and monitoring by local and State governmental

bodies and agencies.

"(5) Private models. - Various models using private contractors

for review and monitoring of such agencies and housing providers.

"(6) Other models. - Various models of any other systems that

may be more effective and efficient in regulating and evaluating

such agencies and housing providers.

"(d) Consultation. - The entity that, pursuant to subsection (e),

carries out the study under this section shall, in carrying out the

study, consult with individuals and organizations experienced in

managing public housing, private real estate managers,

representatives from State and local governments, residents of

public housing, families and individuals receiving tenant-based

assistance, the Secretary of Housing and Urban Development, the

Inspector General of the Department of Housing and Urban

Development, and the Comptroller General of the United States.

"(e) Contract to Conduct Study. -

"(1) In general. - Subject to paragraph (2), the Secretary

shall enter into a contract, within 90 days of the enactment of

this Act [Oct. 21, 1998], with a public or nonprofit private

entity to conduct the study under this section, using amounts

made available pursuant to subsection (g).

"(2) National academy of public administration. - The Secretary

shall request the National Academy of Public Administration to

enter into the contract under paragraph (1) to conduct the study

under this section. If such Academy declines to conduct the

study, the Secretary shall carry out such paragraph through other

public or nonprofit private entities, selected through a

competitive process.

"(f) Report. -

"(1) Interim report. - The Secretary shall ensure that, not

later than the expiration of the 6-month period beginning on the

date of the execution of the contract under subsection (e)(1),

the entity conducting the study under this section submits to the

Congress an interim report describing the actions taken to carry

out the study, the actions to be taken to complete the study, and

any findings and recommendations available at the time.

"(2) Final report. - The Secretary shall ensure that -

"(A) not later than the expiration of the 12-month period

beginning on the date of the execution of the contract under

subsection (e)(1), the study required under this section is

completed and a report describing the findings and

recommendations as a result of the study is submitted to the

Congress; and

"(B) before submitting the report under this paragraph to the

Congress, the report is submitted to the Secretary, national

organizations for public housing agencies, and other

appropriate national organizations at such time to provide the

Secretary and such agencies an opportunity to review the report

and provide written comments on the report, which shall be

included together with the report upon submission to the

Congress under subparagraph (A).

"(g) Effective Date. - This section shall take effect on the date

of the enactment of this Act [Oct. 21, 1998]."

REFERENCES IN OTHER LAWS TO PREFERENCES FOR ASSISTANCE

Section 402(d)(6)(D) of Pub. L. 104-99, which provided that

certain references to preferences for assistance under sections

1437d(c)(4)(A)(i) and 1437f(d)(1)(A)(i), (o)(3)(B) of this title,

as such sections existed on the day before Jan. 26, 1996, were to

be considered to refer to the written system of preferences for

selection established pursuant to sections 1437d(c)(4)(A) and

1437f(d)(1)(A), (o)(3)(B) of this title, respectively, as amended

by section 402 of Pub. L. 104-99, was repealed by Pub. L. 105-276,

title V, Sec. 514(b)(2)(D), Oct. 21, 1998, 112 Stat. 2548.

INAPPLICABILITY OF CERTAIN 1992 AMENDMENTS TO INDIAN PUBLIC HOUSING

Amendment by sections 622(b) and 625(a)(2) of Pub. L. 102-550 not

applicable with respect to lower income housing developed or

operated pursuant to contract between Secretary of Housing and

Urban Development and Indian housing authority, see section 626 of

Pub. L. 102-550, set out as a note under section 1437a of this

title.

REPORT ON TRAINING AND CERTIFICATION STANDARDS

Section 502(b) of Pub. L. 101-625 directed Secretary to submit to

Congress, not later than 12 months after Nov. 28, 1990, a report

regarding the feasibility and effectiveness of establishing uniform

standards for training and certification of executive directors and

other officers and members of local, regional, and State public

housing agencies.

APPLICABILITY

Section 503(d) of Pub. L. 101-625 provided that: "Any exclusion

of grievances by a public housing agency pursuant to a

determination or waiver by the Secretary (under section 6(k) of the

United States Housing Act of 1937 [42 U.S.C. 1437d(k)], as such

section existed before the date of the enactment of this Act [Nov.

28, 1990]) that a jurisdiction requires a hearing in court

providing the basic elements of due process shall be effective

after the date of the enactment of this Act only to the extent that

the exclusion complies with the amendments made by this section,

except that any such waiver provided before the date of the

enactment of this Act shall remain in effect until the earlier of

the effective date of the final rules implementing the amendments

made by this section or 180 days after the date of the enactment."

REPORT ON IMPACT OF PUBLIC HOUSING LEASE AND GRIEVANCE REGULATION

ON ABILITY OF PUBLIC HOUSING AGENCIES TO TAKE ACTION AGAINST

TENANTS ENGAGING IN DRUG CRIMES

Section 5103 of Pub. L. 100-690 provided that: "The Secretary of

Housing and Urban Development shall submit to the Congress a report

on the impact of the implementation of the public housing tenancy

and administrative grievance procedure regulations issued under

section 6(k) of the United States Housing Act of 1937 (42 U.S.C.

1437d(k)) on the ability of public housing agencies to evict or

take other appropriate action against tenants engaging in criminal

activity, especially with respect to the manufacture, sale,

distribution, use, or possession of controlled substances (as

defined in section 102 of the Controlled Substances Act (21 U.S.C.

802)). The report shall be submitted not later than 12 months after

the date of the enactment of this Act [Nov. 18, 1988]."

INDIAN HOUSING

Section 1014(a)(2) of Pub. L. 100-628 provided that: "In

accordance with section 201(b)(2) of the United States Housing Act

of 1937 [former section 1437aa(b)(2) of this title], the amendments

made by paragraph (1) [amending this section] shall also apply to

public housing developed or operated pursuant to a contract between

the Secretary of Housing and Urban Development and an Indian

housing authority."

STUDY OF PAYMENTS IN LIEU OF TAXES; REPORT TO CONGRESS

Pub. L. 95-128, title II, Sec. 201(g), Oct. 12, 1977, 91 Stat.

1129, provided that the Secretary of Housing and Urban Development

conduct a study of payment in lieu of taxes made under subsec. (d)

of this section and report to the Congress on the status and

adequacy of such payments not later than 12 months after Oct. 12,

1977.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1437c-1, 1437f, 1437g,

1437j, 1437n, 1437s, 1437u, 1437v, 1437w, 1437y, 1437z, 1437z-7,

1437bbb-1, 1437bbb-5, 11907, 12705, 12742, 12755, 12899d, 13603 of

this title; title 12 sections 24, 1701z-11.

-FOOTNOTE-

(!1) So in original. Probably should be "is".

(!2) Another subpar. (I) is set out after subpar. (K).

(!3) Another subpar. (I) is set out before subpar. (J).

(!4) See References in Text note below.

(!5) So in original. The word "and" probably should not appear.

(!6) So in original. The word "this" probably should not appear.

(!7) So in original. Probably should be "(8)".

(!8) So in original. Probably should be followed by "and".

(!9) So in original. Probably should be "(B)".

(!10) See References in Text note below.

(!11) So in original. Probably should be "includes".

-End-

-CITE-

42 USC Sec. 1437e 01/06/03

-EXPCITE-

TITLE 42 - THE PUBLIC HEALTH AND WELFARE

CHAPTER 8 - LOW-INCOME HOUSING

SUBCHAPTER I - GENERAL PROGRAM OF ASSISTED HOUSING

-HEAD-

Sec. 1437e. Designated housing for elderly and disabled families

-STATUTE-

(a) Authority to provide designated housing

(1) In general

Subject only to provisions of this section and notwithstanding

any other provision of law, a public housing agency for which a

plan under subsection (d) of this section is in effect may

provide public housing projects (or portions of projects)

designated for occupancy by (A) only elderly families, (B) only

disabled families, or (C) elderly and disabled families.

(2) Priority for occupancy

In determining priority for admission to public housing

projects (or portions of projects) that are designated for

occupancy as provided in paragraph (1), the public housing agency

may make units in such projects (or portions) available only to

the types of families for whom the project is designated.

(3) Eligibility of near-elderly families

If a public housing agency determines that there are

insufficient numbers of elderly families to fill all the units in

a project (or portion of a project) designated under paragraph

(1) for occupancy by only elderly families, the agency may

provide that near-elderly families may occupy dwelling units in

the project (or portion).

(b) Standards regarding evictions

Except as provided in section 1437n(e)(1)(B) (!1) of this title,

any tenant who is lawfully residing in a dwelling unit in a public

housing project may not be evicted or otherwise required to vacate

such unit because of the designation of the project (or portion of

a project) pursuant to this section or because of any action taken

by the Secretary or any public housing agency pursuant to this

section.

(c) Relocation assistance

A public housing agency that designates any existing project or

building, or portion thereof, for occupancy as provided under

subsection (a)(1) of this section shall provide, to each person and

family who agrees to be relocated in connection with such

designation -

(1) notice of the designation and an explanation of available

relocation benefits, as soon as is practicable for the agency and

the person or family;

(2) access to comparable housing (including appropriate

services and design features), which may include tenant-based

rental assistance under section 1437f of this title, at a rental

rate paid by the tenant that is comparable to that applicable to

the unit from which the person or family has vacated; and

(3) payment of actual, reasonable moving expenses.

(d) Required plan

A plan under this subsection for designating a project (or

portion of a project) for occupancy under subsection (a)(1) of this

section is a plan, prepared by the public housing agency for the

project and submitted to the Secretary, that -

(1) establishes that the designation of the project is

necessary -

(A) to achieve the housing goals for the jurisdiction under

the comprehensive housing affordability strategy under section

12705 of this title; and

(B) to meet the housing needs of the low-income population of

the jurisdiction; and

(2) includes a description of -

(A) the project (or portion of a project) to be designated;

(B) the types of tenants for which the project is to be

designated;

(C) any supportive services to be provided to tenants of the

designated project (or portion);

(D) how the design and related facilities (as such term is

defined in section 1701q(d)(8) (!1) of title 12) of the project

accommodate the special environmental needs of the intended

occupants; and

(E) any plans to secure additional resources or housing

assistance to provide assistance to families that may have been

housed if occupancy in the project were not restricted pursuant

to this section.

For purposes of this subsection, the term "supportive services"

means services designed to meet the special needs of residents.

(e) Review of plans

(1) Review and notification

The Secretary shall conduct a limited review of each plan under

subsection (d) of this section that is submitted to the Secretary

to ensure that the plan is complete and complies with the

requirements of subsection (d) of this section. The Secretary

shall notify each public housing agency submitting a plan whether

the plan complies with such requirements not later than 60 days

after receiving the plan. If the Secretary does not notify the

public housing agency, as required under this paragraph or

paragraph (2), the plan shall be considered, for purposes of this

section, to comply with the requirements under subsection (d) of

this section and the Secretary shall be considered to have

notified the agency of such compliance upon the expiration of

such 60-day period.

(2) Notice of reasons for determination of noncompliance

If the Secretary determines that a plan, as submitted, does not

comply with the requirements under subsection (d) of this

section, the Secretary shall specify in the notice under

paragraph (1) the reasons for the noncompliance and any

modifications necessary for the plan to meet such requirements.

(3) Standards for determination of noncompliance

The Secretary may determine that a plan does not comply with

the requirements under subsection (d) of this section only if -

(A) the plan is incomplete in significant matters required

under such subsection; or

(B) there is evidence available to the Secretary that

challenges, in a substantial manner, any information provided

in the plan.

(4) Treatment of existing plans

Notwithstanding any other provision of this section, a public

housing agency shall be considered to have submitted a plan under

this subsection if the agency has submitted to the Secretary an

application and allocation plan under this section (as in effect

before March 28, 1996) that have not been approved or disapproved

before March 28, 1996.

(f) Effectiveness

(1) 5-year effectiveness of original plan

A plan under subsection (d) of this section shall be in effect

for purposes of this section during the 5-year period that begins

upon notification under subsection (e)(1) of this section of the

public housing agency that the plan complies with the

requirements under subsection (d) of this section.

(2) Renewal of plan

Upon the expiration of the 5-year period under paragraph (1) or

any 2-year period under this paragraph, an agency may extend the

effectiveness of the designation and plan for an additional

2-year period (that begins upon such expiration) by submitting to

the Secretary any information needed to update the plan. The

Secretary may not limit the number of times a public housing

agency extends the effectiveness of a designation and plan under

this paragraph.

(3) Transition provision

Any application and allocation plan approved under this section

(as in effect before March 28, 1996) before March 28, 1996, shall

be considered to be a plan under subsection (d) of this section

that is in effect for purposes of this section for the 5-year

period beginning upon such approval.

(g) Inapplicability of Uniform Relocation Assistance and Real

Property Acquisitions Policy Act of 1970

No tenant of a public housing project shall be considered to be

displaced for purposes of the Uniform Relocation Assistance and

Real Property Acquisitions Policy Act of 1970 [42 U.S.C. 4601 et

seq.] because of the designation of any existing project or

building, or portion thereof, for occupancy as provided under

subsection (a) of this section.

-SOURCE-

(Sept. 1, 1937, ch. 896, title I, Sec. 7, as added Pub. L. 93-383,

title II, Sec. 201(a), Aug. 22, 1974, 88 Stat. 662; amended Pub. L.

95-557, title IV, Sec. 412, Oct. 31, 1978, 92 Stat. 2110; Pub. L.

100-242, title I, Sec. 112(b)(3), Feb. 5, 1988, 101 Stat. 1824;

renumbered title I, Pub. L. 100-358, Sec. 5, June 29, 1988, 102

Stat. 681; amended Pub. L. 102-550, title VI, Sec. 622(a), Oct. 28,

1992, 106 Stat. 3813; Pub. L. 104-99, title IV, Sec.

402(d)(6)(A)(ii), Jan. 26, 1996, 110 Stat. 42; Pub. L. 104-120,

Sec. 10(a), Mar. 28, 1996, 110 Stat. 838; Pub. L. 104-330, title V,

Sec. 501(b)(4), Oct. 26, 1996, 110 Stat. 4042; Pub. L. 105-276,

title V, Sec. 595(d), Oct. 21, 1998, 112 Stat. 2656.)

-REFTEXT-

REFERENCES IN TEXT

Section 1437n(e)(1)(B) of this title, referred to in subsec. (b),

was repealed by Pub. L. 105-276, title V, Sec. 576(d)(2), Oct. 21,

1998, 112 Stat. 2640.

Section 1701q of title 12, referred to in subsec. (d)(2)(D), was

amended generally by Pub. L. 101-625, title VIII, Sec. 801(a), Nov.

28, 1990, 104 Stat. 4297, and, as so amended, does not contain a

subsec. (d)(8) or a definition of the term "related facilities".

The Uniform Relocation Assistance and Real Property Acquisitions

Policy Act of 1970, referred to in subsec. (g), probably means the

Uniform Relocation Assistance and Real Property Acquisition Policy

Act of 1970, Pub. L. 91-646, Jan. 2, 1971, 84 Stat. 1894, as

amended, which is classified principally to chapter 61 (Sec. 4601

et seq.) of this title. For complete classification of this Act to

the Code, see Short Title note set out under section 4601 of this

title and Tables.

-MISC1-

PRIOR PROVISIONS

A prior section 7 of act Sept. 1, 1937, ch. 896, 50 Stat. 891, as

amended, required publication of information and submission of

annual report by the Authority and was classified to section 1407

of this title, prior to the general revision of this chapter by

Pub. L. 93-383.

AMENDMENTS

1998 - Subsec. (h). Pub. L. 105-276 struck out heading and text

of subsec. (h). Text read as follows: "The provisions of this

section shall not apply with respect to low-income housing

developed or operated pursuant to a contract between the Secretary

and an Indian housing authority."

1996 - Pub. L. 104-330, Sec. 501(b)(4), which directed amendment

of "subsection 7" of the United States Housing Act of 1937,

probably meaning this section, by striking subsec. (l), could not

be executed because this section does not contain a subsec. (l).

Pub. L. 104-120 amended section generally, restating former

subsecs. (a) to (g) relating to designated housing as subsecs. (a)

to (h) relating to designated housing for elderly and disabled

families.

Subsec. (a)(2). Pub. L. 104-99, which directed the temporary

amendment of par. (2) by substituting "in accordance with the

written system of preferences for selection established pursuant

to" for "according to the preferences for occupancy under", could

not be executed because of the amendment by Pub. L. 104-120 which

amended section generally retroactive to Oct. 1, 1995. See

Effective and Termination Dates of 1996 Amendments note below.

1992 - Pub. L. 102-550 amended section generally, substituting

present provisions for provisions relating to and defining

"congregate housing" and providing for design, development, and

acquisition of congregate housing for displaced or elderly

families, limitation on amounts for contracts for congregate

housing, and costs for central dining facilities.

1988 - Pub. L. 100-242 struck out "annual" before "contributions"

in proviso.

1978 - Pub. L. 95-557 substituted "(1) low-rent housing which, as

of January 1, 1979, was built or under construction, with which

there is connected a central dining facility where wholesome and

economical meals can be served to such occupants; or (2) low-rent

housing constructed after, but not under construction prior to,

January 1, 1979, connected with which there is a central dining

facility to provide wholesome and economical meals for such

occupants. Such occupants of congregate housing may also be

provided with other supportive services appropriate to their needs

under title IV of the Housing and Community Development Amendments

of 1978" for "low-income housing (A) in which some or all of the

dwelling units do not have kitchen facilities, and (B) connected

with which there is a central dining facility to provide wholesome

and economical meals for elderly and displaced families under terms

and conditions prescribed by the public housing agency to permit a

generally self-supporting operation".

EFFECTIVE AND TERMINATION DATES OF 1996 AMENDMENTS

Amendment by Pub. L. 104-330 effective Oct. 1, 1997, except as

otherwise expressly provided, see section 107 of Pub. L. 104-330,

set out as an Effective Date note under section 4101 of Title 25,

Indians.

Amendment by Pub. L. 104-120 to be construed to have become

effective Oct. 1, 1995, notwithstanding the effective date of any

regulations issued by Secretary of Housing and Urban Development to

implement amendments by sections 9 and 10 of Pub. L. 104-120 or any

failure by Secretary to issue any such regulations, see section 13

of Pub. L. 104-120, set out as a note under section 1437d of this

title.

Amendment by Pub. L. 104-99 effective Jan. 26, 1996, only for

fiscal years 1996, 1997, and 1998, and to cease to be effective

Oct. 21, 1998, see section 402(f) of Pub. L. 104-99, as amended,

and section 514(f) of Pub. L. 105-276, set out as notes under

section 1437a of this title.

EFFECTIVE DATE OF 1992 AMENDMENT

Amendment by subtitles B through F of title VI [Secs. 621-685] of

Pub. L. 102-550 applicable upon expiration of 6-month period

beginning Oct. 28, 1992, except as otherwise provided, see section

13642 of this title.

INAPPLICABILITY OF CERTAIN 1992 AMENDMENTS TO INDIAN PUBLIC HOUSING

Amendment by Pub. L. 102-550 not applicable with respect to lower

income housing developed or operated pursuant to contract between

Secretary of Housing and Urban Development and Indian housing

authority, see section 626 of Pub. L. 102-550, set out as a note

under section 1437a of this title.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1437c-1, 8013 of this

title.

-FOOTNOTE-

(!1) See References in Text note below.

-End-

-CITE-

42 USC Sec. 1437f 01/06/03

-EXPCITE-

TITLE 42 - THE PUBLIC HEALTH AND WELFARE

CHAPTER 8 - LOW-INCOME HOUSING

SUBCHAPTER I - GENERAL PROGRAM OF ASSISTED HOUSING

-HEAD-

Sec. 1437f. Low-income housing assistance

-STATUTE-

(a) Authorization for assistance payments

For the purpose of aiding low-income families in obtaining a

decent place to live and of promoting economically mixed housing,

assistance payments may be made with respect to existing housing in

accordance with the provisions of this section.

(b) Other existing housing programs

(1) In general. - The Secretary is authorized to enter into

annual contributions contracts with public housing agencies

pursuant to which such agencies may enter into contracts to make

assistance payments to owners of existing dwelling units in

accordance with this section. In areas where no public housing

agency has been organized or where the Secretary determines that a

public housing agency is unable to implement the provisions of this

section, the Secretary is authorized to enter into such contracts

and to perform the other functions assigned to a public housing

agency by this section.

(2) The Secretary is authorized to enter into annual

contributions contracts with public housing agencies for the

purpose of replacing public housing transferred in accordance with

subchapter II-A of this chapter. Each contract entered into under

this subsection shall be for a term of not more than 60 months.

(c) Contents and purposes of contracts for assistance payments;

amount and scope of monthly assistance payments

(1) An assistance contract entered into pursuant to this section

shall establish the maximum monthly rent (including utilities and

all maintenance and management charges) which the owner is entitled

to receive for each dwelling unit with respect to which such

assistance payments are to be made. The maximum monthly rent shall

not exceed by more than 10 per centum the fair market rental

established by the Secretary periodically but not less than

annually for existing or newly constructed rental dwelling units of

various sizes and types in the market area suitable for occupancy

by persons assisted under this section, except that the maximum

monthly rent may exceed the fair market rental (A) by more than 10

but not more than 20 per centum where the Secretary determines that

special circumstances warrant such higher maximum rent or that such

higher rent is necessary to the implementation of a housing

strategy as defined in section 12705 of this title, or (B) by such

higher amount as may be requested by a tenant and approved by the

public housing agency in accordance with paragraph (3)(B). In the

case of newly constructed and substantially rehabilitated units,

the exception in the preceding sentence shall not apply to more

than 20 per centum of the total amount of authority to enter into

annual contributions contracts for such units which is allocated to

an area and obligated with respect to any fiscal year beginning on

or after October 1, 1980. Proposed fair market rentals for an area

shall be published in the Federal Register with reasonable time for

public comment, and shall become effective upon the date of

publication in final form in the Federal Register. Each fair market

rental in effect under this subsection shall be adjusted to be

effective on October 1 of each year to reflect changes, based on

the most recent available data trended so the rentals will be

current for the year to which they apply, of rents for existing or

newly constructed rental dwelling units, as the case may be, of

various sizes and types in the market area suitable for occupancy

by persons assisted under this section. Notwithstanding any other

provision of this section, after October 12, 1977, the Secretary

shall prohibit high-rise elevator projects for families with

children unless there is no practical alternative. The Secretary

shall establish separate fair market rentals under this paragraph

for Westchester County in the State of New York. The Secretary

shall also establish separate fair market rentals under this

paragraph for Monroe County in the Commonwealth of Pennsylvania. In

establishing fair market rentals for the remaining portion of the

market area in which Monroe County is located, the Secretary shall

establish the fair market rentals as if such portion included

Monroe County. If units assisted under this section are exempt from

local rent control while they are so assisted or otherwise, the

maximum monthly rent for such units shall be reasonable in

comparison with other units in the market area that are exempt from

local rent control.

(2)(A) The assistance contract shall provide for adjustment

annually or more frequently in the maximum monthly rents for units

covered by the contract to reflect changes in the fair market

rentals established in the housing area for similar types and sizes

of dwelling units or, if the Secretary determines, on the basis of

a reasonable formula. However, where the maximum monthly rent, for

a unit in a new construction, substantial rehabilitation, or

moderate rehabilitation project, to be adjusted using an annual

adjustment factor exceeds the fair market rental for an existing

dwelling unit in the market area, the Secretary shall adjust the

rent only to the extent that the owner demonstrates that the

adjusted rent would not exceed the rent for an unassisted unit of

similar quality, type, and age in the same market area, as

determined by the Secretary. The immediately foregoing sentence

shall be effective only during fiscal year 1995, fiscal year 1996

prior to April 26, 1996, and fiscal years 1997 and 1998, and during

fiscal year 1999 and thereafter. Except for assistance under the

certificate program, for any unit occupied by the same family at

the time of the last annual rental adjustment, where the assistance

contract provides for the adjustment of the maximum monthly rent by

applying an annual adjustment factor and where the rent for a unit

is otherwise eligible for an adjustment based on the full amount of

the factor, 0.01 shall be subtracted from the amount of the factor,

except that the factor shall not be reduced to less than 1.0. In

the case of assistance under the certificate program, 0.01 shall be

subtracted from the amount of the annual adjustment factor (except

that the factor shall not be reduced to less than 1.0), and the

adjusted rent shall not exceed the rent for a comparable unassisted

unit of similar quality, type, and age in the market area. The

immediately foregoing two sentences shall be effective only during

fiscal year 1995, fiscal year 1996 prior to April 26, 1996, and

fiscal years 1997 and 1998, and during fiscal year 1999 and

thereafter. In establishing annual adjustment factors for units in

new construction and substantial rehabilitation projects, the

Secretary shall take into account the fact that debt service is a

fixed expense. The immediately foregoing sentence shall be

effective only during fiscal year 1998.

(B) The contract shall further provide for the Secretary to make

additional adjustments in the maximum monthly rent for units under

contract to the extent he determines such adjustments are necessary

to reflect increases in the actual and necessary expenses of owning

and maintaining the units which have resulted from substantial

general increases in real property taxes, utility rates, or similar

costs which are not adequately compensated for by the adjustment in

the maximum monthly rent authorized by subparagraph (A). The

Secretary shall make additional adjustments in the maximum monthly

rent for units under contract (subject to the availability of

appropriations for contract amendments) to the extent the Secretary

determines such adjustments are necessary to reflect increases in

the actual and necessary expenses of owning and maintaining the

units that have resulted from the expiration of a real property tax

exemption. Where the Secretary determines that a project assisted

under this section is located in a community where drug-related

criminal activity is generally prevalent and the project's

operating, maintenance, and capital repair expenses have been

substantially increased primarily as a result of the prevalence of

such drug-related activity, the Secretary may (at the discretion of

the Secretary and subject to the availability of appropriations for

contract amendments for this purpose), on a project by project

basis, provide adjustments to the maximum monthly rents, to a level

no greater than 120 percent of the project rents, to cover the

costs of maintenance, security, capital repairs, and reserves

required for the owner to carry out a strategy acceptable to the

Secretary for addressing the problem of drug-related criminal

activity. Any rent comparability standard required under this

paragraph may be waived by the Secretary to so implement the

preceding sentence. The Secretary may (at the discretion of the

Secretary and subject to the availability of appropriations for

contract amendments), on a project by project basis for projects

receiving project-based assistance, provide adjustments to the

maximum monthly rents to cover the costs of evaluating and reducing

lead-based paint hazards, as defined in section 4851b of this

title.

(C) Adjustments in the maximum rents under subparagraphs (A) and

(B) shall not result in material differences between the rents

charged for assisted units and unassisted units of similar quality,

type, and age in the same market area, as determined by the

Secretary. In implementing the limitation established under the

preceding sentence, the Secretary shall establish regulations for

conducting comparability studies for projects where the Secretary

has reason to believe that the application of the formula

adjustments under subparagraph (A) would result in such material

differences. The Secretary shall conduct such studies upon the

request of any owner of any project, or as the Secretary determines

to be appropriate by establishing, to the extent practicable, a

modified annual adjustment factor for such market area, as the

Secretary shall designate, that is geographically smaller than the

applicable housing area used for the establishment of the annual

adjustment factor under subparagraph (A). The Secretary shall

establish such modified annual adjustment factor on the basis of

the results of a study conducted by the Secretary of the rents

charged, and any change in such rents over the previous year, for

assisted units and unassisted units of similar quality, type, and

age in the smaller market area. Where the Secretary determines that

such modified annual adjustment factor cannot be established or

that such factor when applied to a particular project would result

in material differences between the rents charged for assisted

units and unassisted units of similar quality, type, and age in the

same market area, the Secretary may apply an alternative

methodology for conducting comparability studies in order to

establish rents that are not materially different from rents

charged for comparable unassisted units. If the Secretary or

appropriate State agency does not complete and submit to the

project owner a comparability study not later than 60 days before

the anniversary date of the assistance contract under this section,

the automatic annual adjustment factor shall be applied. The

Secretary may not reduce the contract rents in effect on or after

April 15, 1987, for newly constructed, substantially rehabilitated,

or moderately rehabilitated projects assisted under this section

(including projects assisted under this section as in effect prior

to November 30, 1983), unless the project has been refinanced in a

manner that reduces the periodic payments of the owner. Any maximum

monthly rent that has been reduced by the Secretary after April 14,

1987, and prior to November 7, 1988, shall be restored to the

maximum monthly rent in effect on April 15, 1987. For any project

which has had its maximum monthly rents reduced after April 14,

1987, the Secretary shall make assistance payments (from amounts

reserved for the original contract) to the owner of such project in

an amount equal to the difference between the maximum monthly rents

in effect on April 15, 1987, and the reduced maximum monthly rents,

multiplied by the number of months that the reduced maximum monthly

rents were in effect.

(3) The amount of the monthly assistance payment with respect to

any dwelling unit shall be the difference between the maximum

monthly rent which the contract provides that the owner is to

receive for the unit and the rent the family is required to pay

under section 1437a(a) of this title. Reviews of family income

shall be made no less frequently than annually.

(4) The assistance contract shall provide that assistance

payments may be made only with respect to a dwelling unit under

lease for occupancy by a family determined to be a lower income

family at the time it initially occupied such dwelling unit, except

that such payments may be made with respect to unoccupied units for

a period not exceeding sixty days (A) in the event that a family

vacates a dwelling unit before the expiration date of the lease for

occupancy or (B) where a good faith effort is being made to fill an

unoccupied unit, and, subject to the provisions of the following

sentence, such payments may be made, in the case of a newly

constructed or substantially rehabilitated project, after such

sixty-day period in an amount equal to the debt service

attributable to such an unoccupied dwelling unit for a period not

to exceed one year, if a good faith effort is being made to fill

the unit and the unit provides decent, safe, and sanitary housing.

No such payment may be made after such sixty-day period if the

Secretary determines that the dwelling unit is in a project which

provides the owner with revenues exceeding the costs incurred by

such owner with respect to such project.

(5) The Secretary shall take such steps as may be necessary,

including the making of contracts for assistance payments in

amounts in excess of the amounts required at the time of the

initial renting of dwelling units, the reservation of annual

contributions authority for the purpose of amending housing

assistance contracts, or the allocation of a portion of new

authorizations for the purpose of amending housing assistance

contracts, to assure that assistance payments are increased on a

timely basis to cover increases in maximum monthly rents or

decreases in family incomes.

(6) Redesignated (5).

(7) Repealed. Pub. L. 105-276, title V, Sec. 550(a)(3)(C), Oct.

21, 1998, 112 Stat. 2609.

(8)(A) Not less than one year before termination of any contract

under which assistance payments are received under this section,

other than a contract for tenant-based assistance under this

section, an owner shall provide written notice to the Secretary and

the tenants involved of the proposed termination. The notice shall

also include a statement that, if the Congress makes funds

available, the owner and the Secretary may agree to a renewal of

the contract, thus avoiding termination, and that in the event of

termination the Department of Housing and Urban Development will

provide tenant-based rental assistance to all eligible residents,

enabling them to choose the place they wish to rent, which is

likely to include the dwelling unit in which they currently reside.

Any contract covered by this paragraph that is renewed may be

renewed for a period of up to 1 year or any number or years, with

payments subject to the availability of appropriations for any

year.

(B) In the event the owner does not provide the notice required,

the owner may not evict the tenants or increase the tenants' rent

payment until such time as the owner has provided the notice and 1

year has elapsed. The Secretary may allow the owner to renew the

terminating contract for a period of time sufficient to give

tenants 1 year of advance notice under such terms and conditions as

the Secretary may require.

(C) Any notice under this paragraph shall also comply with any

additional requirements established by the Secretary.

(D) For purposes of this paragraph, the term "termination" means

the expiration of the assistance contract or an owner's refusal to

renew the assistance contract, and such term shall include

termination of the contract for business reasons.

(d) Required provisions and duration of contracts for assistance

payments; waiver of limitation

(1) Contracts to make assistance payments entered into by a

public housing agency with an owner of existing housing units shall

provide (with respect to any unit) that -

(A) the selection of tenants shall be the function of the

owner, subject to the annual contributions contract between the

Secretary and the agency, except that with respect to the

certificate and moderate rehabilitation programs only, for the

purpose of selecting families to be assisted, the public housing

agency may establish local preferences, consistent with the

public housing agency plan submitted under section 1437c-1 of

this title by the public housing agency;

(B)(i) the lease between the tenant and the owner shall be for

at least one year or the term of such contract, whichever is

shorter, and shall contain other terms and conditions specified

by the Secretary;

(ii) during the term of the lease, the owner shall not

terminate the tenancy except for serious or repeated violation of

the terms and conditions of the lease, for violation of

applicable Federal, State, or local law, or for other good cause;

(iii) during the term of the lease, any criminal activity that

threatens the health, safety, or right to peaceful enjoyment of

the premises by other tenants, any criminal activity that

threatens the health, safety, or right to peaceful enjoyment of

their residences by persons residing in the immediate vicinity of

the premises, or any drug-related criminal activity on or near

such premises, engaged in by a tenant of any unit, any member of

the tenant's household, or any guest or other person under the

tenant's control, shall be cause for termination of tenancy;

(iv) any termination of tenancy shall be preceded by the

owner's provision of written notice to the tenant specifying the

grounds for such action; and

(v) it shall be cause for termination of the tenancy of a

tenant if such tenant -

(I) is fleeing to avoid prosecution, or custody or

confinement after conviction, under the laws of the place from

which the individual flees, for a crime, or attempt to commit a

crime, which is a felony under the laws of the place from which

the individual flees, or which, in the case of the State of New

Jersey, is a high misdemeanor under the laws of such State; or

(II) is violating a condition of probation or parole imposed

under Federal or State law;

(C) maintenance and replacement (including redecoration) shall

be in accordance with the standard practice for the building

concerned as established by the owner and agreed to by the

agency; and

(D) the agency and the owner shall carry out such other

appropriate terms and conditions as may be mutually agreed to by

them.

(2)(A) Each contract for an existing structure entered into under

this section shall be for a term of not less than one month nor

more than one hundred and eighty months. The Secretary shall permit

public housing agencies to enter into contracts for assistance

payments of less than 12 months duration in order to avoid

disruption in assistance to eligible families if the annual

contributions contract is within 1 year of its expiration date.

(B)(i) In determining the amount of assistance provided under an

assistance contract for project-based assistance under this

paragraph or a contract for assistance for housing constructed or

substantially rehabilitated pursuant to assistance provided under

subsection (b)(2) of this section (as such subsection existed

immediately before October 1, 1983), the Secretary may consider and

annually adjust, with respect to such project, for the cost of

employing or otherwise retaining the services of one or more

service coordinators under section 661 (!1) of the Housing and

Community Development Act of 1992 [42 U.S.C. 13631] to coordinate

the provision of any services within the project for residents of

the project who are elderly or disabled families.

(ii) The budget authority available under section 1437c(c) of

this title for assistance under this section is authorized to be

increased by $15,000,000 on or after October 1, 1992, and by

$15,000,000 on or after October 1, 1993. Amounts made available

under this subparagraph shall be used to provide additional amounts

under annual contributions contracts for assistance under this

section which shall be made available through assistance contracts

only for the purpose of providing service coordinators under clause

(i) for projects receiving project-based assistance under this

paragraph and to provide additional amounts under contracts for

assistance for projects constructed or substantially rehabilitated

pursuant to assistance provided under subsection (b)(2) of this

section (as such subsection existed immediately before October 1,

1983) only for such purpose.

(C) An assistance contract for project-based assistance under

this paragraph shall provide that the owner shall ensure and

maintain compliance with subtitle C of title VI of the Housing and

Community Development Act of 1992 [42 U.S.C. 13601 et seq.] and any

regulations issued under such subtitle.

(D) An owner of a covered section 8 housing project (as such term

is defined in section 659 of the Housing and Community Development

Act of 1992 [42 U.S.C. 13619]) may give preference for occupancy of

dwelling units in the project, and reserve units for occupancy, in

accordance with subtitle D of title VI of the Housing and Community

Development Act of 1992 [42 U.S.C. 13611 et seq.].

(3) Notwithstanding any other provision of law, with the approval

of the Secretary the public housing agency administering a contract

under this section with respect to existing housing units may

exercise all management and maintenance responsibilities with

respect to those units pursuant to a contract between such agency

and the owner of such units.

(4) A public housing agency that serves more than one unit of

general local government may, at the discretion of the agency, in

allocating assistance under this section, give priority to disabled

families that are not elderly families.

(5) Calculation of limit. - Any contract entered into under

section 514 of the Multifamily Assisted Housing Reform and

Affordability Act of 1997 shall be excluded in computing the limit

on project-based assistance under this subsection.

(6) Treatment of common areas. - The Secretary may not provide

any assistance amounts pursuant to an existing contract for

project-based assistance under this section for a housing project

and may not enter into a new or renewal contract for such

assistance for a project unless the owner of the project provides

consent, to such local law enforcement agencies as the Secretary

determines appropriate, for law enforcement officers of such

agencies to enter common areas of the project at any time and

without advance notice upon a determination of probable cause by

such officers that criminal activity is taking place in such areas.

(e) Restrictions on contracts for assistance payments

(1) Nothing in this chapter shall be deemed to prohibit an owner

from pledging, or offering as security for any loan or obligation,

a contract for assistance payments entered into pursuant to this

section: Provided, That such security is in connection with a

project constructed or rehabilitated pursuant to authority granted

in this section, and the terms of the financing or any refinancing

have been approved by the Secretary.

(2) Repealed. Pub. L. 101-625, title II, Sec. 289(b), Nov. 28,

1990, 104 Stat. 4128.

(f) Definitions

As used in this section -

(1) the term "owner" means any private person or entity,

including a cooperative, an agency of the Federal Government, or

a public housing agency, having the legal right to lease or

sublease dwelling units;

(2) the terms "rent" or "rental" mean, with respect to members

of a cooperative, the charges under the occupancy agreements

between such members and the cooperative;

(3) the term "debt service" means the required payments for

principal and interest made with respect to a mortgage secured by

housing assisted under this chapter;

(4) the term "participating jurisdiction" means a State or unit

of general local government designated by the Secretary to be a

participating jurisdiction under title II of the

Cranston-Gonzalez National Affordable Housing Act [42 U.S.C.

12721 et seq.];

(5) the term "drug-related criminal activity" means the illegal

manufacture, sale, distribution, use, or possession with intent

to manufacture, sell, distribute, or use, of a controlled

substance (as defined in section 802 of title 21);

(6) the term "project-based assistance" means rental assistance

under subsection (b) of this section that is attached to the

structure pursuant to subsection (d)(2) or (o)(13) of this

section; and

(7) the term "tenant-based assistance" means rental assistance

under subsection (o) of this section that is not project-based

assistance and that provides for the eligible family to select

suitable housing and to move to other suitable housing.

(g) Regulations applicable for implementation of assistance

payments

Notwithstanding any other provision of this chapter, assistance

payments under this section may be provided, in accordance with

regulations prescribed by the Secretary, with respect to some or

all of the units in any project approved pursuant to section 1701q

of title 12.

(h) Nonapplicability of inconsistent provisions to contracts for

assistance payments

Sections 1437c(e) and 1437d of this title (except as provided in

section 1437d(j)(3) of this title), and any other provisions of

this chapter which are inconsistent with the provisions of this

section shall not apply to contracts for assistance entered into

under this section.

(i) Receipt of assistance by public housing agency under other law

not to be considered

The Secretary may not consider the receipt by a public housing

agency of assistance under section 811(b)(1) of the

Cranston-Gonzalez National Affordable Housing Act [42 U.S.C.

8013(b)(1)], or the amount received, in approving assistance for

the agency under this section or determining the amount of such

assistance to be provided.

(j) Repealed. Pub. L. 105-276, title V, Sec. 550(a)(6), Oct. 21,

1998, 112 Stat. 2609

(k) Verification of income

The Secretary shall establish procedures which are appropriate

and necessary to assure that income data provided to public housing

agencies and owners by families applying for or receiving

assistance under this section is complete and accurate. In

establishing such procedures, the Secretary shall randomly,

regularly, and periodically select a sample of families to

authorize the Secretary to obtain information on these families for

the purpose of income verification, or to allow those families to

provide such information themselves. Such information may include,

but is not limited to, data concerning unemployment compensation

and Federal income taxation and data relating to benefits made

available under the Social Security Act [42 U.S.C. 301 et seq.],

the Food Stamp Act of 1977 [7 U.S.C. 2011 et seq.], or title 38.

Any such information received pursuant to this subsection shall

remain confidential and shall be used only for the purpose of

verifying incomes in order to determine eligibility of families for

benefits (and the amount of such benefits, if any) under this

section.

(l), (m) Repealed. Pub. L. 98-181, title II, Sec. 209(a)(5), Nov.

30, 1983, 97 Stat. 1183

(n) Repealed. Pub. L. 105-276, title V, Sec. 550(a)(7), Oct. 21,

1998, 112 Stat. 2609

(o) Voucher program

(1) Authority

(A) In general

The Secretary may provide assistance to public housing

agencies for tenant-based assistance using a payment standard

established in accordance with subparagraph (B). The payment

standard shall be used to determine the monthly assistance that

may be paid for any family, as provided in paragraph (2).

(B) Establishment of payment standard

Except as provided under subparagraph (D), the payment

standard for each size of dwelling unit in a market area shall

not exceed 110 percent of the fair market rental established

under subsection (c) of this section for the same size of

dwelling unit in the same market area and shall be not less

than 90 percent of that fair market rental.

(C) Set-aside

The Secretary may set aside not more than 5 percent of the

budget authority made available for assistance under this

subsection as an adjustment pool. The Secretary shall use

amounts in the adjustment pool to make adjusted payments to

public housing agencies under subparagraph (A), to ensure

continued affordability, if the Secretary determines that

additional assistance for such purpose is necessary, based on

documentation submitted by a public housing agency.

(D) Approval

The Secretary may require a public housing agency to submit

the payment standard of the public housing agency to the

Secretary for approval, if the payment standard is less than 90

percent of the fair market rental or exceeds 110 percent of the

fair market rental.

(E) Review

The Secretary -

(i) shall monitor rent burdens and review any payment

standard that results in a significant percentage of the

families occupying units of any size paying more than 30

percent of adjusted income for rent; and

(ii) may require a public housing agency to modify the

payment standard of the public housing agency based on the

results of that review.

(2) Amount of monthly assistance payment

Subject to the requirement under section 1437a(a)(3) of this

title (relating to minimum rental amount), the monthly assistance

payment for a family receiving assistance under this subsection

shall be determined as follows:

(A) Tenant-based assistance; rent not exceeding payment

standard

For a family receiving tenant-based assistance, if the rent

for the family (including the amount allowed for tenant-paid

utilities) does not exceed the applicable payment standard

established under paragraph (1), the monthly assistance payment

for the family shall be equal to the amount by which the rent

(including the amount allowed for tenant-paid utilities)

exceeds the greatest of the following amounts, rounded to the

nearest dollar:

(i) 30 percent of the monthly adjusted income of the

family.

(ii) 10 percent of the monthly income of the family.

(iii) If the family is receiving payments for welfare

assistance from a public agency and a part of those payments,

adjusted in accordance with the actual housing costs of the

family, is specifically designated by that agency to meet the

housing costs of the family, the portion of those payments

that is so designated.

(B) Tenant-based assistance; rent exceeding payment standard

For a family receiving tenant-based assistance, if the rent

for the family (including the amount allowed for tenant-paid

utilities) exceeds the applicable payment standard established

under paragraph (1), the monthly assistance payment for the

family shall be equal to the amount by which the applicable

payment standard exceeds the greatest of amounts under clauses

(i), (ii), and (iii) of subparagraph (A).

(C) Families receiving project-based assistance

For a family receiving project-based assistance, the rent

that the family is required to pay shall be determined in

accordance with section 1437a(a)(1) of this title, and the

amount of the housing assistance payment shall be determined in

accordance with subsection (c)(3) of this section.

(3) 40 percent limit

At the time a family initially receives tenant-based assistance

under this section with respect to any dwelling unit, the total

amount that a family may be required to pay for rent may not

exceed 40 percent of the monthly adjusted income of the family.

(4) Eligible families

To be eligible to receive assistance under this subsection, a

family shall, at the time a family initially receives assistance

under this subsection, be a low-income family that is -

(A) a very low-income family;

(B) a family previously assisted under this subchapter;

(C) a low-income family that meets eligibility criteria

specified by the public housing agency;

(D) a family that qualifies to receive a voucher in

connection with a homeownership program approved under title IV

of the Cranston-Gonzalez National Affordable Housing Act; or

(E) a family that qualifies to receive a voucher under

section 223 or 226 of the Low-Income Housing Preservation and

Resident Homeownership Act of 1990 [12 U.S.C. 4113, 4116].

(5) Annual review of family income

(A) In general

Reviews of family incomes for purposes of this section shall

be subject to the provisions of section 3544 of this title and

shall be conducted upon the initial provision of housing

assistance for the family and thereafter not less than

annually.

(B) Procedures

Each public housing agency administering assistance under

this subsection shall establish procedures that are appropriate

and necessary to ensure that income data provided to the agency

and owners by families applying for or receiving assistance

from the agency is complete and accurate. Each public housing

agency shall, not less frequently than annually, conduct a

review of the family income of each family receiving assistance

under this subsection.

(6) Selection of families and disapproval of owners

(A) Preferences

(i) Authority to establish

Each public housing agency may establish a system for

making tenant-based assistance under this subsection

available on behalf of eligible families that provides

preference for such assistance to eligible families having

certain characteristics, which may include a preference for

families residing in public housing who are victims of a

crime of violence (as such term is defined in section 16 of

title 18) that has been reported to an appropriate law

enforcement agency.

(ii) Content

Each system of preferences established pursuant to this

subparagraph shall be based upon local housing needs and

priorities, as determined by the public housing agency using

generally accepted data sources, including any information

obtained pursuant to an opportunity for public comment as

provided under section 1437c-1(f) of this title and under the

requirements applicable to the comprehensive housing

affordability strategy for the relevant jurisdiction.

(B) Selection of tenants

Each housing assistance payment contract entered into by the

public housing agency and the owner of a dwelling unit) (!2)

shall provide that the screening and selection of families for

those units shall be the function of the owner. In addition,

the public housing agency may elect to screen applicants for

the program in accordance with such requirements as the

Secretary may establish.

(C) PHA disapproval of owners

In addition to other grounds authorized by the Secretary, a

public housing agency may elect not to enter into a housing

assistance payments contract under this subsection with an

owner who refuses, or has a history of refusing, to take action

to terminate tenancy for activity engaged in by the tenant, any

member of the tenant's household, any guest, or any other

person under the control of any member of the household that -

(i) threatens the health or safety of, or right to peaceful

enjoyment of the premises by, other tenants or employees of

the public housing agency, owner, or other manager of the

housing;

(ii) threatens the health or safety of, or right to

peaceful enjoyment of the residences by, persons residing in

the immediate vicinity of the premises; or

(iii) is drug-related or violent criminal activity.

(7) Leases and tenancy

Each housing assistance payment contract entered into by the

public housing agency and the owner of a dwelling unit -

(A) shall provide that the lease between the tenant and the

owner shall be for a term of not less than 1 year, except that

the public housing agency may approve a shorter term for an

initial lease between the tenant and the dwelling unit owner if

the public housing agency determines that such shorter term

would improve housing opportunities for the tenant and if such

shorter term is considered to be a prevailing local market

practice;

(B) shall provide that the dwelling unit owner shall offer

leases to tenants assisted under this subsection that -

(i) are in a standard form used in the locality by the

dwelling unit owner; and

(ii) contain terms and conditions that -

(I) are consistent with State and local law; and

(II) apply generally to tenants in the property who are

not assisted under this section;

(C) shall provide that during the term of the lease, the

owner shall not terminate the tenancy except for serious or

repeated violation of the terms and conditions of the lease,

for violation of applicable Federal, State, or local law, or

for other good cause;

(D) shall provide that during the term of the lease, any

criminal activity that threatens the health, safety, or right

to peaceful enjoyment of the premises by other tenants, any

criminal activity that threatens the health, safety, or right

to peaceful enjoyment of their residences by persons residing

in the immediate vicinity of the premises, or any violent or

drug-related criminal activity on or near such premises,

engaged in by a tenant of any unit, any member of the tenant's

household, or any guest or other person under the tenant's

control, shall be cause for termination of tenancy;

(E) shall provide that any termination of tenancy under this

subsection shall be preceded by the provision of written notice

by the owner to the tenant specifying the grounds for that

action, and any relief shall be consistent with applicable

State and local law; and

(F) may include any addenda required by the Secretary to set

forth the provisions of this subsection.

(8) Inspection of units by PHAs

(A) In general

Except as provided in paragraph (11), for each dwelling unit

for which a housing assistance payment contract is established

under this subsection, the public housing agency shall inspect

the unit before any assistance payment is made to determine

whether the dwelling unit meets the housing quality standards

under subparagraph (B).

(B) Housing quality standards

The housing quality standards under this subparagraph are

standards for safe and habitable housing established -

(i) by the Secretary for purposes of this subsection; or

(ii) by local housing codes or by codes adopted by public

housing agencies that -

(I) meet or exceed housing quality standards, except that

the Secretary may waive the requirement under this

subclause to significantly increase access to affordable

housing and to expand housing opportunities for families

assisted under this subsection, except where such waiver

could adversely affect the health or safety of families

assisted under this subsection; and

(II) do not severely restrict housing choice (!3)

(C) Inspection

The determination required under subparagraph (A) shall be

made by the public housing agency (or other entity, as provided

in paragraph (11)) pursuant to an inspection of the dwelling

unit conducted before any assistance payment is made for the

unit. Inspections of dwelling units under this subparagraph

shall be made before the expiration of the 15-day period

beginning upon a request by the resident or landlord to the

public housing agency or, in the case of any public housing

agency that provides assistance under this subsection on behalf

of more than 1250 families, before the expiration of a

reasonable period beginning upon such request. The performance

of the agency in meeting the 15-day inspection deadline shall

be taken into consideration in assessing the performance of the

agency.

(D) Annual inspections

Each public housing agency providing assistance under this

subsection (or other entity, as provided in paragraph (11))

shall make an annual inspection of each assisted dwelling unit

during the term of the housing assistance payments contract for

the unit to determine whether the unit is maintained in

accordance with the requirements under subparagraph (A). The

agency (or other entity) shall retain the records of the

inspection for a reasonable time and shall make the records

available upon request to the Secretary, the Inspector General

for the Department of Housing and Urban Development, and any

auditor conducting an audit under section 1437c(h) of this

title.

(E) Inspection guidelines

The Secretary shall establish procedural guidelines and

performance standards to facilitate inspections of dwelling

units and conform such inspections with practices utilized in

the private housing market. Such guidelines and standards shall

take into consideration variations in local laws and practices

of public housing agencies and shall provide flexibility to

authorities appropriate to facilitate efficient provision of

assistance under this subsection.

(9) Vacated units

If an assisted family vacates a dwelling unit for which rental

assistance is provided under a housing assistance payment

contract before the expiration of the term of the lease for the

unit, rental assistance pursuant to such contract may not be

provided for the unit after the month during which the unit was

vacated.

(10) Rent

(A) Reasonableness

The rent for dwelling units for which a housing assistance

payment contract is established under this subsection shall be

reasonable in comparison with rents charged for comparable

dwelling units in the private, unassisted local market.

(B) Negotiations

A public housing agency (or other entity, as provided in

paragraph (11)) shall, at the request of a family receiving

tenant-based assistance under this subsection, assist that

family in negotiating a reasonable rent with a dwelling unit

owner. A public housing agency (or such other entity) shall

review the rent for a unit under consideration by the family

(and all rent increases for units under lease by the family) to

determine whether the rent (or rent increase) requested by the

owner is reasonable. If a public housing agency (or other such

entity) determines that the rent (or rent increase) for a

dwelling unit is not reasonable, the public housing agency (or

other such entity) shall not make housing assistance payments

to the owner under this subsection with respect to that unit.

(C) Units exempt from local rent control

If a dwelling unit for which a housing assistance payment

contract is established under this subsection is exempt from

local rent control provisions during the term of that contract,

the rent for that unit shall be reasonable in comparison with

other units in the market area that are exempt from local rent

control provisions.

(D) Timely payments

Each public housing agency shall make timely payment of any

amounts due to a dwelling unit owner under this subsection. The

housing assistance payment contract between the owner and the

public housing agency may provide for penalties for the late

payment of amounts due under the contract, which shall be

imposed on the public housing agency in accordance with

generally accepted practices in the local housing market.

(E) Penalties

Unless otherwise authorized by the Secretary, each public

housing agency shall pay any penalties from administrative fees

collected by the public housing agency, except that no penalty

shall be imposed if the late payment is due to factors that the

Secretary determines are beyond the control of the public

housing agency.

(11) Leasing of units owned by PHA

If an eligible family assisted under this subsection leases a

dwelling unit (other than a public housing dwelling unit) that is

owned by a public housing agency administering assistance under

this subsection, the Secretary shall require the unit of general

local government or another entity approved by the Secretary, to

make inspections required under paragraph (8) and rent

determinations required under paragraph (10). The agency shall be

responsible for any expenses of such inspections and

determinations.

(12) Assistance for rental of manufactured housing

(A) In general

A public housing agency may make assistance payments in

accordance with this subsection on behalf of a family that

utilizes a manufactured home as a principal place of residence.

Such payments may be made only for the rental of the real

property on which the manufactured home owned by any such

family is located.

(B) Rent calculation

(i) Charges included

For assistance pursuant to this paragraph, the rent for the

space on which a manufactured home is located and with

respect to which assistance payments are to be made shall

include maintenance and management charges and tenant-paid

utilities.

(ii) Payment standard

The public housing agency shall establish a payment

standard for the purpose of determining the monthly

assistance that may be paid for any family under this

paragraph. The payment standard may not exceed an amount

approved or established by the Secretary.

(iii) Monthly assistance payment

The monthly assistance payment for a family assisted under

this paragraph shall be determined in accordance with

paragraph (2).

(13) PHA project-based assistance

(A) In general

A public housing agency may use amounts provided under an

annual contributions contract under this subsection to enter

into a housing assistance payment contract with respect to an

existing, newly constructed, or rehabilitated structure, that

is attached to the structure, subject to the limitations and

requirements of this paragraph.

(B) Percentage limitation

Not more than 20 percent of the funding available for

tenant-based assistance under this section that is administered

by the agency may be attached to structures pursuant to this

paragraph.

(C) Consistency with PHA plan and other goals

A public housing agency may approve a housing assistance

payment contract pursuant to this paragraph only if the

contract is consistent with -

(i) the public housing agency plan for the agency approved

under section 1437c-1 of this title; and

(ii) the goal of deconcentrating poverty and expanding

housing and economic opportunities.

(D) Income mixing requirement

(i) In general

Not more than 25 percent of the dwelling units in any

building may be assisted under a housing assistance payment

contract for project-based assistance pursuant to this

paragraph.

(ii) Exceptions

The limitation under clause (i) shall not apply in the case

of assistance under a contract for housing consisting of

single family properties or for dwelling units that are

specifically made available for households comprised of

elderly families, disabled families, and families receiving

supportive services.

(E) Resident choice requirement

A housing assistance payment contract pursuant to this

paragraph shall provide as follows:

(i) Mobility

Each low-income family occupying a dwelling unit assisted

under the contract may move from the housing at any time

after the family has occupied the dwelling unit for 12

months.

(ii) Continued assistance

Upon such a move, the public housing agency shall provide

the low-income family with tenant-based rental assistance

under this section or such other tenant-based rental

assistance that is subject to comparable income, assistance,

rent contribution, affordability, and other requirements, as

the Secretary shall provide by regulation. If such rental

assistance is not immediately available to fulfill the

requirement under the preceding sentence with respect to a

low-income family, such requirement may be met by providing

the family priority to receive the next voucher or other

tenant-based rental assistance amounts that become available

under the program used to fulfill such requirement.

(F) Contract term

A housing assistance payment contract pursuant to this

paragraph between a public housing agency and the owner of a

structure may have a term of up to 10 years, subject to the

availability of sufficient appropriated funds for the purpose

of renewing expiring contracts for assistance payments, as

provided in appropriations Acts and in the agency's annual

contributions contract with the Secretary, and to annual

compliance with the inspection requirements under paragraph

(8), except that the agency shall not be required to make

annual inspections of each assisted unit in the development.

The contract may specify additional conditions for its

continuation. If the units covered by the contract are owned by

the agency, the term of the contract shall be agreed upon by

the agency and the unit of general local government or other

entity approved by the Secretary in the manner provided under

paragraph (11).

(G) Extension of contract term

A public housing agency may enter into a contract with the

owner of a structure assisted under a housing assistance

payment contract pursuant to this paragraph to extend the term

of the underlying housing assistance payment contract for such

period as the agency determines to be appropriate to achieve

long-term affordability of the housing or to expand housing

opportunities. Such a contract shall provide that the extension

of such term shall be contingent upon the future availability

of appropriated funds for the purpose of renewing expiring

contracts for assistance payments, as provided in

appropriations Acts, and may obligate the owner to have such

extensions of the underlying housing assistance payment

contract accepted by the owner and the successors in interest

of the owner.

(H) Rent calculation

A housing assistance payment contract pursuant to this

paragraph shall establish rents for each unit assisted in an

amount that does not exceed 110 percent of the applicable fair

market rental (or any exception payment standard approved by

the Secretary pursuant to paragraph (1)(D)), except that if a

contract covers a dwelling unit that has been allocated

low-income housing tax credits pursuant to section 42 of title

26 and is not located in a qualified census tract (as such term

is defined in subsection (d) of such section 42), the rent for

such unit may be established at any level that does not exceed

the rent charged for comparable units in the building that also

receive the low-income housing tax credit but do not have

additional rental assistance. The rents established by housing

assistance payment contracts pursuant to this paragraph may

vary from the payment standards established by the public

housing agency pursuant to paragraph (1)(B), but shall be

subject to paragraph (10)(A).

(I) Rent adjustments

A housing assistance payments contract pursuant to this

paragraph shall provide for rent adjustments, except that -

(i) the adjusted rent for any unit assisted shall be

reasonable in comparison with rents charged for comparable

dwelling units in the private, unassisted, local market and

may not exceed the maximum rent permitted under subparagraph

(H); and

(ii) the provisions of subsection (c)(2)(C) of this section

shall not apply.

(J) Tenant selection

A public housing agency shall select families to receive

project-based assistance pursuant to this paragraph from its

waiting list for assistance under this subsection. Eligibility

for such project-based assistance shall be subject to the

provisions of section 1437n(b) of this title that apply to

tenant-based assistance. The agency may establish preferences

or criteria for selection for a unit assisted under this

paragraph that are consistent with the public housing agency

plan for the agency approved under section 1437c-1 of this

title. Any family that rejects an offer of project-based

assistance under this paragraph or that is rejected for

admission to a structure by the owner or manager of a structure

assisted under this paragraph shall retain its place on the

waiting list as if the offer had not been made. The owner or

manager of a structure assisted under this paragraph shall not

admit any family to a dwelling unit assisted under a contract

pursuant to this paragraph other than a family referred by the

public housing agency from its waiting list. Subject to its

waiting list policies and selection preferences, a public

housing agency may place on its waiting list a family referred

by the owner or manager of a structure and may maintain a

separate waiting list for assistance under this paragraph, but

only if all families on the agency's waiting list for

assistance under this subsection are permitted to place their

names on the separate list.

(K) Vacated units

Notwithstanding paragraph (9), a housing assistance payment

contract pursuant to this paragraph may provide as follows:

(i) Payment for vacant units

That the public housing agency may, in its discretion,

continue to provide assistance under the contract, for a

reasonable period not exceeding 60 days, for a dwelling unit

that becomes vacant, but only: (I) if the vacancy was not the

fault of the owner of the dwelling unit; and (II) the agency

and the owner take every reasonable action to minimize the

likelihood and extent of any such vacancy. Rental assistance

may not be provided for a vacant unit after the expiration of

such period.

(ii) Reduction of contract

That, if despite reasonable efforts of the agency and the

owner to fill a vacant unit, no eligible family has agreed to

rent the unit within 120 days after the owner has notified

the agency of the vacancy, the agency may reduce its housing

assistance payments contract with the owner by the amount

equivalent to the remaining months of subsidy attributable to

the vacant unit. Amounts deobligated pursuant to such a

contract provision shall be available to the agency to

provide assistance under this subsection.

Eligible applicants for assistance under this subsection may

enforce provisions authorized by this subparagraph.

(14) Inapplicability to tenant-based assistance

Subsection (c) of this section shall not apply to tenant-based

assistance under this subsection.

(15) Homeownership option

(A) In general

A public housing agency providing assistance under this

subsection may, at the option of the agency, provide assistance

for homeownership under subsection (y) of this section.

(B) Alternative administration

A public housing agency may contract with a nonprofit

organization to administer a homeownership program under

subsection (y) of this section.

(16) Rental vouchers for relocation of witnesses and victims of

crime

(A) Witnesses

Of amounts made available for assistance under this

subsection in each fiscal year, the Secretary, in consultation

with the Inspector General, shall make available such sums as

may be necessary for the relocation of witnesses in connection

with efforts to combat crime in public and assisted housing

pursuant to requests from law enforcement or prosecution

agencies.

(B) Victims of crime

(i) In general

Of amounts made available for assistance under this section

in each fiscal year, the Secretary shall make available such

sums as may be necessary for the relocation of families

residing in public housing who are victims of a crime of

violence (as that term is defined in section 16 of title 18)

that has been reported to an appropriate law enforcement

agency.

(ii) Notice

A public housing agency that receives amounts under this

subparagraph shall establish procedures for providing notice

of the availability of that assistance to families that may

be eligible for that assistance.

(17) Deed restrictions

Assistance under this subsection may not be used in any manner

that abrogates any local deed restriction that applies to any

housing consisting of 1 to 4 dwelling units. This paragraph may

not be construed to affect the provisions or applicability of the

Fair Housing Act [42 U.S.C. 3601 et seq.].

(18) Rental assistance for assisted living facilities

(A) In general

A public housing agency may make assistance payments on

behalf of a family that uses an assisted living facility as a

principal place of residence and that uses such supportive

services made available in the facility as the agency may

require. Such payments may be made only for covering costs of

rental of the dwelling unit in the assisted living facility and

not for covering any portion of the cost of residing in such

facility that is attributable to service relating to assisted

living.

(B) Rent calculation

(i) Charges included

For assistance pursuant to this paragraph, the rent of the

dwelling unit that is an assisted living facility with

respect to which assistance payments are made shall include

maintenance and management charges related to the dwelling

unit and tenant-paid utilities. Such rent shall not include

any charges attributable to services relating to assisted

living.

(ii) Payment standard

In determining the monthly assistance that may be paid

under this paragraph on behalf of any family residing in an

assisted living facility, the public housing agency shall

utilize the payment standard established under paragraph (1),

for the market area in which the assisted living facility is

located, for the applicable size dwelling unit.

(iii) Monthly assistance payment

The monthly assistance payment for a family assisted under

this paragraph shall be determined in accordance with

paragraph (2) (using the rent and payment standard for the

dwelling unit as determined in accordance with this

subsection).

(C) Definition

For the purposes of this paragraph, the term "assisted living

facility" has the meaning given that term in section 232(b) of

the National Housing Act (12 U.S.C. 1715w(b)), except that such

a facility may be contained within a portion of a larger

multifamily housing project.

(19) Rental vouchers for Veterans Affairs supported housing

program

(A) Set aside

Subject to subparagraph (C), the Secretary shall set aside,

from amounts made available for rental assistance under this

subsection, the amounts specified in subparagraph (B) for use

only for providing such assistance through a supported housing

program administered in conjunction with the Department of

Veterans Affairs. Such program shall provide rental assistance

on behalf of homeless veterans who have chronic mental

illnesses or chronic substance use disorders, shall require

agreement of the veteran to continued treatment for such mental

illness or substance use disorder as a condition of receipt of

such rental assistance, and shall ensure such treatment and

appropriate case management for each veteran receiving such

rental assistance.

(B) Amount

The amount specified in this subparagraph is -

(i) for fiscal year 2003, the amount necessary to provide

500 vouchers for rental assistance under this subsection;

(ii) for fiscal year 2004, the amount necessary to provide

1,000 vouchers for rental assistance under this subsection;

(iii) for fiscal year 2005, the amount necessary to provide

1,500 vouchers for rental assistance under this subsection;

and

(iv) for fiscal year 2006, the amount necessary to provide

2,000 vouchers for rental assistance under this subsection.

(C) Funding through incremental assistance

In any fiscal year, to the extent that this paragraph

requires the Secretary to set aside rental assistance amounts

for use under this paragraph in an amount that exceeds the

amount set aside in the preceding fiscal year, such requirement

shall be effective only to such extent or in such amounts as

are or have been provided in appropriation Acts for such fiscal

year for incremental rental assistance under this subsection.

(p) Shared housing for elderly and handicapped

In order to assist elderly families (as defined in section

1437a(b)(3) of this title who elect to live in a shared housing

arrangement in which they benefit as a result of sharing the

facilities of a dwelling with others in a manner that effectively

and efficiently meets their housing needs and thereby reduces their

cost of housing, the Secretary shall permit assistance provided

under the existing housing and moderate rehabilitation programs to

be used by such families in such arrangements. In carrying out this

subsection, the Secretary shall issue minimum habitability

standards for the purpose of assuring decent, safe, and sanitary

housing for such families while taking into account the special

circumstances of shared housing.

(q) Administrative fees

(1) Fee for ongoing costs of administration

(A) In general

The Secretary shall establish fees for the costs of

administering the tenant-based assistance, certificate,

voucher, and moderate rehabilitation programs under this

section.

(B) Fiscal year 1999

(i) Calculation

For fiscal year 1999, the fee for each month for which a

dwelling unit is covered by an assistance contract shall be -

(I) in the case of a public housing agency that, on an

annual basis, is administering a program for not more than

600 dwelling units, 7.65 percent of the base amount; and

(II) in the case of an agency that, on an annual basis,

is administering a program for more than 600 dwelling units

(aa) for the first 600 units, 7.65 percent of the base

amount, and (bb) for any additional dwelling units under

the program, 7.0 percent of the base amount.

(ii) Base amount

For purposes of this subparagraph, the base amount shall be

the higher of -

(I) the fair market rental established under subsection

(c) of this section (as in effect immediately before the

effective date under section 503(a) of the Quality Housing

and Work Responsibility Act of 1998) for fiscal year 1993

for a 2-bedroom existing rental dwelling unit in the market

area of the agency, and

(II) the amount that is the lesser of (aa) such fair

market rental for fiscal year 1994, or (bb) 103.5 percent

of the amount determined under clause (i),

adjusted based on changes in wage data or other objectively

measurable data that reflect the costs of administering the

program, as determined by the Secretary. The Secretary may

require that the base amount be not less than a minimum

amount and not more than a maximum amount.

(C) Subsequent fiscal years

For subsequent fiscal years, the Secretary shall publish a

notice in the Federal Register, for each geographic area,

establishing the amount of the fee that would apply for public

housing agencies administering the program, based on changes in

wage data or other objectively measurable data that reflect the

costs of administering the program, as determined by the

Secretary.

(D) Increase

The Secretary may increase the fee if necessary to reflect

the higher costs of administering small programs and programs

operating over large geographic areas.

(E) Decrease

The Secretary may decrease the fee for units owned by a

public housing agency to reflect reasonable costs of

administration.

(2) Fee for preliminary expenses

The Secretary shall also establish reasonable fees (as

determined by the Secretary) for -

(A) the costs of preliminary expenses, in the amount of $500,

for a public housing agency, except that such fee shall apply

to an agency only in the first year that the agency administers

a tenant-based assistance program under this section, and only

if, immediately before the effective date under section 503(a)

of the Quality Housing and Work Responsibility Act of 1998, the

agency was not administering a tenant-based assistance program

under this chapter (as in effect immediately before such

effective date), in connection with its initial increment of

assistance received;

(B) the costs incurred in assisting families who experience

difficulty (as determined by the Secretary) in obtaining

appropriate housing under the programs; and

(C) extraordinary costs approved by the Secretary.

(3) Transfer of fees in cases of concurrent geographical

jurisdiction

In each fiscal year, if any public housing agency provides

tenant-based assistance under this section on behalf of a family

who uses such assistance for a dwelling unit that is located

within the jurisdiction of such agency but is also within the

jurisdiction of another public housing agency, the Secretary

shall take such steps as may be necessary to ensure that the

public housing agency that provides the services for a family

receives all or part of the administrative fee under this section

(as appropriate).

(4) Applicability

This subsection shall apply to fiscal year 1999 and fiscal

years thereafter.

(r) Portability

(1) In general. - (A) Any family receiving tenant-based

assistance under subsection (o) of this section may receive such

assistance to rent an eligible dwelling unit if the dwelling unit

to which the family moves is within any area in which a program is

being administered under this section.

(B)(i) Notwithstanding subparagraph (A) and subject to any

exceptions established under clause (ii) of this subparagraph, a

public housing agency may require that any family not living within

the jurisdiction of the public housing agency at the time the

family applies for assistance from the agency shall, during the

12-month period beginning on the date of initial receipt of housing

assistance made available on behalf of the family from such agency,

lease and occupy an eligible dwelling unit located within the

jurisdiction served by the agency.

(ii) The Secretary may establish such exceptions to the authority

of public housing agencies established under clause (i).

(2) The public housing agency having authority with respect to

the dwelling unit to which a family moves under this subsection

shall have the responsibility of carrying out the provisions of

this subsection with respect to the family.

(3) In providing assistance under subsection (o) of this section

for any fiscal year, the Secretary shall give consideration to any

reduction in the number of resident families incurred by a public

housing agency in the preceding fiscal year as a result of the

provisions of this subsection. The Secretary shall establish

procedures for the compensation of public housing agencies that

issue vouchers to families that move into or out of the

jurisdiction of the public housing agency under portability

procedures. The Secretary may reserve amounts available for

assistance under subsection (o) of this section to compensate those

public housing agencies.

(4) The provisions of this subsection may not be construed to

restrict any authority of the Secretary under any other provision

of law to provide for the portability of assistance under this

section.

(5) Lease violations. - A family may not receive a voucher from a

public housing agency and move to another jurisdiction under the

tenant-based assistance program if the family has moved out of the

assisted dwelling unit of the family in violation of a lease.

(s) Prohibition of denial of certificates and vouchers to residents

of public housing

In selecting families for the provision of assistance under this

section (including subsection (o) of this section), a public

housing agency may not exclude or penalize a family solely because

the family resides in a public housing project.

(t) Enhanced vouchers

(1) In general

Enhanced voucher assistance under this subsection for a family

shall be voucher assistance under subsection (o) of this section,

except that under such enhanced voucher assistance -

(A) subject only to subparagraph (D), the assisted family

shall pay as rent no less than the amount the family was paying

on the date of the eligibility event for the project in which

the family was residing on such date;

(B) the assisted family may elect to remain in the same

project in which the family was residing on the date of the

eligibility event for the project, and if, during any period

the family makes such an election and continues to so reside,

the rent for the dwelling unit of the family in such project

exceeds the applicable payment standard established pursuant to

subsection (o) of this section for the unit, the amount of

rental assistance provided on behalf of the family shall be

determined using a payment standard that is equal to the rent

for the dwelling unit (as such rent may be increased from

time-to-time), subject to paragraph (10)(A) of subsection (o)

of this section and any other reasonable limit prescribed by

the Secretary, except that a limit shall not be considered

reasonable for purposes of this subparagraph if it adversely

affects such assisted families;

(C) subparagraph (B) of this paragraph shall not apply and

the payment standard for the dwelling unit occupied by the

family shall be determined in accordance with subsection (o) of

this section if -

(i) the assisted family moves, at any time, from such

project; or

(ii) the voucher is made available for use by any family

other than the original family on behalf of whom the voucher

was provided; and

(D) if the income of the assisted family declines to a

significant extent, the percentage of income paid by the family

for rent shall not exceed the greater of 30 percent or the

percentage of income paid at the time of the eligibility event

for the project.

(2) Eligibility event

For purposes of this subsection, the term "eligibility event"

means, with respect to a multifamily housing project, the

prepayment of the mortgage on such housing project, the voluntary

termination of the insurance contract for the mortgage for such

housing project (including any such mortgage prepayment during

fiscal year 1996 or a fiscal year thereafter or any insurance

contract voluntary termination during fiscal year 1996 or a

fiscal year thereafter), the termination or expiration of the

contract for rental assistance under this section for such

housing project (including any such termination or expiration

during fiscal years after fiscal year 1994 prior to the effective

date of the Departments of Veterans Affairs and Housing and Urban

Development, and Independent Agencies Appropriations Act, 2001),

or the transaction under which the project is preserved as

affordable housing, that, under paragraphs (3) and (4) of section

515(c), section 524(d) of the Multifamily Assisted Housing Reform

and Affordability Act of 1997 (42 U.S.C. 1437f note), section

4113(f) of title 12, or section 1715z-1a(p) of title 12, results

in tenants in such housing project being eligible for enhanced

voucher assistance under this subsection.

(3) Treatment of enhanced vouchers provided under other authority

(A) In general

Notwithstanding any other provision of law, any enhanced

voucher assistance provided under any authority specified in

subparagraph (B) shall (regardless of the date that the amounts

for providing such assistance were made available) be treated,

and subject to the same requirements, as enhanced voucher

assistance under this subsection.

(B) Identification of other authority

The authority specified in this subparagraph is the authority

under -

(i) the 10th, 11th, and 12th provisos under the "Preserving

Existing Housing Investment" account in title II of the

Departments of Veterans Affairs and Housing and Urban

Development, and Independent Agencies Appropriations Act,

1997 (Public Law 104-204; 110 Stat. 2884), pursuant to such

provisos, the first proviso under the "Housing Certificate

Fund" account in title II of the Departments of Veterans

Affairs and Housing and Urban Development, and Independent

Agencies Appropriations Act, 1998 (Public Law 105-65; 111

Stat. 1351), or the first proviso under the "Housing

Certificate Fund" account in title II of the Departments of

Veterans Affairs and Housing and Urban Development, and

Independent Agencies Appropriations Act, 1999 (Public Law

105-276; 112 Stat. 2469); and

(ii) paragraphs (3) and (4) of section 515(c) of the

Multifamily Assisted Housing Reform and Affordability Act of

1997 (42 U.S.C. 1437f note), as in effect before October 20,

1999.

(4) Authorization of appropriations

There are authorized to be appropriated for each of fiscal

years 2000, 2001, 2002, 2003, and 2004 such sums as may be

necessary for enhanced voucher assistance under this subsection.

(u) Assistance for residents of rental rehabilitation projects

In the case of low-income families living in rental projects

rehabilitated under section 1437o (!4) of this title or section

1490m of this title before rehabilitation -

(1) vouchers under this section shall be made for families who

are required to move out of their units because of the physical

rehabilitation activities or because of overcrowding;

(2) at the discretion of each public housing agency or other

agency administering the allocation of assistance or vouchers

under this section may be made for families who would have to pay

more than 30 percent of their adjusted income for rent after

rehabilitation whether they choose to remain in, or to move from,

the project; and

(3) the Secretary shall allocate assistance for vouchers under

this section to ensure that sufficient resources are available to

address the physical or economic displacement, or potential

economic displacement, of existing tenants pursuant to paragraphs

(1) and (2).

(v) Extension of expiring contracts

The Secretary may extend expiring contracts entered into under

this section for project-based loan management assistance to the

extent necessary to prevent displacement of low-income families

receiving such assistance as of September 30, 1996.

(w) Repealed. Pub. L. 106-74, title V, Sec. 531(d)(2), Oct. 20,

1999, 113 Stat. 1116

(x) Family unification

(1) Increase in budget authority

The budget authority available under section 1437c(c) of this

title for assistance under subsection (b) of this section is

authorized to be increased by $100,000,000 on or after October 1,

1992, and by $104,200,000 on or after October 1, 1993.

(2) Use of funds

The amounts made available under this subsection shall be used

only in connection with tenant-based assistance under this

section on behalf of (A) any family (i) who is otherwise eligible

for such assistance, and (ii) who the public child welfare agency

for the jurisdiction has certified is a family for whom the lack

of adequate housing is a primary factor in the imminent placement

of the family's child or children in out-of-home care or the

delayed discharge of a child or children to the family from

out-of-home care and (B) for a period not to exceed 18 months,

otherwise eligible youths who have attained at least 18 years of

age and not more than 21 years of age and who have left foster

care at age 16 or older.

(3) Allocation

The amounts made available under this subsection shall be

allocated by the Secretary through a national competition among

applicants based on demonstrated need for the assistance under

this subsection. To be considered for assistance, an applicant

shall submit to the Secretary a written proposal containing a

report from the public child welfare agency serving the

jurisdiction of the applicant that describes how a lack of

adequate housing in the jurisdiction is resulting in the initial

or prolonged separation of children from their families, and how

the applicant will coordinate with the public child welfare

agency to identify eligible families and provide the families

with assistance under this subsection.

(4) Definitions

For purposes of this subsection:

(A) Applicant

The term "applicant" means a public housing agency or any

other agency responsible for administering assistance under

this section.

(B) Public child welfare agency

The term "public child welfare agency" means the public

agency responsible under applicable State law for determining

that a child is at imminent risk of placement in out-of-home

care or that a child in out-of-home care under the supervision

of the public agency may be returned to his or her family.

(y) Homeownership option

(1) Use of assistance for homeownership

A public housing agency providing tenant-based assistance on

behalf of an eligible family under this section may provide

assistance for an eligible family that purchases a dwelling unit

(including a unit under a lease-purchase agreement) that will be

owned by 1 or more members of the family, and will be occupied by

the family, if the family -

(A) is a first-time homeowner, or owns or is acquiring shares

in a cooperative;

(B) demonstrates that the family has income from employment

or other sources (other than public assistance, except that the

Secretary may provide for the consideration of public

assistance in the case of an elderly family or a disabled

family), as determined in accordance with requirements of the

Secretary, that is not less than twice the payment standard

established by the public housing agency (or such other amount

as may be established by the Secretary);

(C) except as provided by the Secretary, demonstrates at the

time the family initially receives tenant-based assistance

under this subsection that one or more adult members of the

family have achieved employment for the period as the Secretary

shall require;

(D) participates in a homeownership and housing counseling

program provided by the agency; and

(E) meets any other initial or continuing requirements

established by the public housing agency in accordance with

requirements established by the Secretary.

(2) Determination of amount of assistance

(A) Monthly expenses not exceeding payment standard

If the monthly homeownership expenses, as determined in

accordance with requirements established by the Secretary, do

not exceed the payment standard, the monthly assistance payment

shall be the amount by which the homeownership expenses exceed

the highest of the following amounts, rounded to the nearest

dollar:

(i) 30 percent of the monthly adjusted income of the

family.

(ii) 10 percent of the monthly income of the family.

(iii) If the family is receiving payments for welfare

assistance from a public agency, and a portion of those

payments, adjusted in accordance with the actual housing

costs of the family, is specifically designated by that

agency to meet the housing costs of the family, the portion

of those payments that is so designated.

(B) Monthly expenses exceed payment standard

If the monthly homeownership expenses, as determined in

accordance with requirements established by the Secretary,

exceed the payment standard, the monthly assistance payment

shall be the amount by which the applicable payment standard

exceeds the highest of the amounts under clauses (i), (ii), and

(iii) of subparagraph (A).

(3) Inspections and contract conditions

(A) In general

Each contract for the purchase of a unit to be assisted under

this section shall -

(i) provide for pre-purchase inspection of the unit by an

independent professional; and

(ii) require that any cost of necessary repairs be paid by

the seller.

(B) Annual inspections not required

The requirement under subsection (o)(8)(A)(ii) (!5) of this

section for annual inspections shall not apply to units

assisted under this section.

(4) Other authority of the Secretary

The Secretary may -

(A) limit the term of assistance for a family assisted under

this subsection; and

(B) modify the requirements of this subsection as the

Secretary determines to be necessary to make appropriate

adaptations for lease-purchase agreements.

(5) Inapplicability of certain provisions

Assistance under this subsection shall not be subject to the

requirements of the following provisions:

(A) Subsection (c)(3)(B) (!5) of this section.

(B) Subsection (d)(1)(B)(i) of this section.

(C) Any other provisions of this section governing maximum

amounts payable to owners and amounts payable by assisted

families.

(D) Any other provisions of this section concerning contracts

between public housing agencies and owners.

(E) Any other provisions of this chapter that are

inconsistent with the provisions of this subsection.

(6) Reversion to rental status

(A) FHA-insured mortgages

If a family receiving assistance under this subsection for

occupancy of a dwelling defaults under a mortgage for the

dwelling insured by the Secretary under the National Housing

Act [12 U.S.C. 1701 et seq.], the family may not continue to

receive rental assistance under this section unless the family

(i) transfers to the Secretary marketable title to the

dwelling, (ii) moves from the dwelling within the period

established or approved by the Secretary, and (iii) agrees that

any amounts the family is required to pay to reimburse the

escrow account under section 1437u(d)(3) (!5) of this title may

be deducted by the public housing agency from the assistance

payment otherwise payable on behalf of the family.

(B) Other mortgages

If a family receiving assistance under this subsection

defaults under a mortgage not insured under the National

Housing Act [12 U.S.C. 1701 et seq.], the family may not

continue to receive rental assistance under this section unless

it complies with requirements established by the Secretary.

(C) All mortgages

A family receiving assistance under this subsection that

defaults under a mortgage may not receive assistance under this

subsection for occupancy of another dwelling owned by one or

more members of the family.

(7) Downpayment assistance

(A) Authority

A public housing agency may, in lieu of providing monthly

assistance payments under this subsection on behalf of a family

eligible for such assistance and at the discretion of the

public housing agency, provide assistance for the family in the

form of a single grant to be used only as a contribution toward

the downpayment required in connection with the purchase of a

dwelling for fiscal year 2000 and each fiscal year thereafter

to the extent provided in advance in appropriations Acts.

(B) Amount

The amount of a downpayment grant on behalf of an assisted

family may not exceed the amount that is equal to the sum of

the assistance payments that would be made during the first

year of assistance on behalf of the family, based upon the

income of the family at the time the grant is to be made.

(8) "First-time homeowner" defined

For purposes of this subsection, the term "first-time

homeowner" means -

(A) a family, no member of which has had a present ownership

interest in a principal residence during the 3 years preceding

the date on which the family initially receives assistance for

homeownership under this subsection; and

(B) any other family, as the Secretary may prescribe.

(z) Termination of section 1437f contracts and reuse of recaptured

budget authority

(1) General authority

The Secretary may reuse any budget authority, in whole or part,

that is recaptured on account of expiration or termination of a

housing assistance payments contract only for one or more of the

following:

(A) Tenant-based assistance

Pursuant to a contract with a public housing agency, to

provide tenant-based assistance under this section to families

occupying units formerly assisted under the terminated

contract.

(B) Project-based assistance

Pursuant to a contract with an owner, to attach assistance to

one or more structures under this section, for relocation of

families occupying units formerly assisted under the terminated

contract.

(2) Families occupying units formerly assisted under terminated

contract

Pursuant to paragraph (1), the Secretary shall first make

available tenant- or project-based assistance to families

occupying units formerly assisted under the terminated contract.

The Secretary shall provide project-based assistance in instances

only where the use of tenant-based assistance is determined to be

infeasible by the Secretary.

(aa) Omitted

(bb) Transfer, reuse, and rescission of budget authority

(1) Transfer of budget authority

If an assistance contract under this section, other than a

contract for tenant-based assistance, is terminated or is not

renewed, or if the contract expires, the Secretary shall, in

order to provide continued assistance to eligible families,

including eligible families receiving the benefit of the

project-based assistance at the time of the termination, transfer

any budget authority remaining in the contract to another

contract. The transfer shall be under such terms as the Secretary

may prescribe.

(2) Reuse and rescission of certain recaptured budget authority

Notwithstanding paragraph (1), if a project-based assistance

contract for an eligible multifamily housing project subject to

actions authorized under this subchapter is terminated or amended

as part of restructuring under section 517 of the Multifamily

Assisted Housing Reform and Affordability Act of 1997, the

Secretary shall recapture the budget authority not required for

the terminated or amended contract and use such amounts as are

necessary to provide housing assistance for the same number of

families covered by such contract for the remaining term of such

contract, under a contract providing for project-based or

tenant-based assistance. The amount of budget authority saved as

a result of the shift to project-based or tenant-based assistance

shall be rescinded.

(cc) Law enforcement and security personnel

(1) In general

Notwithstanding any other provision of this chapter, in the

case of assistance attached to a structure, for the purpose of

increasing security for the residents of a project, an owner may

admit, and assistance under this section may be provided to,

police officers and other security personnel who are not

otherwise eligible for assistance under the chapter.

(2) Rent requirements

With respect to any assistance provided by an owner under this

subsection, the Secretary may -

(A) permit the owner to establish such rent requirements and

other terms and conditions of occupancy that the Secretary

considers to be appropriate; and

(B) require the owner to submit an application for those rent

requirements, which application shall include such information

as the Secretary, in the discretion of the Secretary,

determines to be necessary.

(3) Applicability

This subsection shall apply to fiscal year 1999 and fiscal

years thereafter.

(dd) Tenant-based contract renewals

Subject to amounts provided in appropriation Acts, starting in

fiscal year 1999, the Secretary shall renew all expiring

tenant-based annual contribution contracts under this section by

applying an inflation factor based on local or regional factors to

an allocation baseline. The allocation baseline shall be calculated

by including, at a minimum, amounts sufficient to ensure continued

assistance for the actual number of families assisted as of October

1, 1997, with appropriate upward adjustments for incremental

assistance and additional families authorized subsequent to that

date.

-SOURCE-

(Sept. 1, 1937, ch. 896, title I, Sec. 8, as added Pub. L. 93-383,

title II, Sec. 201(a), Aug. 22, 1974, 88 Stat. 662; amended Pub. L.

94-375, Sec. 2(d), (e), (g), Aug. 3, 1976, 90 Stat. 1068; Pub. L.

95-24, title I, Sec. 101(c), Apr. 30, 1977, 91 Stat. 55; Pub. L.

95-128, title II, Sec. 201(c)-(e), Oct. 12, 1977, 91 Stat. 1128;

Pub. L. 95-557, title II, Sec. 206(d)(1), (e), (f), Oct. 31, 1978,

92 Stat. 2091, 2092; Pub. L. 96-153, title II, Secs. 202(b),

206(b), 210, 211(b), Dec. 21, 1979, 93 Stat. 1106, 1108-1110; Pub.

L. 96-399, title II, Sec. 203, title III, Sec. 308(c)(3), Oct. 8,

1980, 94 Stat. 1629, 1641; Pub. L. 97-35, title III, Secs. 322(e),

324-326(a), (e)(1), 329H(a), Aug. 13, 1981, 95 Stat. 402, 405-407,

410; Pub. L. 98-181, title II, Secs. 203(b)(1), (2), 207-209(a),

210, 211, Nov. 30, 1983, 97 Stat. 1178, 1181-1183; Pub. L. 98-479,

title I, Sec. 102(b)(6)-(10), Oct. 17, 1984, 98 Stat. 2221, 2222;

Pub. L. 100-242, title I, Secs. 141-149, title II, Sec. 262, Feb.

5, 1988, 101 Stat. 1849-1853, 1890; renumbered title I, Pub. L.

100-358, Sec. 5, June 29, 1988, 102 Stat. 681; Pub. L. 100-628,

title X, Secs. 1004(a), 1005(b)(1), (c), 1006, 1014(b), (c), 1029,

Nov. 7, 1988, 102 Stat. 3264, 3265, 3269, 3272; Pub. L. 101-235,

title I, Sec. 127, title VIII, Sec. 801(c), (g), Dec. 15, 1989, 103

Stat. 2025, 2058, 2059; Pub. L. 101-625, title II, Sec. 289(b),

title IV, Sec. 413, title V, Secs. 541-545(a), 545(2)[(b)],

546-549, 550(a), (c), 551-553, 572, title VI, Secs. 603, 613(a),

Nov. 28, 1990, 104 Stat. 4128, 4160, 4216-4224, 4236, 4277, 4280;

Pub. L. 102-139, title II, Oct. 28, 1991, 105 Stat. 756; Pub. L.

102-550, title I, Secs. 141-148, 185(a), title VI, Secs. 623(b),

660, 674, 675, 682(b), title X, Sec. 1012(g), Oct. 28, 1992, 106

Stat. 3713-3715, 3745, 3819, 3825, 3827, 3828, 3830, 3905; Pub. L.

103-233, title I, Sec. 101(c)(2), (3), (d), Apr. 11, 1994, 108

Stat. 357; Pub. L. 103-327, title II, Sept. 28, 1994, 108 Stat.

2315; Pub. L. 104-19, title I, Sec. 1003, July 27, 1995, 109 Stat.

236; Pub. L. 104-99, title IV, Secs. 402(d)(2), (3), (6)(A)(iii),

(iv), 405(c), Jan. 26, 1996, 110 Stat. 41, 42, 44; Pub. L. 104-134,

title I, Sec. 101(e) [title II, Secs. 203(a)-(c), 208], Apr. 26,

1996, 110 Stat. 1321-257, 1321-281, 1321-284; renumbered title I,

Pub. L. 104-140, Sec. 1(a), May 2, 1996, 110 Stat. 1327; Pub. L.

104-193, title IX, Sec. 903(a)(2), Aug. 22, 1996, 110 Stat. 2348;

Pub. L. 104-204, title II, Sec. 201(g), Sept. 26, 1996, 110 Stat.

2893; Pub. L. 105-18, title II, Sec. 10002, June 12, 1997, 111

Stat. 201; Pub. L. 105-33, title II, Secs. 2003, 2004, Aug. 5,

1997, 111 Stat. 257; Pub. L. 105-65, title II, Secs. 201(c), 205,

title V, Sec. 523(a), (c), Oct. 27, 1997, 111 Stat. 1364, 1365,

1406, 1407; Pub. L. 105-276, title II, Sec. 209(a), title V, Secs.

514(b)(1), 545(a), (b), 547-549(a)(2), (b), 550(a), 552-555(a),

556(a), 565(c), Oct. 21, 1998, 112 Stat. 2485, 2547, 2596-2607,

2609-2611, 2613, 2631; Pub. L. 106-74, title II, Sec. 223, title V,

Secs. 523(a), 531(d), 535, 538(a), Oct. 20, 1999, 113 Stat. 1076,

1104, 1116, 1121, 1122; Pub. L. 106-246, div. B, title II, Sec.

2801, July 13, 2000, 114 Stat. 569; Pub. L. 106-377, Sec. 1(a)(1)

[title II, Secs. 205, 228, 232(a), 234], Oct. 27, 2000, 114 Stat.

1441, 1441A-24, 1441A-30, 1441A-31, 1441A-35; Pub. L. 106-569,

title III, Sec. 301(a), title IX, Secs. 902(a), 903(a), Dec. 27,

2000, 114 Stat. 2952, 3026; Pub. L. 107-95, Sec. 12, Dec. 21, 2001,

115 Stat. 921; Pub. L. 107-116, title VI, Sec. 632, Jan. 10, 2002,

115 Stat. 2227.)

-REFTEXT-

REFERENCES IN TEXT

The Cranston-Gonzalez National Affordable Housing Act, referred

to in subsecs. (f)(4) and (o)(4)(D), is Pub. L. 101-625, Nov. 28,

1990, 104 Stat. 4079. Title II of the Act, also known as the "HOME

Investment Partnerships Act", is classified principally to

subchapter II (Sec. 12721 et seq.) of chapter 130 of this title.

Title IV of the Act, also known as the "Homeownership and

Opportunity Through HOPE Act", enacted subchapter II-A (Sec.

1437aaa et seq.) of this chapter and subchapter IV (Sec. 12871 et

seq.) of chapter 130 of this title, amended sections 1437c, 1437f,

1437l, 1437p, 1437r, and 1437s of this title and section 1709 of

Title 12, Banks and Banking, and enacted provisions set out as

notes under sections 1437c, 1437aa, and 1437aaa of this title. For

complete classification of this Act to the Code, see Short Title

note set out under section 12701 of this title and Tables.

The Housing and Community Development Act of 1992, referred to in

subsec. (d)(2)(C), (D), is Pub. L. 102-550, Oct. 28, 1992, 106

Stat. 3672. Subtitle C of title VI of the Act is classified

generally to subchapter I (Sec. 13601 et seq.) of chapter 135 of

this title. Subtitle D of title VI of the Act is classified

principally to subchapter II (Sec. 13611 et seq.) of chapter 135 of

this title. For complete classification of this Act to the Code,

see Short Title of 1992 Amendment note set out under section 5301

of this title and Tables.

Sections 514 and 517 of the Multifamily Assisted Housing Reform

and Affordability Act of 1997, referred to in subsecs. (d)(5) and

(bb)(2), are sections 514 and 517 of Pub. L. 105-65, and are set

out as a note under this section.

The Social Security Act, referred to in subsec. (k), is act Aug.

14, 1935, ch. 531, 49 Stat. 620, as amended, which is classified

generally to chapter 7 (Sec. 301 et seq.) of this title. For

complete classification of this Act to the Code, see section 1305

of this title and Tables.

The Food Stamp Act of 1977, referred to in subsec. (k), is Pub.

L. 88-525, Aug. 31, 1964, 78 Stat. 703, as amended, which is

classified generally to chapter 51 (Sec. 2011 et seq.) of Title 7,

Agriculture. For complete classification of this Act to the Code,

see Short Title note set out under 2011 of Title 7 and Tables.

The Fair Housing Act, referred to in subsec. (o)(17), is title

VIII of Pub. L. 90-284, Apr. 11, 1968, 82 Stat. 81, as amended,

which is classified principally to subchapter I (Sec. 3601 et seq.)

of chapter 45 of this title. For complete classification of this

Act to the Code, see Short Title note set out under section 3601 of

this title and Tables.

Section 503(a) of the Quality Housing and Work Responsibility Act

of 1998, referred to in subsec. (q)(1)(B)(ii)(I), (2)(A), is

section 503(a) of Pub. L. 105-276, which is set out as an Effective

Date of 1998 Amendment note under section 1437 of this title.

The effective date of the Departments of Veterans Affairs and

Housing and Urban Development, and Independent Agencies

Appropriations Act, 2001, referred to in subsec. (t)(2), means the

effective date of H.R. 5482, as enacted by section 1(a)(1) of Pub.

L. 106-377, which was approved Oct. 27, 2000.

Section 1437o of this title, referred to in subsec. (u), was

repealed by Pub. L. 101-625, title II, Sec. 289(b), Nov. 28, 1990,

104 Stat. 4128.

Subsection (o)(8)(A) of this section, referred to in subsec.

(y)(3)(B), does not contain a cl. (ii) and does not relate to

annual inspections. For provisions of subsec. (o)(8) which relate

to annual inspections, see subpar. (D).

Subsection (c)(3)(B) of this section, referred to in subsec.

(y)(5), was repealed by Pub. L. 105-276, title V, Sec.

550(a)(3)(A)(ii), Oct. 21, 1998, 112 Stat. 2609.

The National Housing Act, referred to in subsec. (y)(6), is act

June 27, 1934, ch. 847, 48 Stat. 1246, as amended, which is

classified principally to chapter 13 (Sec. 1701 et seq.) of Title

12, Banks and Banking. For complete classification of this Act to

the Code, see section 1701 of Title 12 and Tables.

Section 1437u(d)(3) of this title, relating to reimbursement of

escrow accounts, referred to in subsec. (y)(6)(A), was repealed by

Pub. L. 105-276, title V, Sec. 509(a)(2), Oct. 21, 1998, 112 Stat.

2531.

-COD-

CODIFICATION

October 20, 1999, referred to in subsec. (t)(3)(B)(ii), was in

the original "the enactment of this Act", which was translated as

meaning the enactment of Pub. L. 106-74, which enacted subsec. (t)

of this section, to reflect the probable intent of Congress.

Section 203(a) of Pub. L. 100-242, as amended, which was formerly

set out in a note under section 1715l of Title 12, Banks and

Banking, and which provided that on Nov. 28, 1990, the amendment

made by section 262 of Pub. L. 100-242 is repealed and section is

to read as it would without such amendment, was omitted in the

general amendment of subtitle A of title II of Pub. L. 100-242 by

Pub. L. 101-625.

-MISC1-

PRIOR PROVISIONS

A prior section 8 of act Sept. 1, 1937, ch. 896, 50 Stat. 891, as

amended, authorized promulgation of rules and regulations by the

Authority and was classified to section 1408 of this title, prior

to the general revision of this chapter by Pub. L. 93-383.

AMENDMENTS

2002 - Subsec. (t)(2). Pub. L. 107-116 inserted "(including any

such mortgage prepayment during fiscal year 1996 or a fiscal year

thereafter or any insurance contract voluntary termination during

fiscal year 1996 or a fiscal year thereafter)" after "insurance

contract for the mortgage for such housing project".

2001 - Subsec. (o)(19). Pub. L. 107-95 added par. (19).

2000 - Subsec. (o)(13). Pub. L. 106-377, Sec. 1(a)(1) [title II,

Sec. 232(a)], reenacted heading without change and amended text

generally, substituting subpars. (A) to (K) providing for funding

percentage limitation, consistency of contracts with public housing

agency plan and goals, income mixing requirement, resident choice

requirement, contract term and its extension, rent calculation and

adjustments, tenant selection, and vacated units for former

subpars. (A) to (D) providing for extension of contract term, rent

calculation, and adjusted rents.

Subsec. (t)(1)(B). Pub. L. 106-569, Sec. 903(a), inserted before

semicolon at end ", except that a limit shall not be considered

reasonable for purposes of this subparagraph if it adversely

affects such assisted families".

Pub. L. 106-377, Sec. 1(a)(1) [title II, Sec. 205], inserted "and

any other reasonable limit prescribed by the Secretary" before

semicolon at end.

Pub. L. 106-246, which directed the substitution of "the assisted

family may elect to remain in the same project in which the family

was residing on the date of the eligibility event for the project,

and if, during any period the family makes such an election and

continues to so reside," for "during any period that the assisted

family continues residing in the same project in which the family

was residing on the date of the eligibility event for the project,

if" in section 538 of Pub. L. 106-74, was executed by making the

substitution in subsec. (t)(1)(B) of this section, which was

enacted by section 538 of Pub. L. 106-74, to reflect the probable

intent of Congress.

Subsec. (t)(2). Pub. L. 106-569, Sec. 902(a), substituted "fiscal

year 1994" for "fiscal year 1996".

Pub. L. 106-377, Sec. 1(a)(1) [title II, Sec. 228], inserted

"(including any such termination or expiration during fiscal years

after fiscal year 1996 prior to the effective date of the

Departments of Veterans Affairs and Housing and Urban Development,

and Independent Agencies Appropriations Act, 2001)" after "contract

for rental assistance under this section for such housing project".

Subsec. (x)(2). Pub. L. 106-377, Sec. 1(a)(1) [title II, Sec.

234], substituted "(A) any family (i) who is otherwise eligible for

such assistance, and (ii)" for "any family (A) who is otherwise

eligible for such assistance, and (B)" and inserted before period

at end "and (B) for a period not to exceed 18 months, otherwise

eligible youths who have attained at least 18 years of age and not

more than 21 years of age and who have left foster care at age 16

or older".

Subsec. (y)(7), (8). Pub. L. 106-569, Sec. 301(a), added par. (7)

and redesignated former par. (7) as (8).

1999 - Subsec. (c)(8)(A). Pub. L. 106-74, Sec. 535(1),

substituted "termination of" for "terminating" after "Not less than

one year before" and ". The notice shall also include a statement

that, if the Congress makes funds available, the owner and the

Secretary may agree to a renewal of the contract, thus avoiding

termination, and that in the event of termination the Department of

Housing and Urban Development will provide tenant-based rental

assistance to all eligible residents, enabling them to choose the

place they wish to rent, which is likely to include the dwelling

unit in which they currently reside. Any contract covered by this

paragraph that is renewed may be renewed for a period of up to 1

year or any number or years, with payments subject to the

availability of appropriations for any year." for ", specifying the

reasons for the termination with sufficient detail to enable the

Secretary to evaluate whether the termination is lawful and whether

there are additional actions that can be taken by the Secretary to

avoid the termination. The owner's notice shall include a statement

that the owner and the Secretary may agree to a renewal of the

contract, thus avoiding the termination."

Subsec. (c)(8)(B). Pub. L. 106-74, Sec. 535(2), (4), redesignated

subpar. (C) as (B) and struck out former subpar. (B) which read as

follows: "In the case of owner who has requested that the Secretary

renew the contract, the owner's notice under subparagraph (A) to

the tenants shall include statements that -

"(i) the owner currently has a contract with the Department of

Housing and Urban Development that pays the Government's share of

the tenant's rent and the date on which the contract will expire;

"(ii) the owner intends to renew the contract for another year;

"(iii) renewal of the contract may depend upon the Congress

making funds available for such renewal;

"(iv) the owner is required by law to notify tenants of the

possibility that the contract may not be renewed if Congress does

not provide funding for such renewals;

"(v) in the event of nonrenewal, the Department of Housing and

Urban Development will provide tenant-based rental assistance to

all eligible residents, enabling them to choose the place they

wish to rent; and

"(vi) the notice itself does not indicate an intent to

terminate the contract by either the owner or the Department of

Housing and Urban Development, provided there is Congressional

approval of funding availability."

Subsec. (c)(8)(C). Pub. L. 106-74, Sec. 535(4), redesignated

subpar. (D) as (C). Former subpar. (C) redesignated (B).

Pub. L. 106-74, Sec. 535(3), struck out "Notwithstanding the

preceding provisions of this paragraph, if the owner agrees to a

5-year contract renewal offered by the Secretary, payments under

which shall be subject to the availability of appropriations for

any year, the owner shall provide a written notice to the Secretary

and the tenants not less than 180 days before the termination of

such contract." after "(C)" and "in the immediately preceding

sentence" before ", the owner may not evict the tenants", struck

out "180-day" before "notice" in two places, and substituted "1

year has elapsed" for "such period has elapsed" and "1 year of

advance notice" for "180 days of advance notice".

Subsec. (c)(8)(D), (E). Pub. L. 106-74, Sec. 535(4), redesignated

subpars. (D) and (E) as (C) and (D), respectively.

Subsec. (o)(18). Pub. L. 106-74, Sec. 523(a), added par. (18).

Subsec. (t). Pub. L. 106-74, Sec. 538(a), added subsec. (t).

Subsec. (v). Pub. L. 106-74, Sec. 531(d)(1), designated sentence

enacted by Pub. L. 104-99, Sec. 405(c), as subsec. (v).

Subsec. (w). Pub. L. 106-74, Sec. 531(d)(2), struck out heading

and text of subsec. (w). Text read as follows: "Not later than 30

days after the beginning of each fiscal year, the Secretary shall

publish in the Federal Register a plan for reducing, to the extent

feasible, year-to-year fluctuations in the levels of budget

authority that will be required over the succeeding 5-year period

to renew expiring rental assistance contracts entered into under

this section since August 22, 1974. To the extent necessary to

carry out such plan and to the extent approved in appropriations

Acts, the Secretary is authorized to enter into annual

contributions contracts with terms of less than 60 months."

Subsec. (z)(1). Pub. L. 106-74, Sec. 223(1), in introductory

provisions, inserted "expiration or" after "on account of" and

struck out "(other than a contract for tenant-based assistance)"

after "payments contract".

Subsec. (z)(3). Pub. L. 106-74, Sec. 223(2), struck out heading

and text of par. (3). Text read as follows: "This subsection shall

be effective for actions initiated by the Secretary on or before

September 30, 1995."

1998 - Subsec. (a). Pub. L. 105-276, Sec. 550(a)(1), struck out

at end "A public housing agency may contract to make assistance

payments to itself (or any agency or instrumentality thereof) as

the owner of dwelling units if such agency is subject to the same

program requirements as are applied to other owners. In such cases,

the Secretary may establish initial rents within applicable

limits."

Subsec. (b). Pub. L. 105-276, Sec. 550(a)(2), substituted "Other"

for "Rental certificates and other" in subsec. heading, inserted

par. (1) designation and heading, and struck out after first

sentence "The Secretary shall enter into a separate annual

contributions contract with each public housing agency to obligate

the authority approved each year, beginning with the authority

approved in appropriations Acts for fiscal year 1988 (other than

amendment authority to increase assistance payments being made

using authority approved prior to the appropriations Acts for

fiscal year 1988), and such annual contributions contract (other

than for annual contributions under subsection (o) of this section)

shall bind the Secretary to make such authority, and any amendments

increasing such authority, available to the public housing agency

for a specified period."

Subsec. (c)(3). Pub. L. 105-276, Sec. 550(a)(3)(A), struck out

"(A)" after par. designation, and struck out subpar. (B), which

authorized payment of higher percentage of income as rent than that

specified under section 1437a(a) of this title if family receiving

tenant-based rental assistance notified public housing agency of

its interest in a unit renting for an excess rent and agency

determined that the rent was reasonable, and set forth provisions

which limited agency approval of such excess rentals to 10 percent

of annual allocation, required report to Secretary where such

rentals exceeded 5 percent of allocation, and required Secretary to

report to Congress annually on agencies which had submitted such

reports and include recommendations deemed appropriate to correct

problems identified in reports.

Subsec. (c)(4). Pub. L. 105-276, Sec. 550(a)(3)(B), struck out

"or by a family that qualifies to receive assistance under

subsection (b) of this section pursuant to section 223 or 226 of

the Low-Income Housing Preservation and Resident Homeownership Act

of 1990" after "such dwelling unit" in first sentence.

Subsec. (c)(5), (6). Pub. L. 105-276, Sec. 550(a)(3)(C), (D),

redesignated par. (6) as (5) and struck out former par. (5) which

read as follows: "Assistance payments may be made with respect to

up to 100 per centum of the dwelling units in any structure upon

the application of the owner or prospective owner. Within the

category of projects containing more than fifty units and designed

for use primarily by nonelderly and nonhandicapped persons which

are not subject to mortgages purchased under section 305 of the

National Housing Act, the Secretary may give preference to

applications for assistance involving not more than 20 per centum

of the dwelling units in a project. In according any such

preference, the Secretary shall compare applications received

during distinct time periods not exceeding sixty days in duration."

Subsec. (c)(7). Pub. L. 105-276, Sec. 550(a)(3)(C), struck out

par. (7) which read as follows: "To the extent authorized in

contracts entered into by the Secretary with a public housing

agency, such agency may purchase any structure containing one or

more dwelling units assisted under this section for the purpose of

reselling the structure to the tenant or tenants occupying units

aggregating in value at least 80 per centum of the structure's

total value. Any such resale may be made on the terms and

conditions prescribed under section 1437c(h) of this title and

subject to the limitation contained in such section."

Subsec. (c)(8). Pub. L. 105-276, Sec. 549(b), redesignated par.

(9) as (8)(A) and substituted subpars. (B) to (E) for "The

Secretary shall review the owner's notice, shall consider whether

there are additional actions that can be taken by the Secretary to

avoid the termination, and shall ensure a proper adjustment of the

contract rents for the project in conformity with the requirements

of paragraph (2). The Secretary shall issue a written finding of

the legality of the termination and the reasons for the

termination, including the actions considered or taken to avoid the

termination. Within 30 days of the Secretary's finding, the owner

shall provide written notice to each tenant of the Secretary's

decision. For purposes of this paragraph, the term 'termination'

means the expiration of the assistance contract or an owner's

refusal to renew the assistance contract, and such term shall

include termination of the contract for business reasons."

Pub. L. 105-276, Sec. 549(a)(1)(A), struck out par. (8) which

read as follows: "Each contract under this section shall provide

that the owner will notify tenants at least 90 days prior to the

expiration of the contract of any rent increase which may occur as

a result of the expiration of such contract."

Subsec. (c)(9). Pub. L. 105-276, Sec. 549(b)(1), redesignated

par. (9) as (8)(A).

Pub. L. 105-276, Sec. 549(a)(1)(B), substituted "Not less than

one year before terminating any contract under which assistance

payments are received under this section, other than a contract for

tenant-based assistance under this section, an owner shall provide

written notice to the Secretary and the tenants involved of the

proposed termination, specifying the reasons for the termination

with sufficient detail to enable the Secretary to evaluate whether

the termination is lawful and whether there are additional actions

that can be taken by the Secretary to avoid the termination." for

"Not less than 180 days prior to terminating any contract under

which assistance payments are received under this section (but not

less than 90 days in the case of housing certificates or vouchers

under subsection (b) or (o) of this section), an owner shall

provide written notice to the Secretary and the tenants involved of

the proposed termination, specifying the reasons for the

termination with sufficient detail to enable the Secretary to

evaluate whether the termination is lawful and whether there are

additional actions that can be taken by the Secretary to avoid the

termination."

Subsec. (c)(10). Pub. L. 105-276, Sec. 549(a)(1)(A), struck out

par. (10) which read as follows: "If an owner provides notice of

proposed termination under paragraph (9) and the contract rent is

lower than the maximum monthly rent for units assisted under

subsection (b)(1) of this section, the Secretary shall adjust the

contract rent based on the maximum monthly rent for units assisted

under subsection (b)(1) of this section and the value of the

low-income housing after rehabilitation."

Subsec. (d)(1)(A). Pub. L. 105-276, Sec. 514(b)(1), amended

subpar. (A) generally. For former text of subpar. (A), see 1996

Amendment note below.

Subsec. (d)(1)(B)(ii). Pub. L. 105-276, Sec. 549(a)(2)(A),

substituted "during the term of the lease, the owner" for "the

owner".

Subsec. (d)(1)(B)(iii). Pub. L. 105-276, Sec. 549(a)(2)(B),

substituted "during the term of the lease, any criminal activity"

for "provide that any criminal activity".

Subsec. (d)(2)(A). Pub. L. 105-276, Sec. 550(a)(4)(A), struck out

at end "Where the Secretary enters into an annual contributions

contract with a public housing agency pursuant to which the agency

will enter into a contract for assistance payments with respect to

an existing structure, the contract for assistance payments may not

be attached to the structure unless (i) the Secretary and the

public housing agency approve such action, and (ii) the owner

agrees to rehabilitate the structure other than with assistance

under this chapter and otherwise complies with the requirements of

this section, except that the Secretary shall permit the public

housing agency to approve such attachment with respect to not more

than 15 percent of the assistance provided by the public housing

agency if the requirements of clause (ii) are met. Notwithstanding

any other provision of this section, a public housing agency and an

applicable State agency may, on a priority basis, attach to

structures not more than an additional 15 percent of the assistance

provided by the public housing agency or the applicable State

agency only with respect to projects assisted under a State program

that permits the owner of the projects to prepay a State assisted

or subsidized mortgage on the structure, except that attachment of

assistance under this sentence shall be for the purpose of (i)

providing incentives to owners to preserve such projects for

occupancy by lower and moderate income families (for the period

that assistance under this sentence is available), and (ii) to

assist lower income tenants to afford any increases in rent that

may be required to induce the owner to maintain occupancy in the

project by lower and moderate income tenants. Any assistance

provided to lower income tenants under the preceding sentence shall

not be considered for purposes of the limitation under paragraph

(1)(A) regarding the percentage of families that may receive

assistance under this section who do not qualify for preferences

under such paragraph."

Subsec. (d)(2)(B) to (G). Pub. L. 105-276, Sec. 550(a)(4)(C),

redesignated subpars. (F) to (H) as (B) to (D), respectively, and

struck out former subpars. (B) to (E). Prior to repeal, former

subpar. (B) required the Secretary to permit a public housing

agency to approve attachment of assistance with respect to any

newly constructed structure if certain conditions were met, former

subpar. (C) required a public housing agency to enter into a

contract with an owner of a structure to which a contract for

assistance was attached under this par. to provide for renewal of

expiring assistance payment contracts, former subpar. (D) required

owners of structures to which a contract for assistance was

attached to adopt certain tenant selection procedures, and former

subpar. (E) required the Secretary to annually survey public

housing agencies to determine which have reached certain

limitations in providing assistance and to report the survey

results to Congress.

Subsec. (d)(2)(H). Pub. L. 105-276, Sec. 550(a)(4)(C),

redesignated subpar. (H) as (D).

Pub. L. 105-276, Sec. 550(a)(4)(B), substituted "An owner" for

"Notwithstanding subsection (d)(1)(A)(i) of this section, an

owner".

Subsec. (d)(6). Pub. L. 105-276, Sec. 552, added par. (6).

Subsec. (f)(6). Pub. L. 105-276, Sec. 545(b), inserted "or

(o)(13)" after "(d)(2)".

Subsec. (f)(7). Pub. L. 105-276, Sec. 550(a)(5), struck out "(b)

or" after "under subsection" and inserted before period at end "and

that provides for the eligible family to select suitable housing

and to move to other suitable housing".

Subsec. (h). Pub. L. 105-276, Sec. 565(c), which directed

insertion of "(except as provided in section 1437d(j)(3) of this

title)" after "section 1437d of this title", was executed by making

the insertion after "Sections 1437c(e) and 1437d of this title", to

reflect the probable intent of Congress.

Subsec. (j). Pub. L. 105-276, Sec. 550(a)(6), struck out subsec.

(j), which authorized contracts for making rental assistance

payments on behalf of low-income families utilizing manufactured

homes as principal places of residence, directed that contract

establish maximum monthly rent permitted with respect to home and

real property on which it was located and provided formula for

calculating amount of monthly assistance, provided for adjustments,

set forth minimum and maximum terms, in the case of substantially

rehabilitated or newly constructed park, provided limit on

principal amount of mortgage attributable to rental spaces within

park, and authorized Secretary to prescribe other terms and

conditions necessary for purpose of carrying out subsection.

Subsec. (n). Pub. L. 105-276, Sec. 550(a)(7), struck out subsec.

(n) which read as follows: "In making assistance available under

subsections (b)(1) and (e)(2) of this section, the Secretary may

provide assistance with respect to residential properties in which

some or all of the dwelling units do not contain bathroom or

kitchen facilities, if -

"(1) the property is located in an area in which there is a

significant demand for such units, as determined by the

Secretary;

"(2) the unit of general local government in which the property

is located and the local public housing agency approve of such

units being utilized for such purpose; and

"(3) in the case of assistance under subsection (b)(1) of this

section, the unit of general local government in which the

property is located and the local public housing agency certify

to the Secretary that the property complies with local health and

safety standards.

The Secretary may waive, in appropriate cases, the limitation and

preference described in the second and third sentences of section

1437a(b)(3) of this title with respect to the assistance made

available under this subsection."

Subsec. (o). Pub. L. 105-276, Sec. 545(a), amended subsec. (o)

generally. Prior to amendment, subsec. (o) contained provisions

relating to assistance using a payment standard based upon fair

market rental, categories of families eligible for assistance and

preferences, contracts with public housing agencies for annual

contributions, annual adjustments of assistance payment amounts,

assistance with respect to certain cooperative and mutual housing,

contracts to provide rental vouchers, set asides of budget

authority for an adjustment pool, reasonable rent requirements and

disapproval of leases with unreasonable rents, and assistance on

behalf of families utilizing manufactured homes as principal places

of residence.

Subsec. (o)(2). Pub. L. 105-276, Sec. 209(a), inserted at end

"Notwithstanding the preceding sentence, for families being

admitted to the voucher program who remain in the same unit or

complex, where the rent (including the amount allowed for

utilities) does not exceed the payment standard, the monthly

assistance payment for any family shall be the amount by which such

rent exceeds the greater of 30 percent of the family's monthly

adjusted income or 10 percent of the family's monthly income."

Notwithstanding sections 209(b) and 503 of Pub. L. 105-276, set out

as Effective Date of 1998 Amendment notes below and under section

1437 of this title, this amendment was executed before the

amendment by section 545(a) of Pub. L. 105-276 to reflect the

probable intent of Congress and the provisions of section 545(c) of

Pub. L. 105-276, set out as an Effective Date of 1998 Amendment

note below, and section 559 of Pub. L. 105-276, set out as a

Regulations note below.

Subsec. (q). Pub. L. 105-276, Sec. 547, amended subsec. (q)

generally, substituting present provisions for provisions which

authorized establishment of fee for costs incurred in administering

certificate and housing voucher programs under subsecs. (b) and (o)

of this section, costs of preliminary expenses in connection with

new allocations of assistance, costs incurred in assisting families

who experienced difficulty in obtaining appropriate housing under

the programs, and extraordinary costs; provisions which set forth

use of fees for employing one or more service coordinators to

coordinate provision of supportive services for elderly or disabled

families on whose behalf assistance was provided; and provision

which limited establishment or increase of fees to amounts provided

in appropriation Acts.

Subsec. (r). Pub. L. 105-276, Sec. 553(3), inserted heading,

added par. (1), and struck out former par. (1) which read as

follows: "Any family assisted under subsection (b) or (o) of this

section may receive such assistance to rent an eligible dwelling

unit if the dwelling unit to which the family moves is within the

same State, or the same or a contiguous metropolitan statistical

area as the metropolitan statistical area within which is located

the area of jurisdiction of the public housing agency approving

such assistance; except that any family not living within the

jurisdiction of a public housing agency at the time that such

family applies for assistance from such agency shall, during the

12-month period beginning upon the receipt of any tenant-based

rental assistance made available on behalf of the family, use such

assistance to rent an eligible dwelling unit located within the

jurisdiction served by such public housing agency."

Subsec. (r)(2). Pub. L. 105-276, Sec. 553(1), struck out at end

"If no public housing agency has authority with respect to the

dwelling unit to which a family moves under this subsection, the

public housing agency approving the assistance shall have such

responsibility."

Subsec. (r)(3). Pub. L. 105-276, Sec. 553(2), struck out "(b) or"

before "(o) of this section for" and inserted at end "The Secretary

shall establish procedures for the compensation of public housing

agencies that issue vouchers to families that move into or out of

the jurisdiction of the public housing agency under portability

procedures. The Secretary may reserve amounts available for

assistance under subsection (o) of this section to compensate those

public housing agencies."

Subsec. (r)(5). Pub. L. 105-276, Sec. 553(5), added par. (5).

Subsec. (t). Pub. L. 105-276, Sec. 554, struck out subsec. (t).

For text, see 1996 Amendment note below.

Subsec. (u). Pub. L. 105-276, Sec. 550(a)(8), in pars. (1) and

(3), struck out "certificates or" before "vouchers" and, in par.

(2), struck out ", certificates" before "or vouchers".

Subsec. (x)(2). Pub. L. 105-276, Sec. 550(a)(9), substituted

"tenant-based assistance" for "housing certificate assistance".

Subsec. (y)(1). Pub. L. 105-276, Sec. 555(a)(1)(A), in

introductory provisions, substituted "A public housing agency

providing tenant-based assistance on behalf of an eligible family

under this section may provide assistance for an eligible family

that purchases a dwelling unit (including a unit under a

lease-purchase agreement) that will be owned by 1 or more members

of the family, and will be occupied by the family, if the family"

for "A family receiving tenant-based assistance under this section

may receive assistance for occupancy of a dwelling owned by one or

more members of the family if the family".

Subsec. (y)(1)(A). Pub. L. 105-276, Sec. 555(a)(1)(B), inserted

", or owns or is acquiring shares in a cooperative" before

semicolon at end.

Subsec. (y)(1)(B). Pub. L. 105-276, Sec. 555(a)(1)(C), struck out

cl. (i), redesignated cl. (ii) as entire subpar., and inserted ",

except that the Secretary may provide for the consideration of

public assistance in the case of an elderly family or a disabled

family" after "public assistance". Prior to amendment, cl. (i) read

as follows: "participates in the family self-sufficiency program

under section 1437u of this title of the public housing agency

providing the assistance; or".

Subsec. (y)(2). Pub. L. 105-276, Sec. 555(a)(2), added par. (2)

and struck out heading and text of former par. (2). Text read as

follows:

"(A) In general. - Notwithstanding any other provisions of this

section governing determination of the amount of assistance

payments under this section on behalf of a family, the monthly

assistance payment for any family assisted under this subsection

shall be the amount by which the fair market rental for the area

established under subsection (c)(1) of this section exceeds 30

percent of the family's monthly adjusted income; except that the

monthly assistance payment shall not exceed the amount by which the

monthly homeownership expenses, as determined in accordance with

requirements established by the Secretary, exceeds 10 percent of

the family's monthly income.

"(B) Exclusion of equity from income. - For purposes of

determining the monthly assistance payment for a family, the

Secretary shall not include in family income an amount imputed from

the equity of the family in a dwelling occupied by the family with

assistance under this subsection."

Subsec. (y)(3), (4). Pub. L. 105-276, Sec. 555(a)(3), added pars.

(3) and (4) and struck out former pars. (3) and (4) which read as

follows:

"(3) Recapture of certain amounts. - Upon sale of the dwelling by

the family, the Secretary shall recapture from any net proceeds the

amount of additional assistance (as determined in accordance with

requirements established by the Secretary) paid to or on behalf of

the eligible family as a result of paragraph (2)(B).

"(4) Downpayment requirement. - Each public housing agency

providing assistance under this subsection shall ensure that each

family assisted shall provide from its own resources not less than

80 percent of any downpayment in connection with a loan made for

the purchase of a dwelling. Such resources may include amounts from

any escrow account for the family established under section

1437u(d) of this title. Not more than 20 percent of the downpayment

may be provided from other sources, such as from nonprofit entities

and programs of States and units of general local government."

Subsec. (y)(5). Pub. L. 105-276, Sec. 555(a)(3), (4),

redesignated par. (6) as (5) and struck out heading and text of

former par. (5). Text read as follows: "A family may not receive

assistance under this subsection during any period when assistance

is being provided for the family under other Federal homeownership

assistance programs, as determined by the Secretary, including

assistance under the HOME Investment Partnerships Act, the

Homeownership and Opportunity Through HOPE Act, title II of the

Housing and Community Development Act of 1987, and section 1472 of

this title."

Subsec. (y)(6) to (8). Pub. L. 105-276, Sec. 555(a)(4),

redesignated pars. (7) and (8) as (6) and (7), respectively. Former

par. (6) redesignated (5).

Subsec. (z). Pub. L. 105-276, Sec. 548(1), made technical

amendment relating to placement of subsection.

Subsec. (cc). Pub. L. 105-276, Sec. 548(2), added subsec. (cc).

Subsec. (dd). Pub. L. 105-276, Sec. 556(a), added subsec. (dd).

1997 - Subsec. (c)(2)(A). Pub. L. 105-65, Secs. 201(c), 205,

substituted "fiscal years 1997 and 1998" for "fiscal year 1997" in

third and sixth sentences and inserted at end "In establishing

annual adjustment factors for units in new construction and

substantial rehabilitation projects, the Secretary shall take into

account the fact that debt service is a fixed expense. The

immediately foregoing sentence shall be effective only during

fiscal year 1998."

Pub. L. 105-33, Secs. 2003, 2004, inserted ", and during fiscal

year 1999 and thereafter" before period at end of third and sixth

sentences.

Subsec. (c)(9). Pub. L. 105-18, which directed substitution of

"Not less than 180 days prior to terminating any contract" for "Not

less than one year prior to terminating any contract", was executed

by making the substitution for "Not less than 1 year prior to

terminating any contract" to reflect the probable intent of

Congress.

Subsec. (d)(5). Pub. L. 105-65, Sec. 523(a), added par. (5).

Subsec. (bb). Pub. L. 105-65, Sec. 523(c), inserted heading,

designated existing provisions as par. (1) and former subsec.

heading as par. (1) heading, and added par. (2).

1996 - Subsec. (c)(2)(A). Pub. L. 104-204 inserted ", fiscal year

1996 prior to April 26, 1996, and fiscal year 1997" after "fiscal

year 1995" in two places, substituted "Except for assistance under

the certificate program, for" for "For", inserted after fourth

sentence "In the case of assistance under the certificate program,

0.01 shall be subtracted from the amount of the annual adjustment

factor (except that the factor shall not be reduced to less than

1.0), and the adjusted rent shall not exceed the rent for a

comparable unassisted unit of similar quality, type, and age in the

market area.", and substituted "The immediately foregoing two

sentences" for "The immediately foregoing sentence".

Subsec. (c)(8). Pub. L. 104-134, Sec. 101(e) [title II, Sec.

203(b)(1), (d)], temporarily inserted "(other than a contract for

assistance under the certificate or voucher program)" after

"section". See Effective and Termination Dates of 1996 Amendments

note below.

Subsec. (c)(9). Pub. L. 104-134, Sec. 101(e) [title II, Sec.

203(b)(2), (d)], temporarily substituted ", other than a contract

under the certificate or voucher program" for "(but not less than

90 days in the case of housing certificates or vouchers under

subsection (b) or (o) of this section)". See Effective and

Termination Dates of 1996 Amendments note below.

Subsec. (d)(1)(A). Pub. L. 104-99, Sec. 402(d)(2), (f),

temporarily amended subpar. (A) generally, substituting "the

selection of tenants shall be the function of the owner, subject to

the provisions of the annual contributions contract between the

Secretary and the agency, except that for the certificate and

moderate rehabilitation programs only, for the purpose of selecting

families to be assisted, the public housing agency may establish,

after public notice and an opportunity for public comment, a

written system of preferences for selection that is not

inconsistent with the comprehensive housing affordability strategy

under title I of the Cranston-Gonzalez National Affordable Housing

Act;" for "the selection of tenants for such units shall be the

function of the owner, subject to the provisions of the annual

contributions contract between the Secretary and the agency, except

that the tenant selection criteria used by the owner shall -

"(i) for not less than (I) 70 percent of the families who

initially receive assistance in any 1-year period in the case of

assistance attached to a structure and (II) 90 percent of such

families in the case of assistance not attached to a structure,

give preference to families that occupy substandard housing

(including families that are homeless or living in a shelter for

homeless families), are paying more than 50 percent of family

income for rent, or are involuntarily displaced (including

displacement because of disposition of a multifamily housing

project under section 1701z-11 of title 12) at the time they are

seeking assistance under this section; except that any family

otherwise eligible for assistance under this section may not be

denied preference for assistance not attached to a structure (or

delayed or otherwise adversely affected in the provision of such

assistance) solely because the family resides in public housing;

"(ii) for any remaining assistance in any 1-year period, give

preference to families who qualify under a system of local

preferences established by the public housing agency in writing

and after public hearing to respond to local housing needs and

priorities, which may include (I) assisting very low-income

families who either reside in transitional housing assisted under

title IV of the Stewart B. McKinney Homeless Assistance Act, or

participate in a program designed to provide public assistance

recipients with greater access to employment and educational

opportunities; (II) assisting families in accordance with

subsection (u)(2) of this section; (III) assisting families

identified by local public agencies involved in providing for the

welfare of children as having a lack of adequate housing that is

a primary factor in the imminent placement of a child in foster

care, or in preventing the discharge of a child from foster care

and reunification with his or her family; (IV) assisting youth,

upon discharge from foster care, in cases in which return to the

family or extended family or adoption is not available; (V)

assisting veterans who are eligible and have applied for

assistance, will use the assistance for a dwelling unit designed

for the handicapped, and, upon discharge or eligibility for

discharge from a hospital or nursing home, have physical

disability which, because of the configuration of their homes,

prevents them from access to or use of their homes; and (VI)

achieving other objectives of national housing policy as affirmed

by Congress; and

"(iii) prohibit any individual or family evicted from housing

assisted under the chapter by reason of drug-related criminal

activity from having a preference under any provision of this

subparagraph for 3 years unless the evicted tenant successfully

completes a rehabilitation program approved by the agency, except

that the agency may waive the application of this clause under

standards established by the Secretary (which shall include

waiver for any member of a family of an individual prohibited

from tenancy under this clause who the agency determines clearly

did not participate in and had no knowledge of such criminal

activity or when circumstances leading to eviction no longer

exist);".

See Effective and Termination Dates of 1996 Amendments note below.

Subsec. (d)(1)(B)(ii), (iii). Pub. L. 104-134, Sec. 101(e) [title

II, Sec. 203(c), (d)], in cl. (ii) temporarily inserted "during the

term of the lease," after "(ii)" and in cl. (iii) temporarily

substituted "during the term of the lease," for "provide that". See

Effective and Termination Dates of 1996 Amendments note below.

Subsec. (d)(1)(B)(v). Pub. L. 104-193, Sec. 903(a)(2), added cl.

(v).

Subsec. (d)(2)(A). Pub. L. 104-99, Sec. 402(d)(6)(A)(iii), (f),

temporarily struck out at end "Any assistance provided to lower

income tenants under the preceding sentence shall not be considered

for purposes of the limitation under paragraph (1)(A) regarding the

percentage of families that may receive assistance under this

section who do not qualify for preferences under such paragraph."

See Effective and Termination Dates of 1996 Amendments note below.

Subsec. (d)(2)(H). Pub. L. 104-99, Sec. 402(d)(6)(A)(iv), (f),

temporarily substituted "An owner" for "Notwithstanding subsection

(d)(1)(A)(i) of this section, an owner". See Effective and

Termination Dates of 1996 Amendments note below.

Subsec. (o)(3)(B). Pub. L. 104-99, Sec. 402(d)(3), (f),

temporarily amended subpar. (B) generally. Prior to amendment,

subpar. (B) read as follows: "In selecting families to be assisted,

preference shall be given to families which, at the time they are

seeking assistance, occupy substandard housing (including families

that are homeless or living in a shelter for homeless families),

are involuntarily displaced (including displacement because of

disposition of a multifamily housing project under section 1701z-11

of title 12), or are paying more than 50 per centum of family

income for rent. A public housing agency may provide for

circumstances in which families who do not qualify for any

preference established in the preceding sentence are provided

assistance under this subsection before families who do qualify for

such preference, except that not more than 10 percent (or such

higher percentage determined by the Secretary to be necessary to

ensure that public housing agencies can assist families in

accordance with subsection (u)(2) of this section or determined by

the Secretary to be appropriate for other good cause) of the

families who initially receive assistance in any 1-year period (or

such shorter period selected by the public housing agency before

the beginning of its first full year subject to this sentence) may

be families who do not qualify for such preference. The public

housing agency shall in implementing the preceding sentence

establish a system of preferences in writing and after public

hearing to respond to local housing needs and priorities which may

include (i) assisting very low-income families who either reside in

transitional housing assisted under title IV of the Stewart B.

McKinney Homeless Assistance Act, or participate in a program

designed to provide public assistance recipients with greater

access to employment and educational opportunities, (ii) assisting

families in accordance with subsection (u)(2) of this section;

(iii) assisting families identified by local public agencies

involved in providing for the welfare of children as having a lack

of adequate housing that is a primary factor in the imminent

placement of a child in foster care, or in preventing the discharge

of a child from foster care and reunification and his or her

family; (iv) assisting youth, upon discharge from foster care, in

cases in which return to the family or extended family or adoption

is not available; (v) assisting veterans who are eligible and have

applied for assistance, will use the assistance for a dwelling unit

designed for the handicapped, and, upon discharge or eligibility

for discharge from a hospital or nursing home, have physical

disability which, because of the configuration of their homes,

prevents them from access to or use of their homes; and (vi)

achieving other objectives of national housing policy as affirmed

by Congress. Any individual or family evicted from housing assisted

under the chapter by reason of drug-related criminal activity (as

defined in subsection (f)(5) of this section) shall not be eligible

for a preference under any provision of this subparagraph for 3

years unless the evicted tenant successfully completes a

rehabilitation program approved by the Secretary (which shall

include waiver for any member of a family of an individual

prohibited from tenancy under this clause who the agency determines

clearly did not participate in and had no knowledge of such

criminal activity or when circumstances leading to eviction no

longer exist)." See Effective and Termination Dates of 1996

Amendments note below.

Subsec. (t). Pub. L. 104-134, Sec. 101(e) [title II, Sec. 203(a),

(d)], temporarily repealed subsec. (t) which read as follows:

"(1) No owner who has entered into a contract for housing

assistance payments under this section on behalf of any tenant in a

multifamily housing project shall refuse -

"(A) to lease any available dwelling unit in any multifamily

housing project of such owner that rents for an amount not

greater than the fair market rent for a comparable unit, as

determined by the Secretary under this section, to a holder of a

certificate of eligibility under this section a proximate cause

of which is the status of such prospective tenant as a holder of

such certificate, and to enter into a housing assistance payments

contract respecting such unit; or

"(B) to lease any available dwelling unit in any multifamily

housing project of such owner to a holder of a voucher under

subsection (o) of this section, and to enter into a voucher

contract respecting such unit, a proximate cause of which is the

status of such prospective tenant as holder of such voucher.

"(2) For purposes of this subsection, the term 'multifamily

housing project' means a residential building containing more than

4 dwelling units." See Effective and Termination Dates of 1996

Amendments note below.

Subsec. (v). Pub. L. 104-99, Sec. 405(c), amended subsec. (v)

generally. Prior to amendment, subsec. (v) read as follows:

"(1) The Secretary shall extend any expiring contract entered

into under this section for loan management assistance or execute a

new contract for project-based loan management assistance, if the

owner agrees to continue providing housing for low-income families

during the term of the contract.

"(2)(A) The eligiblity of a multifamily residential project for

loan management assistance under this section shall be determined

without regard to whether the project is subsidized or

unsubsidized.

"(B) In allocating loan management assistance under this section,

the Secretary may give a priority to any project only on the basis

that the project has serious financial problems that are likely to

result in a claim on the insurance fund in the near future or the

project is eligible to receive incentives under subtitle B of the

Low-Income Housing Preservation and Resident Homeownership Act of

1990."

Subsec. (bb). Pub. L. 104-134, Sec. 101[(e)] [title II, Sec.

208], added subsec. (bb).

1995 - Subsec. (z). Pub. L. 104-19 added subsec. (z).

1994 - Subsec. (c)(2)(A). Pub. L. 103-327 inserted at end:

"However, where the maximum monthly rent, for a unit in a new

construction, substantial rehabilitation, or moderate

rehabilitation project, to be adjusted using an annual adjustment

factor exceeds the fair market rental for an existing dwelling unit

in the market area, the Secretary shall adjust the rent only to the

extent that the owner demonstrates that the adjusted rent would not

exceed the rent for an unassisted unit of similar quality, type,

and age in the same market area, as determined by the Secretary.

The immediately foregoing sentence shall be effective only during

fiscal year 1995. For any unit occupied by the same family at the

time of the last annual rental adjustment, where the assistance

contract provides for the adjustment of the maximum monthly rent by

applying an annual adjustment factor and where the rent for a unit

is otherwise eligible for an adjustment based on the full amount of

the factor, 0.01 shall be subtracted from the amount of the factor,

except that the factor shall not be reduced to less than 1.0. The

immediately foregoing sentence shall be effective only during

fiscal year 1995."

Subsec. (d)(1)(A)(i). Pub. L. 103-233, Sec. 101(c)(2), inserted

"(including displacement because of disposition of a multifamily

housing project under section 1701z-11 of title 12)" after

"displaced".

Subsec. (d)(1)(A)(ii). Pub. L. 103-327 which directed the

amendment of cl. (ii) by striking "and (V)" and inserting in lieu

thereof "(V) assisting families that include one or more adult

members who are employed; and (VI)", and inserting after the final

semicolon "subclause (V) shall be effective only during fiscal year

1995;", was not executed because the words "and (V)" did not appear

and cl. (ii) already contains subcls. (V) and (VI). See 1992

Amendment note below.

Subsec. (f)(1). Pub. L. 103-233, Sec. 101(d), inserted "an agency

of the Federal Government," after "cooperative,".

Subsec. (o)(3)(B). Pub. L. 103-233, Sec. 101(c)(3), inserted

"(including displacement because of disposition of a multifamily

housing project under section 1701z-11 of title 12)" after

"displaced".

Subsec. (aa). Pub. L. 103-327 temporarily added subsec. (aa),

"Refinancing incentive", which read as follows:

"(1) In general. - The Secretary may pay all or a part of the up

front costs of refinancing for each project that -

"(A) is constructed, substantially rehabilitated, or moderately

rehabilitated under this section;

"(B) is subject to an assistance contract under this section;

and

"(C) was subject to a mortgage that has been refinanced under

section 223(a)(7) or section 223(f) of the National Housing Act

to lower the periodic debt service payments of the owner.

"(2) Share from reduced assistance payments. - The Secretary may

pay the up front cost of refinancing only -

"(A) to the extent that funds accrue to the Secretary from the

reduced assistance payments that results from the refinancing;

and

"(B) after the application of amounts in accordance with

section 1012 of the Stewart B. McKinney Homeless Assistance

Amendments Act of 1988."

See Effective and Termination Dates of 1994 Amendment note below.

1992 - Subsec. (c)(2)(B). Pub. L. 102-550, Sec. 1012(g), inserted

at end "The Secretary may (at the discretion of the Secretary and

subject to the availability of appropriations for contract

amendments), on a project by project basis for projects receiving

project-based assistance, provide adjustments to the maximum

monthly rents to cover the costs of evaluating and reducing

lead-based paint hazards, as defined in section 4851b of this

title."

Pub. L. 102-550, Sec. 142, inserted after first sentence "The

Secretary shall make additional adjustments in the maximum monthly

rent for units under contract (subject to the availability of

appropriations for contract amendments) to the extent the Secretary

determines such adjustments are necessary to reflect increases in

the actual and necessary expenses of owning and maintaining the

units that have resulted from the expiration of a real property tax

exemption."

Subsec. (c)(4). Pub. L. 102-550, Sec. 141(a), inserted "or by a

family that qualifies to receive assistance under subsection (b) of

this section pursuant to section 223 or 226 of the Low-Income

Housing Preservation and Resident Homeownership Act of 1990" after

first comma in first sentence.

Subsec. (c)(9). Pub. L. 102-550, Sec. 143, inserted before period

at end ", and such term shall include termination of the contract

for business reasons".

Subsec. (d)(1)(A)(ii)(V), (VI). Pub. L. 102-550, Sec. 144(a),

added subcl. (V) and redesignated former subcl. (V) as (VI).

Subsec. (d)(1)(B)(iii). Pub. L. 102-550, Sec. 145, inserted ",

any criminal activity that threatens the health, safety, or right

to peaceful enjoyment of their residences by persons residing in

the immediate vicinity of the premises," before "or any

drug-related" and substituted "tenant of any unit" for "public

housing tenant".

Subsec. (d)(2)(F). Pub. L. 102-550, Sec. 674, added subpar. (F).

Subsec. (d)(2)(G), (H). Pub. L. 102-550, Sec. 682(b), added

subpars. (G) and (H).

Subsec. (d)(4). Pub. L. 102-550, Sec. 660, added par. (4).

Subsec. (f)(6), (7). Pub. L. 102-550, Sec. 146, added pars. (6)

and (7).

Subsec. (i). Pub. L. 102-550, Sec. 623(b), added subsec. (i).

Subsec. (o)(3)(A). Pub. L. 102-550, Sec. 141(b), struck out "or"

before "(iv)" and inserted before period at end ", or" and cl. (v).

Subsec. (o)(3)(B)(v), (vi). Pub. L. 102-550, Sec. 144(b), in

third sentence, added cl. (v) and redesignated former cl. (v) as

(vi).

Subsec. (q)(3), (4). Pub. L. 102-550, Sec. 675, added par. (3)

and redesignated former par. (3) as (4).

Subsec. (r)(1). Pub. L. 102-550, Sec. 147, inserted before period

at end "; except that any family not living within the jurisdiction

of a public housing agency at the time that such family applies for

assistance from such agency shall, during the 12-month period

beginning upon the receipt of any tenant-based rental assistance

made available on behalf of the family, use such assistance to rent

an eligible dwelling unit located within the jurisdiction served by

such public housing agency".

Subsec. (x)(1). Pub. L. 102-550, Sec. 148, amended par. (1)

generally. Prior to amendment, par. (1) read as follows: "The

budget authority available under section 1437c(c) of this title for

assistance under subsection (b) of this section is authorized to be

increased by $35,000,000 on or after October 1, 1990, by

$35,000,000 on or after October 1, 1991."

Subsec. (y). Pub. L. 102-550, Sec. 185(a), added subsec. (y).

1991 - Subsec. (c)(1). Pub. L. 102-139 inserted provisions

relating to separate fair market rentals for Monroe County,

Pennsylvania.

1990 - Subsec. (a). Pub. L. 101-625, Sec. 572(1), which directed

the substitution of "low-income families" for "lower income

families", was executed by making the substitution for

"lower-income families" to reflect the probable intent of Congress.

Pub. L. 101-625, Sec. 548(b), inserted at end "A public housing

agency may contract to make assistance payments to itself (or any

agency or instrumentality thereof) as the owner of dwelling units

if such agency is subject to the same program requirements as are

applied to other owners. In such cases, the Secretary may establish

initial rents within applicable limits."

Subsec. (b). Pub. L. 101-625, Sec. 541(a), inserted heading and

struck out par. (1) designation preceding text.

Subsec. (b)(2). Pub. L. 101-625, Sec. 413(b)(1), added par. (2).

Subsec. (c)(1). Pub. L. 101-625, Sec. 543(b), inserted "(A)"

after second reference to "fair market rental" and substituted "a

housing strategy as defined in section 12705 of this title, or (B)

by such higher amount as may be requested by a tenant and approved

by the public housing agency in accordance with paragraph (3)(B)."

for "a local housing assistance plan as defined in section

1439(a)(5) of this title."

Subsec. (c)(2)(B). Pub. L. 101-625, Sec. 542, inserted at end

"Where the Secretary determines that a project assisted under this

section is located in a community where drug-related criminal

activity is generally prevalent and the project's operating,

maintenance, and capital repair expenses have been substantially

increased primarily as a result of the prevalence of such

drug-related activity, the Secretary may (at the discretion of the

Secretary and subject to the availability of appropriations for

contract amendments for this purpose), on a project by project

basis, provide adjustments to the maximum monthly rents, to a level

no greater than 120 percent of the project rents, to cover the

costs of maintenance, security, capital repairs, and reserves

required for the owner to carry out a strategy acceptable to the

Secretary for addressing the problem of drug-related criminal

activity. Any rent comparability standard required under this

paragraph may be waived by the Secretary to so implement the

preceding sentence."

Subsec. (c)(3). Pub. L. 101-625, Sec. 543(a), designated existing

provisions as subpar. (A) and added subpar. (B).

Subsec. (c)(9). Pub. L. 101-625, Sec. 544, inserted after first

sentence "The owner's notice shall include a statement that the

owner and the Secretary may agree to a renewal of the contract,

thus avoiding the termination." and inserted at end "Within 30 days

of the Secretary's finding, the owner shall provide written notice

to each tenant of the Secretary's decision."

Subsec. (c)(10). Pub. L. 101-625, Sec. 572(2), substituted

"low-income housing" for "lower income housing".

Subsec. (d)(1)(A). Pub. L. 101-625, Sec. 545(a), amended subpar.

(A) generally. Prior to amendment, subpar. (A) read as follows:

"the selection of tenants for such unit shall be the function of

the owner, subject to the provisions of the annual contributions

contract between the Secretary and the agency, except that (i) the

tenant selection criteria used by the owner shall give preference

to families which occupy substandard housing, are paying more than

50 per centum of family income for rent, or are involuntarily

displaced at the time they are seeking assistance under this

section; and (ii) the public housing agency may provide for

circumstances in which families who do not qualify for any

preference established in clause (i) are provided assistance before

families who do qualify for such preference, except that not more

than 10 percent (or such higher percentage determined by the

Secretary to be necessary to ensure that public housing agencies

can assist families in accordance with subsection (u)(2) of this

section or determined by the Secretary to be appropriate for other

good cause) of the families who initially receive assistance in any

1-year period (or such shorter period selected by the public

housing agency before the beginning of its first full year subject

to this clause) may be families who do not qualify for such

preference;".

Subsec. (d)(1)(B)(iii), (iv). Pub. L. 101-625, Sec. 546, added

cls. (iii) and (iv).

Subsec. (d)(2)(A). Pub. L. 101-625, Sec. 552(b), inserted after

first sentence "The Secretary shall permit public housing agencies

to enter into contracts for assistance payments of less than 12

months duration in order to avoid disruption in assistance to

eligible families if the annual contributions contract is within 1

year of its expiration date."

Pub. L. 101-625, Sec. 613(a)(1), inserted at end "Notwithstanding

any other provision of this section, a public housing agency and an

applicable State agency may, on a priority basis, attach to

structures not more than an additional 15 percent of the assistance

provided by the public housing agency or the applicable State

agency only with respect to projects assisted under a State program

that permits the owner of the projects to prepay a State assisted

or subsidized mortgage on the structure, except that attachment of

assistance under this sentence shall be for the purpose of (i)

providing incentives to owners to preserve such projects for

occupancy by lower and moderate income families (for the period

that assistance under this sentence is available), and (ii) to

assist lower income tenants to afford any increases in rent that

may be required to induce the owner to maintain occupancy in the

project by lower and moderate income tenants. Any assistance

provided to lower income tenants under the preceding sentence shall

not be considered for purposes of the limitation under paragraph

(1)(A) regarding the percentage of families that may receive

assistance under this section who do not qualify for preferences

under such paragraph."

Subsec. (d)(2)(C). Pub. L. 101-625, Sec. 613(a)(2), inserted at

end "To the extent assistance is used as provided in the

penultimate sentence of subparagraph (A), the contract for

assistance may, at the option of the public housing agency, have an

initial term not exceeding 15 years."

Pub. L. 101-625, Sec. 547(c), amended subpar. (C) generally.

Prior to amendment, subpar. (C) read as follows: "Any contract for

assistance payments that is attached to a structure under this

paragraph shall (at the option of the public housing agency but

subject to available funds) be renewable for 2 additional 5-year

terms, except that the aggregate term of the initial contract and

renewals shall not exceed 15 years."

Subsec. (d)(2)(D), (E). Pub. L. 101-625, Sec. 547(a), (b), added

subpars. (D) and (E).

Subsec. (e)(2). Pub. L. 101-625, Sec. 289(b), struck out par. (2)

which read as follows: "For the purpose of upgrading and thereby

preserving the Nation's housing stock, the Secretary is authorized

to make assistance payments under this section directly or through

public housing agencies pursuant to contracts with owners or

prospective owners who agree to upgrade housing so as to make and

keep such housing decent, safe, and sanitary through upgrading

which involves less than substantial rehabilitation, as such

upgrading and rehabilitation are defined by the Secretary, and

which shall involve a minimum expenditure of $3,000 for a unit,

including its prorated share of work to be accomplished on common

areas or systems. The Secretary is authorized to prescribe such

terms and conditions for contracts entered into under this section

pursuant to this paragraph as the Secretary determines to be

necessary and appropriate, except that such terms and conditions,

to the maximum extent feasible, shall be consistent with terms and

conditions otherwise applicable with respect to other dwelling

units assisted under this section. Notwithstanding subsection

(c)(1) of this section, the Secretary may, in carrying out the

preceding sentence, establish a maximum monthly rent (for units

upgraded pursuant to this paragraph) which exceeds the fair market

rental by not more than 20 per centum if such units are located in

an area where the Secretary finds cost levels so require, except

that the Secretary may approve maximum monthly rents which exceed

the fair market rentals by more than 20 but not more than 30 per

centum where the Secretary determines that special circumstances

warrant such higher rent or where necessary to the implementation

of a local housing assistance plan. The Secretary is also

authorized to make assistance available under this section pursuant

to this paragraph to any unit in a housing project which, on an

overall basis, reflects the need for such upgrading. The Secretary

shall increase the amount of assistance provided under this

paragraph above the amount of assistance otherwise permitted by

this paragraph and subsection (c)(1) of this section, if the

Secretary determines such increase necessary to assist in the sale

of multifamily housing projects owned by the Department of Housing

and Urban Development. In order to maximize the availability of

low-income housing, in providing assistance under this paragraph,

the Secretary shall include in any calculation or determination

regarding the amount of the assistance to be made available the

extent to which any proceeds are available from any tax credits

provided under section 42 of title 26 (or from any syndication of

such credits) with respect to the housing. For each fiscal year,

the Secretary may not provide assistance pursuant to this paragraph

to any project for rehabilitation of more than 100 units.

Assistance pursuant to this paragraph shall be allocated according

to the formula established pursuant to section 1439(d) of this

title, and awarded pursuant to a competition under such section.

The Secretary shall maintain a single listing of any assistance

provided pursuant to this paragraph, which shall include a

statement identifying the owner and location of the project to

which assistance was made, the amount of the assistance, and the

number of units assisted."

Subsec. (f)(1). Pub. L. 101-625, Sec. 548(a), substituted

"dwelling units" for "newly constructed or substantially

rehabilitated dwelling units as described in this section".

Subsec. (f)(4), (5). Pub. L. 101-625, Sec. 549, added pars. (4)

and (5).

Subsec. (j)(1). Pub. L. 101-625, Sec. 572(1), substituted

"low-income families" for "lower income families" in introductory

provisions.

Subsec. (o). Pub. L. 101-625, Sec. 541(b), inserted heading.

Subsec. (o)(3). Pub. L. 101-625, Sec. 545(2)[(b)], inserted "(A)"

after "(3)", redesignated former cls. (A) to (D) as cls. (i) to

(iv), respectively, inserted "(B)" before "In selecting families",

"(including families that are homeless or living in a shelter for

homeless families)" after "substandard housing", and inserted at

end "The public housing agency shall in implementing the preceding

sentence establish a system of preferences in writing and after

public hearing to respond to local housing needs and priorities

which may include (i) assisting very low-income families who either

reside in transitional housing assisted under title IV of the

Stewart B. McKinney Homeless Assistance Act, or participate in a

program designed to provide public assistance recipients with

greater access to employment and educational opportunities, (ii)

assisting families in accordance with subsection (u)(2) of this

section; (iii) assisting families identified by local public

agencies involved in providing for the welfare of children as

having a lack of adequate housing that is a primary factor in the

imminent placement of a child in foster care, or in preventing the

discharge of a child from foster care and reunification and his or

her family; (iv) assisting youth, upon discharge from foster care,

in cases in which return to the family or extended family or

adoption is not available; and (v) achieving other objectives of

national housing policy as affirmed by Congress. Any individual or

family evicted from housing assisted under the chapter by reason of

drug-related criminal activity (as defined in subsection (f)(5) of

this section) shall not be eligible for a preference under any

provision of this subparagraph for 3 years unless the evicted

tenant successfully completes a rehabilitation program approved by

the Secretary (which shall include waiver for any member of a

family of an individual prohibited from tenancy under this clause

who the agency determines clearly did not participate in and had no

knowledge of such criminal activity or when circumstances leading

to eviction no longer exist)."

Pub. L. 101-625, Sec. 413(a), added cl. (D).

Subsec. (o)(7). Pub. L. 101-625, Sec. 572(1), substituted

"low-income families" for "lower income families".

Subsec. (o)(9). Pub. L. 101-625, Sec. 413(b)(2), added par. (9).

Subsec. (o)(10), (11). Pub. L. 101-625, Sec. 550(a), (c), added

pars. (10) and (11).

Subsec. (r)(1). Pub. L. 101-625, Sec. 551, substituted "the same

State, or the same or a contiguous" for "the same, or a

contiguous,".

Subsec. (u). Pub. L. 101-625, Sec. 572(1), substituted

"low-income families" for "lower income families" in introductory

provisions.

Subsec. (v)(1). Pub. L. 101-625, Sec. 572(1), substituted

"low-income families" for "lower income families".

Subsec. (v)(2)(B). Pub. L. 101-625, Sec. 603, which directed the

substitution of "Low-Income Housing Preservation and Resident

Homeownership Act of 1990" for "Emergency Low Income Housing

Preservation Act of 1987" in section "89(v)(2) of the United States

Housing Act of 1937", was executed to subsec. (v)(2)(B) of this

section (section 8 of the United States Housing Act of 1937) to

reflect the probable intent of Congress.

Subsecs. (w), (x). Pub. L. 101-625, Secs. 552(a), 553, added

subsecs. (w) and (x).

1989 - Subsec. (c)(2)(C). Pub. L. 101-235, Sec. 702(g),

substituted "quality, type, and age" for "quality and age".

Pub. L. 101-235, Sec. 702(c), inserted after first sentence "In

implementing the limitation established under the preceding

sentence, the Secretary shall establish regulations for conducting

comparability studies for projects where the Secretary has reason

to believe that the application of the formula adjustments under

subparagraph (A) would result in such material differences. The

Secretary shall conduct such studies upon the request of any owner

of any project, or as the Secretary determines to be appropriate by

establishing, to the extent practicable, a modified annual

adjustment factor for such market area, as the Secretary shall

designate, that is geographically smaller than the applicable

housing area used for the establishment of the annual adjustment

factor under subparagraph (A). The Secretary shall establish such

modified annual adjustment factor on the basis of the results of a

study conducted by the Secretary of the rents charged, and any

change in such rents over the previous year, for assisted units and

unassisted units of similar quality, type, and age in the smaller

market area. Where the Secretary determines that such modified

annual adjustment factor cannot be established or that such factor

when applied to a particular project would result in material

differences between the rents charged for assisted units and

unassisted units of similar quality, type, and age in the same

market area, the Secretary may apply an alternative methodology for

conducting comparability studies in order to establish rents that

are not materially different from rents charged for comparable

unassisted units."

Subsec. (e)(2). Pub. L. 101-235, Sec. 127(1), inserted before

period at end of first sentence ", and which shall involve a

minimum expenditure of $3,000 for a unit, including its prorated

share of work to be accomplished on common areas or systems".

Pub. L. 101-235, Sec. 127(2), (3), inserted at end "In order to

maximize the availability of low-income housing, in providing

assistance under this paragraph, the Secretary shall include in any

calculation or determination regarding the amount of the assistance

to be made available the extent to which any proceeds are available

from any tax credits provided under section 42 of title 26 (or from

any syndication of such credits) with respect to the housing. For

each fiscal year, the Secretary may not provide assistance pursuant

to this paragraph to any project for rehabilitation of more than

100 units. Assistance pursuant to this paragraph shall be allocated

according to the formula established pursuant to section 1439(d) of

this title, and awarded pursuant to a competition under such

section. The Secretary shall maintain a single listing of any

assistance provided pursuant to this paragraph, which shall include

a statement identifying the owner and location of the project to

which assistance was made, the amount of the assistance, and the

number of units assisted."

1988 - Subsec. (b)(1). Pub. L. 100-242, Sec. 141, inserted

provisions at end authorizing Secretary to enter into separate

contributions contracts with each public housing agency to obligate

authority approved each year, beginning with fiscal year 1988.

Subsec. (c)(1). Pub. L. 100-242, Sec. 142(a), inserted before

last sentence "Each fair market rental in effect under this

subsection shall be adjusted to be effective on October 1 of each

year to reflect changes, based on the most recent available data

trended so the rentals will be current for the year to which they

apply, of rents for existing or newly constructed rental dwelling

units, as the case may be, of various sizes and types in the market

area suitable for occupancy by persons assisted under this

section."

Pub. L. 100-242, Sec. 142(b), inserted at end "The Secretary

shall establish separate fair market rentals under this paragraph

for Westchester County in the State of New York."

Pub. L. 100-242, Sec. 142(c)(1), inserted at end "If units

assisted under this section are exempt from local rent control

while they are so assisted or otherwise, the maximum monthly rent

for such units shall be reasonable in comparison with other units

in the market area that are exempt from local rent control."

Subsec. (c)(2)(C). Pub. L. 100-628, Sec. 1004(a)(1), substituted

"under subparagraphs (A) and (B)" for "as hereinbefore provided".

Pub. L. 100-628, Sec. 1004(a)(2), inserted at end "Any maximum

monthly rent that has been reduced by the Secretary after April 14,

1987, and prior to November 7, 1988, shall be restored to the

maximum monthly rent in effect on April 15, 1987. For any project

which has had its maximum monthly rents reduced after April 14,

1987, the Secretary shall make assistance payments (from amounts

reserved for the original contract) to the owner of such project in

an amount equal to the difference between the maximum monthly rents

in effect on April 15, 1987, and the reduced maximum monthly rents,

multiplied by the number of months that the reduced maximum monthly

rents were in effect."

Pub. L. 100-242, Sec. 142(c)(2), substituted "assisted units and

unassisted units of similar quality and age in the same market

area" for "assisted and comparable unassisted units" and inserted

at end "If the Secretary or appropriate State agency does not

complete and submit to the project owner a comparability study not

later than 60 days before the anniversary date of the assistance

contract under this section, the automatic annual adjustment factor

shall be applied."

Pub. L. 100-242, Sec. 142(d), inserted at end "The Secretary may

not reduce the contract rents in effect on or after April 15, 1987,

for newly constructed, substantially rehabilitated, or moderately

rehabilitated projects assisted under this section (including

projects assisted under this section as in effect prior to November

30, 1983), unless the project has been refinanced in a manner that

reduces the periodic payments of the owner."

Subsec. (c)(2)(D). Pub. L. 100-242, Sec. 142(e), struck out

subpar. (D) which read as follows: "Notwithstanding the foregoing,

the Secretary shall limit increases in contract rents for newly

constructed or substantially rehabilitated projects assisted under

this section to the amount of operating cost increases incurred

with respect to comparable rental dwelling units of various sizes

and types in the same market area which are suitable for occupancy

by families assisted under this section. Where no comparable

dwelling units exist in the same market area, the Secretary shall

have authority to approve such increases in accordance with the

best available data regarding operating cost increases in rental

dwelling units."

Subsec. (c)(9), (10). Pub. L. 100-242, Sec. 262(a), (b), added

pars. (9) and (10).

Subsec. (d)(1)(A). Pub. L. 100-628, Sec. 1014(b), inserted cl.

(i) designation after "except that" and added cl. (ii) before

semicolon at end.

Subsec. (d)(2). Pub. L. 100-628, Sec. 1005(b)(1), designated

existing provisions as subpar. (A), substituted "(i)" and "(ii)"

for "(A)" and "(B)" wherever appearing, and added subpar. (B).

Pub. L. 100-628, Sec. 1005(c), added subpar. (C).

Pub. L. 100-242, Sec. 148, inserted exception authorizing

Secretary to permit public housing authority to approve attachment

with respect to not more than 15 percent of assistance provided by

public housing agency if requirements of cl. (B) are met.

Subsec. (o)(1). Pub. L. 100-242, Sec. 143(a)(1), substituted "The

Secretary may provide assistance" for "In connection with the

rental rehabilitation and development program under section 1437o

of this title or the rural housing preservation grant program under

section 1490m of this title, or for other purposes, the Secretary

is authorized to conduct a demonstration program".

Subsec. (o)(3). Pub. L. 100-628, Sec. 1014(c), inserted sentence

at end authorizing public housing agencies to provide for

circumstances in which families who do not qualify for any

preference are provided assistance under this subsection before

families who do qualify for such preference.

Subsec. (o)(4). Pub. L. 100-242, Sec. 143(a)(2), (3),

redesignated par. (5) as (4) and struck out former par. (4) which

read as follows: "The Secretary shall use substantially all of the

authority to enter into contracts under this subsection to make

assistance payments for families residing in dwellings to be

rehabilitated with assistance under section 1437o of this title and

for families displaced as a result of rental housing development

assisted under such section or as a result of activities assisted

under section 1490m of this title."

Subsec. (o)(5). Pub. L. 100-242, Sec. 143(a)(3), redesignated

par. (6) as (5). Former par. (5) redesignated (4).

Subsec. (o)(6). Pub. L. 100-242, Sec. 143(a)(3), (b),

redesignated par. (7) as (6), substituted "annually" for "as

frequently as twice during any five-year period" in subpar. (A),

and struck out subpar. (D) which directed that public housing

agency consult with public and units of local government regarding

impact of adjustments made under this section on the number of

families that can be assisted. Former par. (6) redesignated (5).

Subsec. (o)(7). Pub. L. 100-242, Sec. 143(a)(3), (c),

redesignated par. (8) as (7), and struck out "not to exceed 5 per

centum of the amount of" after "utilize". Former par. (7)

redesignated (6).

Subsec. (o)(8). Pub. L. 100-242, Sec. 143(a)(3), (d), added par.

(8). Former par. (8) redesignated (7).

Subsecs. (q) to (u). Pub. L. 100-242, Secs. 144-149, added

subsecs. (q) to (u).

Subsec. (u)(3). Pub. L. 100-628, Sec. 1006, added par. (3).

Subsec. (v). Pub. L. 100-628, Sec. 1029, redesignated par. (2) as

(1) and inserted "for project-based loan management assistance",

added par. (2), and struck out former par. (1) which required that

each contract entered into by Secretary for loan management

assistance be for a term of 180 months.

Pub. L. 100-242, Sec. 262(c), added subsec. (v).

1984 - Subsec. (d)(2). Pub. L. 98-479, Sec. 102(b)(6),

substituted "Where the Secretary enters into an annual

contributions contract with a public housing agency pursuant to

which the agency will enter into a contract for assistance payments

with respect to an existing structure, the contract for assistance

payments may not be attached to the structure unless (A) the

Secretary and the public housing agency approve such action, and

(B) the owner agrees to rehabilitate the structure other than with

assistance under this chapter and otherwise complies with the

requirements of this section." for "A contract under this section

may not be attached to the structure except where the Secretary

specifically waives the foregoing limitation and the public housing

agency approves such action, and the owner agrees to rehabilitate

the structure other than with assistance under this chapter and

otherwise complies with the requirements of this section. The

aggregate term of such contract and any contract extension may not

be more than 180 months."

Subsec. (e)(2). Pub. L. 98-479, Sec. 102(b)(7), inserted at end

"The Secretary shall increase the amount of assistance provided

under this paragraph above the amount of assistance otherwise

permitted by this paragraph and subsection (c)(1) of this section,

if the Secretary determines such increase necessary to assist in

the sale of multifamily housing projects owned by the Department of

Housing and Urban Development."

Subsec. (n). Pub. L. 98-479, Sec. 102(b)(8), substituted

"subsections (b)(1) and (e)(2) of this section" for "subsection

(b)(1), subsection (e)(2) of this section".

Subsec. (o)(3)(C). Pub. L. 98-479, Sec. 102(b)(9), added cl. (C).

Subsec. (o)(7)(D). Pub. L. 98-479, Sec. 102(b)(10), inserted

"unit of" before "general".

1983 - Subsec. (a). Pub. L. 98-181, Sec. 209(a)(1), substituted

"existing housing" for "existing, newly constructed, and

substantially rehabilitated housing".

Subsec. (b)(2). Pub. L. 98-181, Sec. 209(a)(2), repealed par. (2)

which related to authorization of assistance payments by the

Secretary and contractually obligated public housing agencies for

construction or substantial rehabilitation of housing, modest in

design, with units for occupancy by low-income families and

requirement that contracts providing housing assistance and entered

into after Aug. 13, 1981, specify the number of units available for

occupancy by eligible families.

Subsec. (d)(1)(A). Pub. L. 98-181, Sec. 203(b)(1), inserted ",

are paying more than 50 per centum of family income for rent,".

Subsec. (d)(2). Pub. L. 98-181, Sec. 208, inserted second and

third sentences respecting waiver of limitation and limitation of

contract and any extension to prescribed period.

Subsec. (e)(1). Pub. L. 98-181, Sec. 209(a)(3), redesignated par.

(4) as (1) and struck out former par. (1) which prescribed terms of

20 to 30 years for newly constructed or substantially rehabilitated

dwelling units.

Subsec. (e)(2). Pub. L. 98-181, Sec. 209(a)(3), redesignated par.

(5) as (2) and struck out former par. (2) which required owners to

assume ownership, management, and maintenance responsibilities,

including selection of tenants and termination of tenancy for newly

constructed or substantially rehabilitated dwelling units.

Pub. L. 98-181, Sec. 203(b)(2), inserted ", are paying more than

50 per centum of family income for rent," after "substandard

housing".

Subsec. (e)(3). Pub. L. 98-181, Sec. 209(a)(3), struck out par.

(3) which required that construction or substantial rehabilitation

of dwelling units be eligible for mortgages insured under the

National Housing Act and that assistance not be withheld by reason

of availability of mortgage insurance under section 1715z-9 of

title 12 or tax-exempt status obligations used to finance the

construction or rehabilitation.

Subsec. (e)(4), (5). Pub. L. 98-181, Sec. 209(a)(3), redesignated

pars. (4) and (5) as (1) and (2), respectively.

Subsec. (i). Pub. L. 98-181, Sec. 209(a)(4), repealed subsec. (i)

which related to contracts with respect to substantially

rehabilitated dwelling units.

Subsecs. (l), (m). Pub. L. 98-181, Sec. 209(a)(5), repealed

subsec. (l) relating to limitation of cost and rent increases, and

subsec. (m) relating to preference for projects on suitable State

and local government tracts.

Subsec. (n). Pub. L. 98-181, Sec. 209(a)(6), substituted

"subsection (e)(2) of this section" for "subsection (e)(5) and

subsection (i) of this section".

Pub. L. 98-181, Sec. 210(1), (2), inserted "subsection (b)(1) of

this section," before "subsection (e)(5)" and a comma after

"subsection (e)(5) of this section".

Subsec. (n)(3). Pub. L. 98-181, Sec. 210(3)-(5), added par. (3).

Subsec. (o). Pub. L. 98-181, Sec. 207, added subsec. (o).

Subsec. (p). Pub. L. 98-181, Sec. 211, added subsec. (p).

1981 - Subsec. (b)(2). Pub. L. 97-35, Secs. 324(1), 325(1),

inserted provisions relating to increasing housing opportunities

for very low-income families and provisions relating to

availability for occupancy the number of units for which assistance

is committed.

Subsec. (c)(2)(D). Pub. L. 97-35, Sec. 324(2), added par. (D).

Subsec. (c)(3). Pub. L. 97-35, Sec. 322(e)(1), revised formula

for computation of amount of monthly assistance and struck out

authority to make reviews at least every two years in cases of

elderly families.

Subsec. (c)(5). Pub. L. 97-35, Sec. 325(2), inserted reference to

mortgages under section 1720 of title 12.

Subsec. (c)(7). Pub. L. 97-35, Sec. 322(e)(2), struck out par.

(7) relating to percentage requirement for families with very low

income and redesignated former par. (8) as (7).

Subsec. (c)(8). Pub. L. 97-35, Sec. 326(a), added par. (8).

Former par. (8) redesignated (7).

Subsec. (d)(1)(B). Pub. L. 97-35, Sec. 326(e)(1), substituted

provisions relating to terms and conditions, and termination of the

lease by the owner for provisions relating to right of the agency

to give notice to terminate and owner the right to make

representation to agency for termination of the tenancy.

Subsec. (f). Pub. L. 97-35, Sec. 322(e)(3), struck out pars. (1)

to (3) which defined "lower income families", "very low-income

families" and "income", respectively, and redesignated pars. (4) to

(6) as (1) to (3), respectively.

Subsec. (h). Pub. L. 97-35, Sec. 322(e)(4), (5), struck out

reference to section 1437a(1) of this title.

Subsec. (j). Pub. L. 97-35, Sec. 329H(a), generally revised and

reorganized provisions and, as so revised and reorganized,

substituted provisions relating to contracts to make assistance

payments to assist lower income families by making rental

assistance payments on behalf of such family, for provisions

relating to annual contributions contracts to assist lower income

families by making rental assistance payments.

Subsec. (j)(3). Pub. L. 97-35, Sec. 322(e)(6), substituted in

par. (3) "the rent the family is required to pay under section

1437a(a) of this title" for "25 per centum of one-twelfth of the

annual income of such family".

Subsecs. (l) to (n). Pub. L. 97-35, Sec. 324(3), added subsecs.

(l) to (n).

1980 - Subsec. (c)(1). Pub. L. 96-399, Sec. 203(a), inserted

provision that in the case of newly constructed and substantially

rehabilitated units, the exception in the preceding sentence shall

not apply to more than 20 per centum of the total amount of

authority to enter into annual contributions contracts for such

units which is allocated to an area and obligated with respect to

any fiscal year beginning on or after Oct. 1, 1980.

Subsec. (e)(5). Pub. L. 96-399, Sec. 203(b), inserted provision

relating to the authority of the Secretary, notwithstanding subsec.

(c)(1) of this section, to establish monthly rent exceeding fair

market rental where cost levels so require or where necessary to

the implementation of a local housing assistance plan.

Subsec. (j). Pub. L. 96-399, Sec. 308(c)(3), substituted

"manufactured home" for "mobile home" wherever appearing.

1979 - Subsec. (c)(3). Pub. L. 96-153, Sec. 202(b), substituted

new provisions for computation of the amount of monthly assistance

payments with respect to dwelling units and laid down criteria to

be followed by the Secretary in regard to payments to families with

different income levels.

Subsec. (d)(1)(A). Pub. L. 96-153, Sec. 206(b)(1), substituted

"Secretary and the agency, except that the tenant selection

criteria used by the owner shall give preference to families which

occupy substandard housing or are involuntarily displaced at the

time they are seeking assistance under this section." for

"Secretary and the agency;".

Subsec. (e)(1). Pub. L. 96-153, Sec. 211(b), substituted "term of

less than two hundred and forty months" for "term of less than one

month".

Subsec. (e)(2). Pub. L. 96-153, Sec. 206(b)(2), substituted

"performance of such responsibilities), except that the tenant

selection criteria shall give preference to families which occupy

substandard housing or are involuntarily displaced at the time they

are seeking housing assistance under this section" for "performance

of such responsibilities)".

Subsec. (k). Pub. L. 96-153, Sec. 210, added subsec. (k).

1978 - Subsec. (e)(5). Pub. L. 95-557, Sec. 206(e), added par.

(5).

Subsec. (i). Pub. L. 95-557, Sec. 206(d)(1), added subsec. (i).

Subsec. (j). Pub. L. 95-557, Sec. 206(f), added subsec. (j).

1977 - Subsec. (c), Pub. L. 95-128, Sec. 201(c), (d), inserted in

par. (1) prohibition against high-rise elevator projects for

families with children after Oct. 12, 1977, and struck out from

par. (4) provision which prohibited payment after the sixty-day

period if the unoccupied unit was in a project insured under the

National Housing Act, except pursuant to section 1715z-9 of title

12.

Subsec. (d)(3). Pub. L. 95-128, Sec. 201(e)(1), added par. (3).

Subsec. (e)(1). Pub. L. 95-24 substituted "three hundred and

sixty months, except that such term may not exceed two hundred and

forty months in the case of a project financed with assistance of a

loan made by, or insured, guaranteed or intended for purchase by,

the Federal Government, other than pursuant to section 1715z-9 of

title 12" for "two hundred and forty months" and "Notwithstanding

the preceding sentence, in the case of" for "In the case of".

Subsec. (e)(2). Pub. L. 95-128, Sec. 201(e)(2), inserted

provision respecting the Secretary's approval of any public housing

agency for assumption of management and maintenance

responsibilities of dwelling units under the preceding sentence.

1976 - Subsec. (c)(4). Pub. L. 94-375, Sec. 2(d), inserted

provision extending payments to newly constructed or substantially

rehabilitated unoccupied units in an amount equal to the debt

service of such unit for a period not to exceed one year, provided

that a good faith effort is being made to fill the unit, the unit

provides decent and safe housing, the unit is not insured under the

National Housing Act, except pursuant to section 1715z-9 of title

12, and the revenues from the project do not exceed the cost.

Subsec. (e)(1). Pub. L. 94-375, Sec. 2(g), inserted "or the

Farmers' Home Administration" after "State or local agency".

Subsec. (f)(6). Pub. L. 94-375, Sec. 2(e), added par. (6).

EFFECTIVE DATE OF 2002 AMENDMENT

Amendment by Pub. L. 107-116 effective Sept. 30, 2001, see

section 603 of Pub. L. 107-116, set out as a note under section

1715n of Title 12, Banks and Banking.

EFFECTIVE DATE OF 2000 AMENDMENT

Pub. L. 106-569, title III, Sec. 301(b), Dec. 27, 2000, 114 Stat.

2952, provided that: "The amendments made by subsection (a)

[amending this section] shall take effect immediately after the

amendments made by section 555(c) of the Quality Housing and Work

Responsibility Act of 1998 [Pub. L. 105-276, set out as an

Effective Date of 1998 Amendment note below] take effect pursuant

to such section."

Pub. L. 106-569, title IX, Sec. 902(b), Dec. 27, 2000, 114 Stat.

3026, provided that: "The amendment under subsection (a) [amending

this section] shall be made and shall apply -

"(1) upon the enactment of this Act, if the Departments of

Veterans Affairs and Housing and Urban Development, and

Independent Agencies Appropriations Act, 2001 [H.R. 5482, as

enacted by section 1(a)(1) of Pub. L. 106-377], is enacted before

the enactment of this Act; and

"(2) immediately after the enactment of such appropriations

Act, if such appropriations Act is enacted after the enactment of

this Act."

Pub. L. 106-569, title IX, Sec. 903(b), Dec. 27, 2000, 114 Stat.

3026, provided that: "The amendment under subsection (a) [amending

this section] shall be made and shall apply -

"(1) upon the enactment of this Act, if the Departments of

Veterans Affairs and Housing and Urban Development, and

Independent Agencies Appropriations Act, 2001 [H.R. 5482, as

enacted by section 1(a)(1) of Pub. L. 106-377], is enacted before

the enactment of this Act; and

"(2) immediately after the enactment of such appropriations

Act, if such appropriations Act is enacted after the enactment of

this Act."

EFFECTIVE DATE OF 1998 AMENDMENT

Pub. L. 105-276, title II, Sec. 209(b), Oct. 21, 1998, 112 Stat.

2485, provided that: "This section [amending this section] shall

take effect 60 days after the later of October 1, 1998 or the date

of the enactment of this Act [Oct. 21, 1998]."

Amendment by title V of Pub. L. 105-276 effective and applicable

beginning upon Oct. 1, 1999, except as otherwise provided, with

provision that Secretary may implement amendment before such date,

except to extent that such amendment provides otherwise, and with

savings provision, see section 503 of Pub. L. 105-276, set out as a

note under section 1437 of this title.

Amendment by section 514(b)(1) of Pub. L. 105-276 effective and

applicable beginning upon Oct. 21, 1998, see section 514(g) of Pub.

L. 105-276, set out as a note under section 1701s of Title 12,

Banks and Banking.

Pub. L. 105-276, title V, Sec. 545(c), Oct. 21, 1998, 112 Stat.

2604, provided that: "Notwithstanding the amendment made by

subsection (a) of this section [amending this section], any

amendments to section 8(o) of the United States Housing Act of 1937

(42 U.S.C. 1437f(o)) that are contained in title II of this Act

[see Tables for classification] shall apply with respect to the

provision of assistance under such section during the period before

implementation (pursuant to section 559 of this title [set out as a

Regulations and Transition Provisions note below]) of such section

8(o) as amended by subsection (a) of this section."

Pub. L. 105-276, title V, Sec. 549(a)(3), Oct. 21, 1998, 112

Stat. 2607, provided that: "The amendments under this subsection

[amending this section] are made on, and shall apply beginning

upon, the date of the enactment of this Act [Oct. 21, 1998], and

shall apply thereafter, notwithstanding section 203 of the

Departments of Veterans Affairs and Housing and Urban Development,

and Independent Agencies Appropriations Act, 1996 [section 101(e)

[title II, Sec. 203] of Pub. L. 104-134, amending this section and

enacting provisions set out as an Effective and Termination Dates

of 1996 Amendments note below] (42 U.S.C. 1437f note) or any other

provision of law (including the expiration of the applicability of

such section 203 or any repeal of such section 203)."

Pub. L. 105-276, title V, Sec. 554, Oct. 21, 1998, 112 Stat.

2611, provided that: "Notwithstanding section 203(d) of the

Departments of Veterans Affairs and Housing and Urban Development,

and Independent Agencies Appropriations Act, 1996 (as contained in

section 101(e) of the Omnibus Consolidated Rescissions and

Appropriations Act of 1996 (Public Law 104-134; 42 U.S.C. 1437f

note) [see Effective and Termination Dates of 1996 Amendments note

below]), section 8 of the United States Housing Act of 1937 (42

U.S.C. 1437f) is amended by striking subsection (t). This section

shall apply beginning upon, and the amendment made by this section

is made on, and shall apply beginning upon, the date of the

enactment of this Act [Oct. 21, 1998]."

Pub. L. 105-276, title V, Sec. 555(c), Oct. 21, 1998, 112 Stat.

2613, provided that: "This section [amending this section and

enacting provisions set out as a note below] shall take effect on,

and the amendments made by this section are made on, and shall

apply beginning upon, the date of the enactment of this Act [Oct.

21, 1998]."

Amendment by section 565(c) of Pub. L. 105-276 effective and

applicable beginning upon Oct. 21, 1998, see section 565(e) of Pub.

L. 105-276, set out as a note under section 1437d of this title.

EFFECTIVE AND TERMINATION DATES OF 1996 AMENDMENTS

Section 101(e) [title II, Sec. 203(d)] of Pub. L. 104-134, as

amended by Pub. L. 104-204, title II, Sec. 201(e), Sept. 26, 1996,

110 Stat. 2893; Pub. L. 105-65, title II, Sec. 201(b), Oct. 27,

1997, 111 Stat. 1364, provided that: "The provisions of this

section [amending this section] shall be effective for fiscal years

1996, 1997, and 1998 only."

Amendment by section 402(d)(2), (3), (6)(A)(iii), (iv) of Pub. L.

104-99 effective Jan. 26, 1996, only for fiscal years 1996, 1997,

and 1998, and to cease to be effective Oct. 21, 1998, see section

402(f) of Pub. L. 104-99, as amended, and section 514(f) of Pub. L.

105-276, set out as notes under section 1437a of this title.

EFFECTIVE AND TERMINATION DATES OF 1994 AMENDMENT

Amendment by Pub. L. 103-327 enacting subsec. (aa), effective

only during fiscal year 1995, see title II in part of Pub. L.

103-327, set out as a note under section 1715n of Title 12, Banks

and Banking.

EFFECTIVE DATE OF 1992 AMENDMENT

Amendment by subtitles B through F of title VI [Secs. 621-685] of

Pub. L. 102-550 applicable upon expiration of 6-month period

beginning Oct. 28, 1992, except as otherwise provided, see section

13642 of this title.

EFFECTIVE DATE OF 1990 AMENDMENT

Amendment by section 289(b)(1) of Pub. L. 101-625, repealing

subsec. (e)(2) of this section, effective Oct. 1, 1991; however,

provisions of subsec. (e)(2) to remain in effect with respect to

single room occupancy dwellings as authorized by subchapter IV

(Sec. 11361 et seq.) of chapter 119 of this title, see section

12839(a)(4), (b) of this title.

EFFECTIVE DATE OF 1983 AMENDMENT; SAVINGS PROVISION

Section 209(b) Pub. L. 98-181 provided that: "The amendments made

by subsection (a) [amending this section] shall take effect on

October 1, 1983, except that the provisions repealed shall remain

in effect -

"(1) with respect to any funds obligated for a viable project

under section 8 of the United States Housing Act of 1937 [this

section] prior to January 1, 1984; and

"(2) with respect to any project financed under section 202 of

the Housing Act of 1959 [12 U.S.C. 1701q]."

EFFECTIVE DATE OF 1981 AMENDMENT

Amendments by sections 322(e) and 329H(a) of Pub. L. 97-35

effective Oct. 1, 1981, and amendments by sections 324, 325, and

326(a) of Pub. L. 97-35 applicable with respect to contracts

entered into on or after Oct. 1, 1981, see section 371 of Pub. L.

97-35, set out as an Effective Date note under section 3701 of

Title 12, Banks and Banking.

Section 326(e)(2) of Pub. L. 97-35 provided that: "The amendment

made by paragraph (1) [amending this section] shall apply with

respect to leases entered into on or after October 1, 1981."

EFFECTIVE DATE OF 1979 AMENDMENT

Amendment by section 202(b) of Pub. L. 96-153 effective Jan. 1,

1980, except with respect to amount of tenant contribution required

of families whose occupancy commenced prior to such date, see

section 202(c) of Pub. L. 96-153, set out as a note under section

1437a of this title.

EFFECTIVE DATE OF 1978 AMENDMENT

Section 206(d)(2) of Pub. L. 95-557 provided that: "The amendment

made by this subsection [amending this section] shall become

effective with respect to contracts entered into on or after 270

days following the date of enactment of this Act [Oct. 31, 1978]."

Amendment by section 206(e), (f) of Pub. L. 95-557 effective Oct.

1, 1978, see section 206(h) of Pub. L. 95-557, set out as a note

under section 1437c of this title.

EFFECTIVE DATE

Section effective not later than Jan. 1, 1975, see section 201(b)

of Pub. L. 93-383, set out as a note under section 1437 of this

title.

APPLICABILITY OF 1994 AMENDMENTS

Title II of Pub. L. 103-327, 108 Stat. 2315, third par., provided

that: "The immediately foregoing amendment [amending subsec.

(c)(2)(A) of this section by authorizing modification of rent

adjustment where adjusted rent exceeds fair market rental] shall

apply to all contracts for new construction, substantial

rehabilitation, and moderate rehabilitation projects under which

rents are adjusted under section 8(c)(2)(A) of such Act [subsec.

(c)(2)(A) of this section] by applying an annual adjustment

factor."

Title II of Pub. L. 103-327, 108 Stat. 2315, fifth par., provided

that: "The immediately foregoing [amending subsec. (c)(2)(A) of

this section by inserting two sentences at end authorizing

reduction of annual adjustment factor in certain circumstances]

shall hereafter apply to all contracts that are subject to section

8(c)(2)(A) of such Act [subsec. (c)(2)(A) of this section] and that

provide for rent adjustments using an annual adjustment factor."

REGULATIONS AND TRANSITION PROVISIONS

Pub. L. 105-276, title V, Sec. 559, Oct. 21, 1998, 112 Stat.

2615, provided that:

"(a) Interim Regulations. - The Secretary of Housing and Urban

Development shall issue such interim regulations as may be

necessary to implement the amendments made by this subtitle

[subtitle C (Secs. 545-559) of title V of Pub. L. 105-276, see

Tables for classification] and other provisions in this title [see

Tables for classification] which relate to section 8(o) of the

United States Housing Act of 1937 [42 U.S.C. 1437f(o)].

"(b) Final Regulations. - The Secretary shall issue final

regulations necessary to implement the amendments made by this

subtitle and other provisions in this title which relate to section

8(o) of the United States Housing Act of 1937 [42 U.S.C. 1437f(o)]

not later then 1 year after the date of the enactment of this Act

[Oct. 21, 1998].

"(c) Factors For Consideration. - Before the publication of the

final regulations under subsection (b), in addition to public

comments invited in connection with the publication of the interim

rule, the Secretary shall -

"(1) seek recommendations on the implementation of sections

8(o)(6)(B), 8(o)(7)(B), and 8(o)(10)(D) of the United States

Housing Act of 1937 [42 U.S.C. 1437f(o)(6)(B), (7)(B), (10)(D)]

and of renewals of expiring tenant-based assistance from

organizations representing -

"(A) State or local public housing agencies;

"(B) owners and managers of tenant-based housing assisted

under section 8 of the United States Housing Act of 1937;

"(C) families receiving tenant-based assistance under section

8 of the United States Housing Act of 1937; and

"(D) legal service organizations; and

"(2) convene not less than 2 public forums at which the persons

or organizations making recommendations under paragraph (1) may

express views concerning the proposed disposition of the

recommendations.

"(d) Conversion Assistance. -

"(1) In general. - The Secretary may provide for the conversion

of assistance under the certificate and voucher programs under

subsections (b) and (o) of section 8 of the United States Housing

Act of 1937 [42 U.S.C. 1437f(b), (o)], as in effect before the

applicability of the amendments made by this subtitle, to the

voucher program established by the amendments made by this

subtitle.

"(2) Continued applicability. - The Secretary may apply the

provisions of the United States Housing Act of 1937 [42 U.S.C.

1437 et seq.], or any other provision of law amended by this

subtitle, as those provisions were in effect immediately before

the date of the enactment of this Act [Oct. 21, 1998] (except

that such provisions shall be subject to any amendments to such

provisions that may be contained in title II of this Act [see

Tables for classification]), to assistance obligated by the

Secretary before October 1, 1999, for the certificate or voucher

program under section 8 of the United States Housing Act of 1937

[42 U.S.C. 1437f], if the Secretary determines that such action

is necessary for simplification of program administration,

avoidance of hardship, or other good cause.

"(e) Effective Date. - This section shall take effect on the date

of the enactment of this Act [Oct. 21, 1998]."

REGULATIONS

Pub. L. 105-276, title V, Sec. 556(b), Oct. 21, 1998, 112 Stat.

2613, provided that: "The Secretary of Housing and Urban

Development shall implement the provision added by the amendment

made by subsection (a) [amending this section] through notice, not

later than December 31, 1998, and shall issue final regulations

which shall be developed pursuant to the procedures for issuance of

regulations under the negotiated rulemaking procedure under

subchapter III of chapter 5 of title 5, United States Code, not

later than one year after the date of the enactment of this Act

[Oct. 21, 1998]."

For provisions requiring Secretary of Housing and Urban

Development to issue regulations necessary to implement amendment

to this section by Pub. L. 103-233, see section 101(f) of Pub. L.

103-233, set out as a note under section 1701z-11 of Title 12,

Banks and Banking.

For provision requiring that not later than expiration of the

180-day period beginning Oct. 28, 1992, the Secretary of Housing

and Urban Development shall issue regulations implementing

amendments to this section by section 545 of Pub. L. 101-625, see

section 104 of Pub. L. 102-550, set out as a note under section

1437d of this title.

Section 149 of Pub. L. 102-550 provided that: "The Secretary of

Housing and Urban Development shall issue any final regulations

necessary to carry out the amendments made by section 547 of the

Cranston-Gonzalez National Affordable Housing Act [Pub. L. 101-625,

amending this section] not later than the expiration of the 180-day

period beginning on the date of the enactment of this Act [Oct. 28,

1992]. The regulations shall be issued after notice and opportunity

for public comment pursuant to the provisions of section 553 of

title 5, United States Code (notwithstanding subsections (a)(2),

(b)(B), and (d)(3) of such section) and shall take effect upon the

expiration of the 30-day period beginning upon issuance."

Section 151 of Pub. L. 102-550 provided that: "The Secretary of

Housing and Urban Development shall issue any final regulations

necessary to carry out the provisions of section 555 of the

Cranston-Gonzalez National Affordable Housing Act [Pub. L. 101-625]

(42 U.S.C. 1437f note) not later than the expiration of the 180-day

period beginning on the date of the enactment of this Act [Oct. 28,

1992]. The regulations shall be issued after notice and opportunity

for public comment pursuant to the provisions of section 553 of

title 5, United States Code (notwithstanding subsections (a)(2),

(b)(B), and (d)(3) of such section) and shall take effect upon the

expiration of the 30-day period beginning upon issuance."

SAVINGS PROVISION

Pub. L. 106-377, Sec. 1(a)(1) [title II, Sec. 232(b)], Oct. 27,

2000, 114 Stat. 1441, 1441A-34, provided that: "In the case of any

dwelling unit that, upon the date of the enactment of this Act

[Oct. 27, 2000], is assisted under a housing assistance payment

contract under section 8(o)(13) of the United States Housing Act of

1937 (42 U.S.C. 1437f(o)(13)) as in effect before such enactment,

such assistance may be extended or renewed notwithstanding the

requirements under subparagraphs (C), (D), and (E) of such section

8(o)(13), as amended by subsection (a)."

PURPOSES OF MARK-TO-MARKET EXTENSION ACT OF 2001

Pub. L. 107-116, title VI, Sec. 602, Jan. 10, 2002, 115 Stat.

2221, provided that: "The purposes of this title [see Short Title

of 2002 Amendment note set out under section 1437 of this title]

are -

"(1) to continue the progress of the Multifamily Assisted

Housing Reform and Affordability Act of 1997 [title V of Pub. L.

105-65, see Short Title of 1997 Amendment note set out under

section 1701 of Title 12, Banks and Banking] (referred to in this

section as 'that Act');

"(2) to ensure that properties that undergo mortgage

restructurings pursuant to that Act are rehabilitated to a

standard that allows the properties to meet their long-term

affordability requirements;

"(3) to ensure that, for properties that undergo mortgage

restructurings pursuant to that Act, reserves are set at adequate

levels to allow the properties to meet their long-term

affordability requirements;

"(4) to ensure that properties that undergo mortgage

restructurings pursuant to that Act are operated efficiently, and

that operating expenses are sufficient to ensure the long-term

financial and physical integrity of the properties;

"(5) to ensure that properties that undergo rent restructurings

have adequate resources to maintain the properties in good

condition;

"(6) to ensure that the Office of Multifamily Housing

Assistance Restructuring of the Department of Housing and Urban

Development continues to focus on the portfolio of properties

eligible for restructuring under that Act;

"(7) to ensure that the Department of Housing and Urban

Development carefully tracks the condition of those properties on

an ongoing basis;

"(8) to ensure that tenant groups, nonprofit organizations, and

public entities continue to have the resources for building the

capacity of tenant organizations in furtherance of the purposes

of subtitle A of that Act [subtitle A of title V of Pub. L.

105-65, set out in a note below]; and

"(9) to encourage the Office of Multifamily Housing Assistance

Restructuring to continue to provide participating administrative

entities, including public participating administrative entities,

with the flexibility to respond to specific problems that

individual cases may present, while ensuring consistent outcomes

around the country."

PILOT PROGRAM FOR HOMEOWNERSHIP ASSISTANCE FOR DISABLED FAMILIES

Pub. L. 106-569, title III, Sec. 302, Dec. 27, 2000, 114 Stat.

2953, provided that:

"(a) In General. - A public housing agency providing tenant-based

assistance on behalf of an eligible family under section 8 of the

United States Housing Act of 1937 (42 U.S.C. 1437f) may provide

assistance for a disabled family that purchases a dwelling unit

(including a dwelling unit under a lease-purchase agreement) that

will be owned by one or more members of the disabled family and

will be occupied by the disabled family, if the disabled family -

"(1) purchases the dwelling unit before the expiration of the

3-year period beginning on the date that the Secretary first

implements the pilot program under this section;

"(2) demonstrates that the disabled family has income from

employment or other sources (including public assistance), as

determined in accordance with requirements of the Secretary, that

is not less than twice the payment standard established by the

public housing agency (or such other amount as may be established

by the Secretary);

"(3) except as provided by the Secretary, demonstrates at the

time the disabled family initially receives tenant-based

assistance under this section that one or more adult members of

the disabled family have achieved employment for the period as

the Secretary shall require;

"(4) participates in a homeownership and housing counseling

program provided by the agency; and

"(5) meets any other initial or continuing requirements

established by the public housing agency in accordance with

requirements established by the Secretary.

"(b) Determination of Amount of Assistance. -

"(1) In general. -

"(A) Monthly expenses not exceeding payment standard. - If

the monthly homeownership expenses, as determined in accordance

with requirements established by the Secretary, do not exceed

the payment standard, the monthly assistance payment shall be

the amount by which the homeownership expenses exceed the

highest of the following amounts, rounded to the nearest

dollar:

"(i) Thirty percent of the monthly adjusted income of the

disabled family.

"(ii) Ten percent of the monthly income of the disabled

family.

"(iii) If the disabled family is receiving payments for

welfare assistance from a public agency, and a portion of

those payments, adjusted in accordance with the actual

housing costs of the disabled family, is specifically

designated by that agency to meet the housing costs of the

disabled family, the portion of those payments that is so

designated.

"(B) Monthly expenses exceed payment standard. - If the

monthly homeownership expenses, as determined in accordance

with requirements established by the Secretary, exceed the

payment standard, the monthly assistance payment shall be the

amount by which the applicable payment standard exceeds the

highest of the amounts under clauses (i), (ii), and (iii) of

subparagraph (A).

"(2) Calculation of amount. -

"(A) Low-income families. - A disabled family that is a

low-income family shall be eligible to receive 100 percent of

the amount calculated under paragraph (1).

"(B) Income between 81 and 89 percent of median. - A disabled

family whose income is between 81 and 89 percent of the median

for the area shall be eligible to receive 66 percent of the

amount calculated under paragraph (1).

"(C) Income between 90 and 99 percent of median. - A disabled

family whose income is between 90 and 99 percent of the median

for the area shall be eligible to receive 33 percent of the

amount calculated under paragraph (1).

"(D) Income more than 99 percent of median. - A disabled

family whose income is more than 99 percent of the median for

the area shall not be eligible to receive assistance under this

section.

"(c) Inspections and Contract Conditions. -

"(1) In general. - Each contract for the purchase of a dwelling

unit to be assisted under this section shall -

"(A) provide for pre-purchase inspection of the dwelling unit

by an independent professional; and

"(B) require that any cost of necessary repairs be paid by

the seller.

"(2) Annual inspections not required. - The requirement under

subsection (o)(8)(A)(ii) of section 8 of the United States

Housing Act of 1937 [42 U.S.C. 1437f(o)(8)(A)(ii)] for annual

inspections shall not apply to dwelling units assisted under this

section.

"(d) Other Authority of the Secretary. - The Secretary may -

"(1) limit the term of assistance for a disabled family

assisted under this section;

"(2) provide assistance for a disabled family for the entire

term of a mortgage for a dwelling unit if the disabled family

remains eligible for such assistance for such term; and

"(3) modify the requirements of this section as the Secretary

determines to be necessary to make appropriate adaptations for

lease-purchase agreements.

"(e) Assistance Payments Sent to Lender. - The Secretary shall

remit assistance payments under this section directly to the

mortgagee of the dwelling unit purchased by the disabled family

receiving such assistance payments.

"(f) Inapplicability of Certain Provisions. - Assistance under

this section shall not be subject to the requirements of the

following provisions:

"(1) Subsection (c)(3)(B) of section 8 of the United States

Housing Act of 1937 [42 U.S.C. 1437f(c)(3)(B)].

"(2) Subsection (d)(1)(B)(i) of section 8 of the United States

Housing Act of 1937.

"(3) Any other provisions of section 8 of the United States

Housing Act of 1937 governing maximum amounts payable to owners

and amounts payable by assisted families.

"(4) Any other provisions of section 8 of the United States

Housing Act of 1937 concerning contracts between public housing

agencies and owners.

"(5) Any other provisions of the United States Housing Act of

1937 [42 U.S.C. 1437 et seq.] that are inconsistent with the

provisions of this section.

"(g) Reversion to Rental Status. -

"(1) Non-fha mortgages. - If a disabled family receiving

assistance under this section defaults under a mortgage not

insured under the National Housing Act [12 U.S.C. 1701 et seq.],

the disabled family may not continue to receive rental assistance

under section 8 of the United States Housing Act of 1937 [42

U.S.C. 1437f] unless it complies with requirements established by

the Secretary.

"(2) All mortgages. - A disabled family receiving assistance

under this section that defaults under a mortgage may not receive

assistance under this section for occupancy of another dwelling

unit owned by one or more members of the disabled family.

"(3) Exception. - This subsection shall not apply if the

Secretary determines that the disabled family receiving

assistance under this section defaulted under a mortgage due to

catastrophic medical reasons or due to the impact of a federally

declared major disaster or emergency.

"(h) Regulations. - Not later than 90 days after the date of the

enactment of this Act [Dec. 27, 2000], the Secretary shall issue

regulations to implement this section. Such regulations may not

prohibit any public housing agency providing tenant-based

assistance on behalf of an eligible family under section 8 of the

United States Housing Act of 1937 [42 U.S.C. 1437f] from

participating in the pilot program under this section.

"(i) Definition of Disabled Family. - For the purposes of this

section, the term 'disabled family' has the meaning given the term

'person with disabilities' in section 811(k)(2) of the

Cranston-Gonzalez National Affordable Housing Act (42 U.S.C.

8013(k)(2))."

DETERMINATION OF ADMINISTRATIVE FEES

Pub. L. 107-73, title II, Nov. 26, 2001, 115 Stat. 660, provided

in part: "That the fee otherwise authorized under section 8(q) of

the Act [42 U.S.C. 1437f(q)] shall be determined in accordance with

section 8(q), as in effect immediately before the enactment of the

Quality Housing and Work Responsibility Act of 1998 [Pub. L.

105-276]".

Similar provisions were contained in the following appropriation

act:

Pub. L. 106-377, Sec. 1(a)(1) [title II], Oct. 27, 2000, 114

Stat. 1441, 1441A-12.

Pub. L. 106-74, title II, Oct. 20, 1999, 113 Stat. 1056.

HOMEOWNERSHIP OPPORTUNITIES DEMONSTRATION PROGRAM

Pub. L. 105-276, title V, Sec. 555(b), Oct. 21, 1998, 112 Stat.

2613, provided that:

"(1) In general. - With the consent of the affected public

housing agencies, the Secretary may carry out (or contract with 1

or more entities to carry out) a demonstration program under

section 8(y) of the United States Housing Act of 1937 (42 U.S.C.

1437f(y)) to expand homeownership opportunities for low-income

families.

"(2) Report. - The Secretary shall report annually to Congress on

activities conducted under this subsection."

MULTIFAMILY HOUSING ASSISTANCE

Subtitles A (Secs. 511-524) and D (Secs. 571-579) of title V of

Pub. L. 105-65, as amended by Pub. L. 105-276, title V, Secs.

549(c), 597(b), Oct. 21, 1998, 112 Stat. 2608, 2659; Pub. L.

106-74, title II, Secs. 213(b), 219, title V, Secs. 531(a)-(c),

534, 538(b), Oct. 20, 1999, 113 Stat. 1074, 1075, 1109-1116, 1120,

1123; Pub. L. 106-400, Sec. 2, Oct. 30, 2000, 114 Stat. 1675; Pub.

L. 107-116, title VI, Secs. 611-614, 616(a)(1), (b), 621, 622(a),

623(a), 624, 625, Jan. 10, 2002, 115 Stat. 2222-2227, provided

that:

"SUBTITLE A - FHA-INSURED MULTIFAMILY HOUSING MORTGAGE AND HOUSING

ASSISTANCE RESTRUCTURING

"SEC. 511. FINDINGS AND PURPOSES.

"(a) Findings. - Congress finds that -

"(1) there exists throughout the Nation a need for decent,

safe, and affordable housing;

"(2) as of the date of enactment of this Act [Oct. 27, 1997],

it is estimated that -

"(A) the insured multifamily housing portfolio of the Federal

Housing Administration consists of 14,000 rental properties,

with an aggregate unpaid principal mortgage balance of

$38,000,000,000; and

"(B) approximately 10,000 of these properties contain housing

units that are assisted with project-based rental assistance

under section 8 of the United States Housing Act of 1937 [42

U.S.C. 1437f];

"(3) FHA-insured multifamily rental properties are a major

Federal investment, providing affordable rental housing to an

estimated 2,000,000 low- and very low-income families;

"(4) approximately 1,600,000 of these families live in dwelling

units that are assisted with project-based rental assistance

under section 8 of the United States Housing Act of 1937;

"(5) a substantial number of housing units receiving

project-based assistance have rents that are higher than the

rents of comparable, unassisted rental units in the same housing

rental market;

"(6) many of the contracts for project-based assistance will

expire during the several years following the date of enactment

of this Act;

"(7) it is estimated that -

"(A) if no changes in the terms and conditions of the

contracts for project-based assistance are made before fiscal

year 2000, the cost of renewing all expiring rental assistance

contracts under section 8 of the United States Housing Act of

1937 for both project-based and tenant-based rental assistance

will increase from approximately $3,600,000,000 in fiscal year

1997 to over $14,300,000,000 by fiscal year 2000 and some

$22,400,000,000 in fiscal year 2006;

"(B) of those renewal amounts, the cost of renewing

project-based assistance will increase from $1,200,000,000 in

fiscal year 1997 to almost $7,400,000,000 by fiscal year 2006;

and

"(C) without changes in the manner in which project-based

rental assistance is provided, renewals of expiring contracts

for project-based rental assistance will require an

increasingly larger portion of the discretionary budget

authority of the Department of Housing and Urban Development in

each subsequent fiscal year for the foreseeable future;

"(8) absent new budget authority for the renewal of expiring

rental contracts for project-based assistance, many of the

FHA-insured multifamily housing projects that are assisted with

project-based assistance are likely to default on their

FHA-insured mortgage payments, resulting in substantial claims to

the FHA General Insurance Fund and Special Risk Insurance Fund;

"(9) more than 15 percent of federally assisted multifamily

housing projects are physically or financially distressed,

including a number which suffer from mismanagement;

"(10) due to Federal budget constraints, the downsizing of the

Department of Housing and Urban Development, and diminished

administrative capacity, the Department lacks the ability to

ensure the continued economic and physical well-being of the

stock of federally insured and assisted multifamily housing

projects;

"(11) the economic, physical, and management problems facing

the stock of federally insured and assisted multifamily housing

projects will be best served by reforms that -

"(A) reduce the cost of Federal rental assistance, including

project-based assistance, to these projects by reducing the

debt service and operating costs of these projects while

retaining the low-income affordability and availability of this

housing;

"(B) address physical and economic distress of this housing

and the failure of some project managers and owners of projects

to comply with management and ownership rules and requirements;

and

"(C) transfer and share many of the loan and contract

administration functions and responsibilities of the Secretary

to and with capable State, local, and other entities; and

"(12) the authority and duties of the Secretary, not including

the control by the Secretary of applicable accounts in the

Treasury of the United States, may be delegated to State, local

or other entities at the discretion of the Secretary, to the

extent the Secretary determines, and for the purpose of carrying

out this title [see Short Title of 1997 Amendment note set out

under section 1701 of Title 12, Banks and Banking], so that the

Secretary has the discretion to be relieved of processing and

approving any document or action required by these reforms.

"(b) Purposes. - Consistent with the purposes and requirements of

the Government Performance and Results Act of 1993 [Pub. L. 103-62,

see Short Title of 1993 Amendment note set out under section 1101

of Title 31, Money and Finance], the purposes of this subtitle are

-

"(1) to preserve low-income rental housing affordability and

availability while reducing the long-term costs of project-based

assistance;

"(2) to reform the design and operation of Federal rental

housing assistance programs, administered by the Secretary, to

promote greater multifamily housing project operating and cost

efficiencies;

"(3) to encourage owners of eligible multifamily housing

projects to restructure their FHA-insured mortgages and

project-based assistance contracts in a manner that is consistent

with this subtitle before the year in which the contract expires;

"(4) to reduce the cost of insurance claims under the National

Housing Act [12 U.S.C. 1701 et seq.] related to mortgages insured

by the Secretary and used to finance eligible multifamily housing

projects;

"(5) to streamline and improve federally insured and assisted

multifamily housing project oversight and administration;

"(6) to resolve the problems affecting financially and

physically troubled federally insured and assisted multifamily

housing projects through cooperation with residents, owners,

State and local governments, and other interested entities and

individuals;

"(7) to protect the interest of project owners and managers,

because they are partners of the Federal Government in meeting

the affordable housing needs of the Nation through the section 8

rental housing assistance program;

"(8) to protect the interest of tenants residing in the

multifamily housing projects at the time of the restructuring for

the housing; and

"(9) to grant additional enforcement tools to use against those

who violate agreements and program requirements, in order to

ensure that the public interest is safeguarded and that Federal

multifamily housing programs serve their intended purposes.

"SEC. 512. DEFINITIONS.

"In this subtitle:

"(1) Comparable properties. - The term 'comparable properties'

means properties in the same market areas, where practicable,

that -

"(A) are similar to the eligible multifamily housing project

as to neighborhood (including risk of crime), type of location,

access, street appeal, age, property size, apartment mix,

physical configuration, property and unit amenities, utilities,

and other relevant characteristics; and

"(B) are not receiving project-based assistance.

"(2) Eligible multifamily housing project. - The term 'eligible

multifamily housing project' means a property consisting of more

than 4 dwelling units -

"(A) with rents that, on an average per unit or per room

basis, exceed the rent of comparable properties in the same

market area, determined in accordance with guidelines

established by the Secretary;

"(B) that is covered in whole or in part by a contract for

project-based assistance under -

"(i) the new construction or substantial rehabilitation

program under section 8(b)(2) of the United States Housing

Act of 1937 [42 U.S.C. 1437f(b)(2)] (as in effect before

October 1, 1983);

"(ii) the property disposition program under section 8(b)

of the United States Housing Act of 1937;

"(iii) the moderate rehabilitation program under section

8(e)(2) of the United States Housing Act of 1937;

"(iv) the loan management assistance program under section

8 of the United States Housing Act of 1937;

"(v) section 23 of the United States Housing Act of 1937

[42 U.S.C. 1437u] (as in effect before January 1, 1975);

"(vi) the rent supplement program under section 101 of the

Housing and Urban Development Act of 1965 [12 U.S.C. 1701s];

or

"(vii) section 8 of the United States Housing Act of 1937,

following conversion from assistance under section 101 of the

Housing and Urban Development Act of 1965; and

"(C) financed by a mortgage insured or held by the Secretary

under the National Housing Act [12 U.S.C. 1701 et seq.].

Such term does not include any project with an expiring contract

described in paragraph (1) or (2) of section 524(e), but does

include a project described in section 524(e)(3). Notwithstanding

any other provision of this title, the Secretary may treat a

project as an eligible multifamily housing project for purposes

of this title if (I) the project is assisted pursuant to a

contract for project-based assistance under section 8 of the

United States Housing Act of 1937 renewed under section 524 of

this Act, (II) the owner consents to such treatment, and (III)

the project met the requirements of the first sentence of this

paragraph for eligibility as an eligible multifamily housing

project before the initial renewal of the contract under section

524.

"(3) Expiring contract. - The term 'expiring contract' means a

project-based assistance contract attached to an eligible

multifamily housing project which, under the terms of the

contract, will expire.

"(4) Expiration date. - The term 'expiration date' means the

date on which an expiring contract expires.

"(5) Fair market rent. - The term 'fair market rent' means the

fair market rental established under section 8(c) of the United

States Housing Act of 1937.

"(6) Low-income families. - The term 'low-income families' has

the same meaning as provided under section 3(b)(2) of the United

States Housing Act of 1937 [42 U.S.C. 1437a(b)(2)].

"(7) Mortgage restructuring and rental assistance sufficiency

plan. - The term 'mortgage restructuring and rental assistance

sufficiency plan' means the plan as provided under section 514.

"(8) Nonprofit organization. - The term 'nonprofit

organization' means any private nonprofit organization that -

"(A) is organized under State or local laws;

"(B) has no part of its net earnings inuring to the benefit

of any member, founder, contributor, or individual; and

"(C) has a long-term record of service in providing or

financing quality affordable housing for low-income families

through relationships with public entities.

"(9) Portfolio restructuring agreement. - The term 'portfolio

restructuring agreement' means the agreement entered into between

the Secretary and a participating administrative entity, as

provided under section 513.

"(10) Participating administrative entity. - The term

'participating administrative entity' means a public agency

(including a State housing finance agency or a local housing

agency), a nonprofit organization, or any other entity (including

a law firm or an accounting firm) or a combination of such

entities, that meets the requirements under section 513(b).

"(11) Project-based assistance. - The term 'project-based

assistance' means rental assistance described in paragraph (2)(B)

of this section that is attached to a multifamily housing

project.

"(12) Renewal. - The term 'renewal' means the replacement of an

expiring Federal rental contract with a new contract under

section 8 of the United States Housing Act of 1937, consistent

with the requirements of this subtitle.

"(13) Secretary. - The term 'Secretary' means the Secretary of

Housing and Urban Development.

"(14) State. - The term 'State' has the same meaning as in

section 104 of the Cranston-Gonzalez National Affordable Housing

Act [42 U.S.C. 12704].

"(15) Tenant-based assistance. - The term 'tenant-based

assistance' has the same meaning as in section 8(f) of the United

States Housing Act of 1937.

"(16) Unit of general local government. - The term 'unit of

general local government' has the same meaning as in section 104

of the Cranston-Gonzalez National Affordable Housing Act.

"(17) Very low-income family. - The term 'very low-income

family' has the same meaning as in section 3(b) of the United

States Housing Act of 1937 [42 U.S.C. 1437a(b)].

"(18) Qualified mortgagee. - The term 'qualified mortgagee'

means an entity approved by the Secretary that is capable of

servicing, as well as originating, FHA-insured mortgages, and

that -

"(A) is not suspended or debarred by the Secretary;

"(B) is not suspended or on probation imposed by the

Mortgagee Review Board; and

"(C) is not in default under any Government National Mortgage

Association obligation.

"(19) Office. - The term 'Office' means the Office of

Multifamily Housing Assistance Restructuring established under

section 571.

"SEC. 513. AUTHORITY OF PARTICIPATING ADMINISTRATIVE ENTITIES.

"(a) Participating Administrative Entities. -

"(1) In general. - Subject to subsection (b)(3), the Secretary

shall enter into portfolio restructuring agreements with

participating administrative entities for the implementation of

mortgage restructuring and rental assistance sufficiency plans to

restructure multifamily housing mortgages insured or held by the

Secretary under the National Housing Act [12 U.S.C. 1701 et

seq.], in order to -

"(A) reduce the costs of expiring contracts for assistance

under section 8 of the United States Housing Act of 1937 [42

U.S.C. 1437f];

"(B) address financially and physically troubled projects;

and

"(C) correct management and ownership deficiencies.

"(2) Portfolio restructuring agreements. - Each portfolio

restructuring agreement entered into under this subsection shall

-

"(A) be a cooperative agreement to establish the obligations

and requirements between the Secretary and the participating

administrative entity;

"(B) identify the eligible multifamily housing projects or

groups of projects for which the participating administrative

entity is responsible for assisting in developing and

implementing approved mortgage restructuring and rental

assistance sufficiency plans under section 514;

"(C) require the participating administrative entity to

review and certify to the accuracy and completeness of the

evaluation of rehabilitation needs required under section

514(e)(3) for each eligible multifamily housing project

included in the portfolio restructuring agreement, in

accordance with regulations promulgated by the Secretary;

"(D) identify the responsibilities of both the participating

administrative entity and the Secretary in implementing a

mortgage restructuring and rental assistance sufficiency plan,

including any actions proposed to be taken under section 516 or

517;

"(E) require each mortgage restructuring and rental

assistance sufficiency plan to be prepared in accordance with

the requirements of section 514 for each eligible multifamily

housing project;

"(F) include other requirements established by the Secretary,

including a right of the Secretary to terminate the contract

immediately for failure of the participating administrative

entity to comply with any applicable requirement;

"(G) if the participating administrative entity is a State

housing finance agency or a local housing agency, indemnify the

participating administrative entity against lawsuits and

penalties for actions taken pursuant to the agreement,

excluding actions involving willful misconduct or negligence;

"(H) include compensation for all reasonable expenses

incurred by the participating administrative entity necessary

to perform its duties under this subtitle; and

"(I) include, where appropriate, incentive agreements with

the participating administrative entity to reward superior

performance in meeting the purposes of this title.

"(b) Selection of Participating Administrative Entity. -

"(1) Selection criteria. - The Secretary shall select a

participating administrative entity based on whether, in the

determination of the Secretary, the participating administrative

entity -

"(A) has demonstrated experience in working directly with

residents of low-income housing projects and with tenants and

other community-based organizations;

"(B) has demonstrated experience with and capacity for

multifamily restructuring and multifamily financing (which may

include risk-sharing arrangements and restructuring eligible

multifamily housing properties under the fiscal year 1997

Federal Housing Administration multifamily housing

demonstration program);

"(C) has a history of stable, financially sound, and

responsible administrative performance (which may include the

management of affordable low-income rental housing);

"(D) has demonstrated financial strength in terms of asset

quality, capital adequacy, and liquidity;

"(E) has demonstrated that it will carry out the specific

transactions and other responsibilities under this subtitle in

a timely, efficient, and cost-effective manner; and

"(F) meets other criteria, as determined by the Secretary.

"(2) Selection. - If more than 1 interested entity meets the

qualifications and selection criteria for a participating

administrative entity, the Secretary may select the entity that

demonstrates, as determined by the Secretary, that it will -

"(A) provide the most timely, efficient, and cost-effective -

"(i) restructuring of the mortgages covered by the

portfolio restructuring agreement; and

"(ii) administration of the section 8 project-based

assistance contract, if applicable; and

"(B) protect the public interest (including the long-term

provision of decent low-income affordable rental housing and

protection of residents, communities, and the American

taxpayer).

"(3) Partnerships. - For the purposes of any participating

administrative entity applying under this subsection,

participating administrative entities are encouraged to develop

partnerships with each other and with nonprofit organizations, if

such partnerships will further the participating administrative

entity's ability to meet the purposes of this title.

"(4) Alternative administrators. - With respect to any eligible

multifamily housing project for which a participating

administrative entity is unavailable, or should not be selected

to carry out the requirements of this subtitle with respect to

that multifamily housing project for reasons relating to the

selection criteria under paragraph (1), the Secretary shall -

"(A) carry out the requirements of this subtitle with respect

to that eligible multifamily housing project; or

"(B) contract with other qualified entities that meet the

requirements of paragraph (1) to provide the authority to carry

out all or a portion of the requirements of this subtitle with

respect to that eligible multifamily housing project.

"(5) Priority for public agencies as participating

administrative entities. - The Secretary shall provide a

reasonable period during which the Secretary will consider

proposals only from State housing finance agencies or local

housing agencies, and the Secretary shall select such an agency

without considering other applicants if the Secretary determines

that the agency is qualified. The period shall be of sufficient

duration for the Secretary to determine whether any State housing

finance agencies or local housing agencies are interested and

qualified. Not later than the end of the period, the Secretary

shall notify the State housing finance agency or the local

housing agency regarding the status of the proposal and, if the

proposal is rejected, the reasons for the rejection and an

opportunity for the applicant to respond.

"(6) State and local portfolio requirements. -

"(A) In general. - If the housing finance agency of a State

is selected as the participating administrative entity, that

agency shall be responsible for such eligible multifamily

housing projects in that State as may be agreed upon by the

participating administrative entity and the Secretary. If a

local housing agency is selected as the participating

administrative entity, that agency shall be responsible for

such eligible multifamily housing projects in the jurisdiction

of the agency as may be agreed upon by the participating

administrative entity and the Secretary.

"(B) Nondelegation. - Except with the prior approval of the

Secretary, a participating administrative entity may not

delegate or transfer responsibilities and functions under this

subtitle to 1 or more entities.

"(7) Private entity requirements. -

"(A) In general. - If a for-profit entity is selected as the

participating administrative entity, that entity shall be

required to enter into a partnership with a public purpose

entity (including the Department).

"(B) Prohibition. - No private entity shall share,

participate in, or otherwise benefit from any equity created,

received, or restructured as a result of the portfolio

restructuring agreement.

"SEC. 514. MORTGAGE RESTRUCTURING AND RENTAL ASSISTANCE

SUFFICIENCY PLAN.

"(a) In General. -

"(1) Development of procedures and requirements. - The

Secretary shall develop procedures and requirements for the

submission of a mortgage restructuring and rental assistance

sufficiency plan for each eligible multifamily housing project

with an expiring contract.

"(2) Terms and conditions. - Each mortgage restructuring and

rental assistance sufficiency plan submitted under this

subsection shall be developed by the participating administrative

entity, in cooperation with an owner of an eligible multifamily

housing project and any servicer for the mortgage that is a

qualified mortgagee, under such terms and conditions as the

Secretary shall require.

"(3) Consolidation. - Mortgage restructuring and rental

assistance sufficiency plans submitted under this subsection may

be consolidated as part of an overall strategy for more than 1

property.

"(b) Notice Requirements. - The Secretary shall establish notice

procedures and hearing requirements for tenants and owners

concerning the dates for the expiration of project-based assistance

contracts for any eligible multifamily housing project.

"(c) Extension of Contract Term. - Subject to agreement by a

project owner, the Secretary may extend the term of any expiring

contract or provide a section 8 contract with rent levels set in

accordance with subsection (g) for a period sufficient to

facilitate the implementation of a mortgage restructuring and

rental assistance sufficiency plan, as determined by the Secretary.

"(d) Tenant Rent Protection. - If the owner of a project with an

expiring Federal rental assistance contract does not agree to

extend the contract, not less than 12 months prior to terminating

the contract, the project owner shall provide written notice to the

Secretary and the tenants and the Secretary shall make tenant-based

assistance available to tenants residing in units assisted under

the expiring contract at the time of expiration. In addition, if

after giving the notice required in the first sentence, an owner

determines to terminate a contract, an owner shall provide an

additional written notice with respect to the termination, in a

form prescribed by the Secretary, not less than 120 days prior to

the termination. In the event the owner does not provide the

120-day notice required in the preceding sentence, the owner may

not evict the tenants or increase the tenants' rent payment until

such time as the owner has provided the 120-day notice and such

period has elapsed. The Secretary may allow the owner to renew the

terminating contract for a period of time sufficient to give

tenants 120 days of advance notice in accordance with section 524

of this Act.

"(e) Mortgage Restructuring and Rental Assistance Sufficiency

Plan. - Each mortgage restructuring and rental assistance

sufficiency plan shall -

"(1) except as otherwise provided, restructure the

project-based assistance rents for the eligible multifamily

housing project in a manner consistent with subsection (g), or

provide for tenant-based assistance in accordance with section

515;

"(2) allow for rent adjustments by applying an operating cost

adjustment factor established under guidelines established by the

Secretary;

"(3) require the owner or purchaser of an eligible multifamily

housing project to evaluate the rehabilitation needs of the

project, in accordance with regulations of the Secretary, and

notify the participating administrative entity of the

rehabilitation needs;

"(4) require the owner or purchaser of the project to provide

or contract for competent management of the project;

"(5) require the owner or purchaser of the project to take such

actions as may be necessary to rehabilitate, maintain adequate

reserves, and to maintain the project in decent and safe

condition, based on housing quality standards established by -

"(A) the Secretary; or

"(B) local housing codes or codes adopted by public housing

agencies that -

"(i) meet or exceed housing quality standards established

by the Secretary; and

"(ii) do not severely restrict housing choice;

"(6) require the owner or purchaser of the project to maintain

affordability and use restrictions in accordance with regulations

promulgated by the Secretary, for a term of not less than 30

years which restrictions shall be -

"(A) contained in a legally enforceable document recorded in

the appropriate records; and

"(B) consistent with the long-term physical and financial

viability and character of the project as affordable housing;

"(7) include a certification by the participating

administrative entity that the restructuring meets subsidy

layering requirements established by the Secretary by regulation

for purposes of this subtitle;

"(8) require the owner or purchaser of the project to meet such

other requirements as the Secretary determines to be appropriate;

and

"(9) prohibit the owner from refusing to lease a reasonable

number of units to holders of certificates and vouchers under

section 8 of the United States Housing Act of 1937 [42 U.S.C.

1437f] because of the status of the prospective tenants as

certificate and voucher holders.

"(f) Tenant and Other Participation and Capacity Building. -

"(1) Procedures. -

"(A) In general. - The Secretary shall establish procedures

to provide an opportunity for tenants of the project, residents

of the neighborhood, the local government, and other affected

parties to participate effectively and on a timely basis in the

restructuring process established by this subtitle.

"(B) Coverage. - These procedures shall take into account the

need to provide tenants of the project, residents of the

neighborhood, the local government, and other affected parties

timely notice of proposed restructuring actions and appropriate

access to relevant information about restructuring activities.

To the extent practicable and consistent with the need to

accomplish project restructuring in an efficient manner, the

procedures shall give all such parties an opportunity to

provide comments to the participating administrative entity in

writing, in meetings, or in another appropriate manner (which

comments shall be taken into consideration by the participating

administrative entity).

"(2) Required consultation. - The procedures developed pursuant

to paragraph (1) shall require consultation with tenants of the

project, residents of the neighborhood, the local government, and

other affected parties, in connection with at least the

following:

"(A) the mortgage restructuring and rental assistance

sufficiency plan;

"(B) any proposed transfer of the project; and

"(C) the rental assistance assessment plan pursuant to

section 515(c).

"(3) Funding. -

"(A) In general. - The Secretary shall make available not

more than $10,000,000 annually in funding, which amount shall

be in addition to any amounts made available under this

subparagraph and carried over from previous years, from which

the Secretary may make obligations to tenant groups, nonprofit

organizations, and public entities for building the capacity of

tenant organizations, for technical assistance in furthering

any of the purposes of this subtitle (including transfer of

developments to new owners), for technical assistance for

preservation of low-income housing for which project-based

rental assistance is provided at below market rent levels and

may not be renewed (including transfer of developments to

tenant groups, nonprofit organizations, and public entities),

for tenant services, and for tenant groups, nonprofit

organizations, and public entities described in section

517(a)(5), from those amounts made available under

appropriations Acts for implementing this subtitle or

previously made available for technical assistance in

connection with the preservation of affordable rental housing

for low-income persons.

"(B) Manner of providing. - Notwithstanding any other

provision of law restricting the use of preservation technical

assistance funds, the Secretary may provide any funds made

available under subparagraph (A) through existing technical

assistance programs pursuant to any other Federal law,

including the Low-Income Housing Preservation and Resident

Homeownership Act of 1990 [12 U.S.C. 4101 et seq.] and the

Multifamily Housing Property Disposition Reform Act of 1994

[Pub. L. 103-233, see Short Title of 1994 Amendment note set

out under section 1701 of Title 12, Banks and Banking], or

through any other means that the Secretary considers consistent

with the purposes of this subtitle, without regard to any

set-aside requirement otherwise applicable to those funds.

"(C) Prohibition. - None of the funds made available under

subparagraph (A) may be used directly or indirectly to pay for

any personal service, advertisement, telegram, telephone,

letter, printed or written matter, or other device, intended or

designed to influence in any manner a Member of Congress, to

favor or oppose, by vote or otherwise, any legislation or

appropriation by Congress, whether before or after the

introduction of any bill or resolution proposing such

legislation or appropriation.

"(g) Rent Levels. -

"(1) In general. - Except as provided in paragraph (2), each

mortgage restructuring and rental assistance sufficiency plan

pursuant to the terms, conditions, and requirements of this

subtitle shall establish for units assisted with project-based

assistance in eligible multifamily housing projects adjusted rent

levels that -

"(A) are equivalent to rents derived from comparable

properties, if -

"(i) the participating administrative entity makes the rent

determination within a reasonable period of time; and

"(ii) the market rent determination is based on not less

than 2 comparable properties; or

"(B) if those rents cannot be determined, are equal to 90

percent of the fair market rents for the relevant market area.

"(2) Exceptions. -

"(A) In general. - A contract under this section may include

rent levels that exceed the rent level described in paragraph

(1) at rent levels that do not exceed 120 percent of the fair

market rent for the market area (except that the Secretary may

waive this limit for not more than five percent of all units

subject to portfolio restructuring agreements, based on a

finding of special need), if the participating administrative

entity -

"(i) determines that the housing needs of the tenants and

the community cannot be adequately addressed through

implementation of the rent limitation required to be

established through a mortgage restructuring and rental

assistance sufficiency plan under paragraph (1); and

"(ii) follows the procedures under paragraph (3).

"(B) Exception rents. - In any fiscal year, a participating

administrative entity may approve exception rents on not more

than 20 percent of all units covered by the portfolio

restructuring agreement with expiring contracts in that fiscal

year, except that the Secretary may waive this ceiling upon a

finding of special need.

"(3) Rent levels for exception projects. - For purposes of this

section, a project eligible for an exception rent shall receive a

rent calculated on the actual and projected costs of operating

the project, at a level that provides income sufficient to

support a budget-based rent that consists of -

"(A) the debt service of the project;

"(B) the operating expenses of the project, as determined by

the participating administrative entity, including -

"(i) contributions to adequate reserves;

"(ii) the costs of maintenance and necessary

rehabilitation; and

"(iii) other eligible costs permitted under section 8 of

the United States Housing Act of 1937;

"(C) an adequate allowance for potential operating losses due

to vacancies and failure to collect rents, as determined by the

participating administrative entity;

"(D) an allowance for a reasonable rate of return to the

owner or purchaser of the project, as determined by the

participating administrative entity, which may be established

to provide incentives for owners or purchasers to meet

benchmarks of quality for management and housing quality; and

"(E) other expenses determined by the participating

administrative entity to be necessary for the operation of the

project.

"(h) Exemptions From Restructuring. - The following categories of

projects shall not be covered by a mortgage restructuring and

rental assistance sufficiency plan if -

"(1) the primary financing or mortgage insurance for the

multifamily housing project that is covered by that expiring

contract was provided by a unit of State government or a unit of

general local government (or an agency or instrumentality of a

unit of a State government or unit of general local government)

and the financing involves mortgage insurance under the National

Housing Act [42 U.S.C. 1701 et seq.], such that the

implementation of a mortgage restructuring and rental assistance

sufficiency plan under this subtitle is in conflict with

applicable law or agreements governing such financing;

"(2) the project is a project financed under section 202 of the

Housing Act of 1959 [12 U.S.C. 1701q] or section 515 of the

Housing Act of 1949 [42 U.S.C. 1485], or refinanced pursuant to

section 811 of the American Homeownership and Economic

Opportunity Act of 2000 (12 U.S.C. 1701q note); or

"(3) the project has an expiring contract under section 8 of

the United States Housing Act of 1937 entered into pursuant to

section 441 of the McKinney-Vento Homeless Assistance Act [42

U.S.C. 11401].

"SEC. 515. SECTION 8 RENEWALS AND LONG-TERM AFFORDABILITY

COMMITMENT BY OWNER OF PROJECT.

"(a) Section 8 Renewals of Restructured Projects. -

"(1) Project-based assistance. - Subject to the availability of

amounts provided in advance in appropriations Acts, and to the

control of the Secretary of applicable accounts in the Treasury

of the United States, with respect to an expiring section 8

contract on an eligible multifamily housing project to be renewed

with project-based assistance (based on a determination under

subsection (c)), the Secretary shall enter into contracts with

participating administrative entities pursuant to which the

participating administrative entity shall offer to renew or

extend the contract, or the Secretary shall offer to renew such

contract, and the owner of the project shall accept the offer, if

the initial renewal is in accordance with the terms and

conditions specified in the mortgage restructuring and rental

assistance sufficiency plan and the rental assistance assessment

plan.

"(2) Tenant-based assistance. - Subject to the availability of

amounts provided in advance in appropriations Acts and to the

control of the Secretary of applicable accounts in the Treasury

of the United States, with respect to an expiring section 8

contract on an eligible multifamily housing project to be renewed

with tenant-based assistance (based on a determination under

subsection (c)), the Secretary shall enter into contracts with

participating administrative entities pursuant to which the

participating administrative entity shall provide for the renewal

of section 8 assistance on an eligible multifamily housing

project with tenant-based assistance, or the Secretary shall

provide for such renewal, in accordance with the terms and

conditions specified in the mortgage restructuring and rental

assistance sufficiency plan and the rental assistance assessment

plan.

"(b) Required Commitment. - After the initial renewal of a

section 8 contract pursuant to this section, the owner shall accept

each offer made pursuant to subsection (a) to renew the contract,

for the term of the affordability and use restrictions required by

section 514(e)(6), if the offer to renew is on terms and conditions

specified in the mortgage restructuring and rental assistance

sufficiency plan.

"(c) Determination of Whether To Renew With Project-Based or

Tenant-Based Assistance. -

"(1) Mandatory renewal of project-based assistance. - Section 8

assistance shall be renewed with project-based assistance, if -

"(A) the project is located in an area in which the

participating administrative entity determines, based on

housing market indicators, such as low vacancy rates or high

absorption rates, that there is not adequate available and

affordable housing or that the tenants of the project would not

be able to locate suitable units or use the tenant-based

assistance successfully;

"(B) a predominant number of the units in the project are

occupied by elderly families, disabled families, or elderly and

disabled families; or

"(C) the project is held by a nonprofit cooperative ownership

housing corporation or nonprofit cooperative housing trust.

"(2) Rental assistance assessment plan. -

"(A) In general. - With respect to any project that is not

described in paragraph (1), the participating administrative

entity shall, after consultation with the owner of the project,

develop a rental assistance assessment plan to determine

whether to renew assistance for the project with tenant-based

assistance or project-based assistance.

"(B) Rental assistance assessment plan requirements. - Each

rental assistance assessment plan developed under this

paragraph shall include an assessment of the impact of

converting to tenant-based assistance and the impact of

extending project-based assistance on -

"(i) the ability of the tenants to find adequate,

available, decent, comparable, and affordable housing in the

local market;

"(ii) the types of tenants residing in the project (such as

elderly families, disabled families, large families, and

cooperative homeowners);

"(iii) the local housing needs identified in the

comprehensive housing affordability strategy, and local

market vacancy trends;

"(iv) the cost of providing assistance, comparing the

applicable payment standard to the project's adjusted rent

levels determined under section 514(g);

"(v) the long-term financial stability of the project;

"(vi) the ability of residents to make reasonable choices

about their individual living situations;

"(vii) the quality of the neighborhood in which the tenants

would reside; and

"(viii) the project's ability to compete in the

marketplace.

"(C) Reports to director. - Each participating administrative

entity shall report regularly to the Director as defined in

subtitle D, as the Director shall require, identifying -

"(i) each eligible multifamily housing project for which

the entity has developed a rental assistance assessment plan

under this paragraph that determined that the tenants of the

project generally supported renewal of assistance with

tenant-based assistance, but under which assistance for the

project was renewed with project-based assistance; and

"(ii) each project for which the entity has developed such

a plan under which the assistance is renewed using

tenant-based assistance.

"(3) Eligibility for tenant-based assistance. - Subject to

paragraph (4), with respect to any project that is not described

in paragraph (1), if a participating administrative entity

approves the use of tenant-based assistance based on a rental

assistance assessment plan developed under paragraph (2),

tenant-based assistance shall be provided to each assisted family

(other than a family already receiving tenant-based assistance)

residing in the project at the time the assistance described in

section 512(2)(B) terminates.

"(4) Assistance through enhanced vouchers. - In the case of any

family described in paragraph (3) that resides in a project

described in section 512(2)(B), the tenant-based assistance

provided shall be enhanced voucher assistance under section 8(t)

of the United States Housing Act of 1937 (42 U.S.C. 1437f(t)).

"(5) Inapplicability of certain provision. - If a participating

administrative entity approves renewal with project-based

assistance under this subsection, section 8(d)(2) of the United

States Housing Act of 1937 shall not apply.

"SEC. 516. PROHIBITION ON RESTRUCTURING.

"(a) Prohibition on Restructuring. - The Secretary may elect not

to consider any mortgage restructuring and rental assistance

sufficiency plan or request for contract renewal if the Secretary

or the participating administrative entity determines that -

"(1)(A) the owner or purchaser of the project has engaged in

material adverse financial or managerial actions or omissions

with regard to such project; or

"(B) the owner or purchaser of the project has engaged in

material adverse financial or managerial actions or omissions

with regard to other projects of such owner or purchaser that are

federally assisted or financed with a loan from, or mortgage

insured or guaranteed by, an agency of the Federal Government;

"(2) material adverse financial or managerial actions or

omissions include -

"(A) materially violating any Federal, State, or local law or

regulation with regard to this project or any other federally

assisted project, after receipt of notice and an opportunity to

cure;

"(B) materially breaching a contract for assistance under

section 8 of the United States Housing Act of 1937 [42 U.S.C.

1437f], after receipt of notice and an opportunity to cure;

"(C) materially violating any applicable regulatory or other

agreement with the Secretary or a participating administrative

entity, after receipt of notice and an opportunity to cure;

"(D) repeatedly and materially violating any Federal, State,

or local law or regulation with regard to the project or any

other federally assisted project;

"(E) repeatedly and materially breaching a contract for

assistance under section 8 of the United States Housing Act of

1937;

"(F) repeatedly and materially violating any applicable

regulatory or other agreement with the Secretary or a

participating administrative entity;

"(G) repeatedly failing to make mortgage payments at times

when project income was sufficient to maintain and operate the

property;

"(H) materially failing to maintain the property according to

housing quality standards after receipt of notice and a

reasonable opportunity to cure; or

"(I) committing any actions or omissions that would warrant

suspension or debarment by the Secretary;

"(3) the owner or purchaser of the property materially failed

to follow the procedures and requirements of this subtitle, after

receipt of notice and an opportunity to cure; or

"(4) the poor condition of the project cannot be remedied in a

cost effective manner, as determined by the participating

administrative entity.

The term 'owner' as used in this subsection, in addition to it

having the same meaning as in section 8(f) of the United States

Housing Act of 1937, also means an affiliate of the owner. The term

'purchaser' as used in this subsection means any private person or

entity, including a cooperative, an agency of the Federal

Government, or a public housing agency, that, upon purchase of the

project, would have the legal right to lease or sublease dwelling

units in the project, and also means an affiliate of the purchaser.

The terms 'affiliate of the owner' and 'affiliate of the purchaser'

means any person or entity (including, but not limited to, a

general partner or managing member, or an officer of either) that

controls an owner or purchaser, is controlled by an owner or

purchaser, or is under common control with the owner or purchaser.

The term 'control' means the direct or indirect power (under

contract, equity ownership, the right to vote or determine a vote,

or otherwise) to direct the financial, legal, beneficial or other

interests of the owner or purchaser.

"(b) Opportunity To Dispute Findings. -

"(1) In general. - During the 30-day period beginning on the

date on which the owner or purchaser of an eligible multifamily

housing project receives notice of a rejection under subsection

(a) or of a mortgage restructuring and rental assistance

sufficiency plan under section 514, the Secretary or

participating administrative entity shall provide that owner or

purchaser with an opportunity to dispute the basis for the

rejection and an opportunity to cure.

"(2) Affirmation, modification, or reversal. -

"(A) In general. - After providing an opportunity to dispute

under paragraph (1), the Secretary or the participating

administrative entity may affirm, modify, or reverse any

rejection under subsection (a) or rejection of a mortgage

restructuring and rental assistance sufficiency plan under

section 514.

"(B) Reasons for decision. - The Secretary or the

participating administrative entity, as applicable, shall

identify the reasons for any final decision under this

paragraph.

"(C) Review process. - The Secretary shall establish an

administrative review process to appeal any final decision

under this paragraph.

"(c) Final Determination. - Any final determination under this

section shall not be subject to judicial review.

"(d) Displaced Tenants. -

"(1) Notice to certain residents. - The Office shall notify any

tenant that is residing in a project or receiving assistance

under section 8 of the United States Housing Act of 1937 (42

U.S.C. 1437f) at the time of rejection under this section, of

such rejection, except that the Office may delegate the

responsibility to provide notice under this paragraph to the

participating administrative entity.

"(2) Assistance and moving expenses. - Subject to the

availability of amounts provided in advance in appropriations

Acts, for any low-income tenant that is residing in a project or

receiving assistance under section 8 of the United States Housing

Act of 1937 at the time of rejection under this section, that

tenant shall be provided with tenant-based assistance and

reasonable moving expenses, as determined by the Secretary.

"(e) Transfer of Property. - For properties disqualified from the

consideration of a mortgage restructuring and rental assistance

sufficiency plan under this section in accordance with paragraph

(1) or (2) of subsection (a) because of actions by an owner or

purchaser, the Secretary shall establish procedures to facilitate

the voluntary sale or transfer of a property as part of a mortgage

restructuring and rental assistance sufficiency plan, with a

preference for tenant organizations and tenant-endorsed

community-based nonprofit and public agency purchasers meeting such

reasonable qualifications as may be established by the Secretary.

"SEC. 517. RESTRUCTURING TOOLS.

"(a) Mortgage Restructuring. -

"(1) In this subtitle, an approved mortgage restructuring and

rental assistance sufficiency plan shall include restructuring

mortgages in accordance with this subsection to provide -

"(A) a restructured or new first mortgage that is sustainable

at rents at levels that are established in section 514(g); and

"(B) a second mortgage that is in an amount equal to not more

than the greater of -

"(i) the full or partial payment of claim made under this

subtitle; or

"(ii) the difference between the restructured or new first

mortgage and the indebtedness under the existing insured

mortgage immediately before it is restructured or refinanced,

provided that the amount of the second mortgage shall be in

an amount that the Secretary or participating administrative

entity determines can reasonably be expected to be repaid.

"(2) The second mortgage shall bear interest at a rate not to

exceed the applicable Federal rate as defined in section 1274(d)

of the Internal Revenue Code of 1986 [26 U.S.C. 1274(d)]. The

term of the second mortgage shall be equal to the term of the

restructured or new first mortgage.

"(3) Payments on the second mortgage shall be deferred when the

first mortgage remains outstanding, except to the extent there is

excess project income remaining after payment of all reasonable

and necessary operating expenses (including deposits in a reserve

for replacement), debt service on the first mortgage, and any

other expenditures approved by the Secretary. At least 75 percent

of any excess project income shall be applied to payments on the

second mortgage, and the Secretary or the participating

administrative entity may permit up to 25 percent to be paid to

the project owner if the Secretary or participating

administrative entity determines that the project owner meets

benchmarks for management and housing quality.

"(4) The full amount of the second mortgage shall be

immediately due and payable if -

"(A) the first mortgage is terminated or paid in full, except

as otherwise provided by the holder of the second mortgage;

"(B) the project is purchased and the second mortgage is

assumed by any subsequent purchaser in violation of guidelines

established by the Secretary; or

"(C) the Secretary provides notice to the project owner that

such owner has failed to materially comply with any

requirements of this section or the United States Housing Act

of 1937 [42 U.S.C. 1437 et seq.] as those requirements apply to

the project, with a reasonable opportunity for such owner to

cure such failure.

"(5) The Secretary may modify the terms of the second mortgage,

assign the second mortgage to the acquiring organization or

agency, or forgive all or part of the second mortgage if the

Secretary holds the second mortgage and if the project is

acquired by a tenant organization or tenant-endorsed

community-based nonprofit or public agency, pursuant to

guidelines established by the Secretary.

"(6) The second mortgage under this section may be a first

mortgage if no restructured or new first mortgage will meet the

requirement of paragraph (1)(A).

"(b) Restructuring Tools. - In addition to the requirements of

subsection (a) and to the extent these actions are consistent with

this section and with the control of the Secretary of applicable

accounts in the Treasury of the United States, an approved mortgage

restructuring and rental assistance sufficiency plan under this

subtitle may include one or more of the following actions:

"(1) Full or partial payment of claim. - Making a full payment

of claim or partial payment of claim under section 541(b) of the

National Housing Act [12 U.S.C. 1735f-19(b)], as amended by

section 523(b) of this Act. Any payment under this paragraph

shall not require the approval of a mortgagee.

"(2) Refinancing of debt. - Refinancing of all or part of the

debt on a project. If the refinancing involves a mortgage that

will continue to be insured under the National Housing Act [12

U.S.C. 1701 et seq.], the refinancing shall be documented through

amendment of the existing insurance contract and not through a

new insurance contract.

"(3) Mortgage insurance. - Providing FHA multifamily mortgage

insurance, reinsurance or other credit enhancement alternatives,

including multifamily risk-sharing mortgage programs, as provided

under section 542 of the Housing and Community Development Act of

1992 [Pub. L. 102-550, 12 U.S.C. 1707 note]. The Secretary shall

use risk-shared financing under section 542(c) of the Housing and

Community Development Act of 1992 for any mortgage restructuring,

rehabilitation financing, or debt refinancing included as part of

a mortgage restructuring and rental assistance sufficiency plan

if the terms and conditions are considered to be the best

available financing in terms of financial savings to the FHA

insurance funds and will result in reduced risk of loss to the

Federal Government. Any limitations on the number of units

available for mortgage insurance under section 542 shall not

apply to eligible multifamily housing projects. Any credit

subsidy costs of providing mortgage insurance shall be paid from

the Liquidating Accounts of the General Insurance Fund or the

Special Risk Insurance Fund and shall not be subject to any

limitation on appropriations.

"(4) Credit enhancement. - Providing any additional State or

local mortgage credit enhancements and risk-sharing arrangements

that may be established with State or local housing finance

agencies, the Federal Housing Finance Board, the Federal National

Mortgage Association, and the Federal Home Loan Mortgage

Corporation, to a modified or refinanced first mortgage.

"(5) Compensation of third parties. - Consistent with the

portfolio restructuring agreement, entering into agreements,

incurring costs, or making payments, including incentive

agreements designed to reward superior performance in meeting the

purposes of this Act, as may be reasonably necessary, to

compensate the participation of participating administrative

entities and other parties in undertaking actions authorized by

this subtitle. Upon request to the Secretary, participating

administrative entities that are qualified under the United

States Housing Act of 1937 to serve as contract administrators

shall be the contract administrators under section 8 of the

United States Housing Act of 1937 [12 U.S.C. 1437f] for purposes

of any contracts entered into as part of an approved mortgage

restructuring and rental assistance sufficiency plan. Subject to

the availability of amounts provided in advance in appropriations

Acts for administrative fees under section 8 of the United States

Housing Act of 1937, such amounts may be used to compensate

participating administrative entities for compliance monitoring

costs incurred under section 519.

"(6) Use of project accounts. - Applying any residual receipts,

replacement reserves, and any other project accounts not required

for project operations, to maintain the long-term affordability

and physical condition of the property or of other eligible

multifamily housing projects. The participating administrative

entity may expedite the acquisition of residual receipts,

replacement reserves, or other such accounts, by entering into

agreements with owners of housing covered by an expiring contract

to provide an owner with a share of the receipts, not to exceed

10 percent, in accordance with guidelines established by the

Secretary.

"(c) Rehabilitation Needs and Addition of Significant Features. -

"(1) Rehabilitation needs. -

"(A) In general. - Rehabilitation may be paid from the

residual receipts, replacement reserves, or any other project

accounts not required for project operations, or, as provided

in appropriations Acts and subject to the control of the

Secretary of applicable accounts in the Treasury of the United

States, from budget authority provided for increases in the

budget authority for assistance contracts under section 8 of

the United States Housing Act of 1937, the rehabilitation grant

program established under section 236 of the National Housing

Act [12 U.S.C. 1715z-1], as amended by section 531 of subtitle

B of this Act, or through the debt restructuring transaction.

Rehabilitation under this paragraph shall only be for the

purpose of restoring the project to a non-luxury standard

adequate for the rental market intended at the original

approval of the project-based assistance.

"(B) Contribution. - Each owner or purchaser of a project to

be rehabilitated under an approved mortgage restructuring and

rental assistance sufficiency plan shall contribute, from

non-project resources, not less than 25 percent of the amount

of rehabilitation assistance received, except that the

participating administrative entity may provide an exception

from the requirement of this subparagraph for housing

cooperatives.

"(2) Addition of significant features. -

"(A) Authority. - An approved mortgage restructuring and

rental assistance sufficiency plan may require the improvement

of the project by the addition of significant features that are

not necessary for rehabilitation to the standard provided under

paragraph (1), such as air conditioning, an elevator, and

additional community space. The Secretary shall establish

guidelines regarding the inclusion of requirements regarding

such additional significant features under such plans.

"(B) Funding. - Significant features added pursuant to an

approved mortgage restructuring and rental assistance

sufficiency plan may be paid from the funding sources specified

in the first sentence of paragraph (1)(A).

"(C) Limitation on owner contribution. - An owner of a

project may not be required to contribute from non-project

resources, toward the cost of any additional significant

features required pursuant to this paragraph, more than 25

percent of the amount of any assistance received for the

inclusion of such features.

"(D) Applicability. - This paragraph shall apply to all

eligible multifamily housing projects, except projects for

which the Secretary and the project owner executed a mortgage

restructuring and rental assistance sufficiency plan on or

before the date of the enactment of the Mark-to-Market

Extension Act of 2001 [Jan. 10, 2002].

"(d) Prohibition on Equity Sharing by the Secretary. - The

Secretary is prohibited from participating in any equity agreement

or profit-sharing agreement in conjunction with any eligible

multifamily housing project.

"(e) Conflict of Interest Guidelines. - The Secretary may

establish guidelines to prevent conflicts of interest by a

participating administrative entity that provides, directly or

through risk-sharing arrangements, any form of credit enhancement

or financing pursuant to subsections [sic] (b)(3) or (b)(4) or to

prevent conflicts of interest by any other person or entity under

this subtitle.

"SEC. 518. MANAGEMENT STANDARDS.

"Each participating administrative entity shall establish

management standards, including requirements governing conflicts of

interest between owners, managers, contractors with an identity of

interest, pursuant to guidelines established by the Secretary and

consistent with industry standards.

"SEC. 519. MONITORING OF COMPLIANCE.

"(a) Compliance Agreements. - (1) Pursuant to regulations issued

by the Secretary under section 522(a), each participating

administrative entity, through binding contractual agreements with

owners and otherwise, shall ensure long-term compliance with the

provisions of this subtitle. Each agreement shall, at a minimum,

provide for -

"(A) enforcement of the provisions of this subtitle; and

"(B) remedies for the breach of those provisions.

"(2) If the participating administrative entity is not qualified

under the United States Housing Act of 1937 [42 U.S.C. 1437 et

seq.] to be a section 8 contract administrator or fails to perform

its duties under the portfolio restructuring agreement, the

Secretary shall have the right to enforce the agreement.

"(b) Periodic Monitoring. -

"(1) In general. - Not less than annually, each participating

administrative entity that is qualified to be the section 8

contract administrator shall review the status of all multifamily

housing projects for which a mortgage restructuring and rental

assistance sufficiency plan has been implemented.

"(2) Inspections. - Each review under this subsection shall

include onsite inspection to determine compliance with housing

codes and other requirements as provided in this subtitle and the

portfolio restructuring agreements.

"(3) Administration. - If the participating administrative

entity is not qualified under the United States Housing Act of

1937 to be a section 8 contract administrator, either the

Secretary or a qualified State or local housing agency shall be

responsible for the review required by this subsection.

"(c) Audit by the Secretary. - The Comptroller General of the

United States, the Secretary, and the Inspector General of the

Department of Housing and Urban Development may conduct an audit at

any time of any multifamily housing project for which a mortgage

restructuring and rental assistance sufficiency plan has been

implemented.

"SEC. 520. REPORTS TO CONGRESS.

"(a) Annual Review. - In order to ensure compliance with this

subtitle, the Secretary shall conduct an annual review and report

to the Congress on actions taken under this subtitle and the status

of eligible multifamily housing projects.

"(b) Semiannual Review. - Not less than semiannually during the

2-year period beginning on the date of the enactment of this Act

[Oct. 27, 1997] and not less than annually thereafter, the

Secretary shall submit reports to the Committee on Financial

Services of the House of Representatives and the Committee on

Banking, Housing, and Urban Affairs of the Senate stating, for such

periods, the total number of projects identified by participating

administrative entities under each of clauses (i) and (ii) of

section 515(c)(2)(C).

"SEC. 521. GAO AUDIT AND REVIEW.

"(a) Initial Audit. - Not later than 18 months after the

effective date of final regulations promulgated under this

subtitle, the Comptroller General of the United States shall

conduct an audit to evaluate eligible multifamily housing projects

and the implementation of mortgage restructuring and rental

assistance sufficiency plans.

"(b) Report. -

"(1) In general. - Not later than 18 months after the audit

conducted under subsection (a), the Comptroller General of the

United States shall submit to Congress a report on the status of

eligible multifamily housing projects and the implementation of

mortgage restructuring and rental assistance sufficiency plans.

"(2) Contents. - The report submitted under paragraph (1) shall

include -

"(A) a description of the initial audit conducted under

subsection (a); and

"(B) recommendations for any legislative action to increase

the financial savings to the Federal Government of the

restructuring of eligible multifamily housing projects balanced

with the continued availability of the maximum number of

affordable low-income housing units.

"SEC. 522. REGULATIONS.

"(a) Rulemaking and Implementation. -

"(1) Interim regulations. - The Director shall issue such

interim regulations as may be necessary to implement this

subtitle and the amendments made by this subtitle with respect to

eligible multifamily housing projects covered by contracts

described in section 512(2)(B) that expire in fiscal year 1999 or

thereafter. If, before the expiration of such period, the

Director has not been appointed, the Secretary shall issue such

interim regulations.

"(2) Final regulations. - The Director shall issue final

regulations necessary to implement this subtitle and the

amendments made by this subtitle with respect to eligible

multifamily housing projects covered by contracts described in

section 512(2)(B) that expire in fiscal year 1999 or thereafter

before the later of: (A) the expiration of the 12-month period

beginning upon the date of the enactment of this Act [Oct. 27,

1997]; and (B) the 3-month period beginning upon the appointment

of the Director under subtitle D.

"(3) Factors for consideration. - Before the publication of the

final regulations under paragraph (2), in addition to public

comments invited in connection with publication of the interim

rule, the Secretary shall -

"(A) seek recommendations on the implementation of sections

513(b) and 515(c)(1) from organizations representing -

"(i) State housing finance agencies and local housing

agencies;

"(ii) other potential participating administering entities;

"(iii) tenants;

"(iv) owners and managers of eligible multifamily housing

projects;

"(v) States and units of general local government; and

"(vi) qualified mortgagees; and

"(B) convene not less than 3 public forums at which the

organizations making recommendations under subparagraph (A) may

express views concerning the proposed disposition of the

recommendations.

"(b) Transition Provision for Contracts Expiring in Fiscal Year

1998. - Notwithstanding any other provision of law, the Secretary

shall apply all the terms of section 211 and section 212 of the

Departments of Veterans Affairs and Housing and Urban Development,

and Independent Agencies Appropriations Act, 1997 [Pub. L. 104-204,

set out below] (except for section 212(h)(1)(G) and the limitation

in section 212(k)) contracts for project-based assistance that

expire during fiscal year 1998 (in the same manner that such

provisions apply to expiring contracts defined in section 212(a)(3)

of such Act), except that section 517(a) of the Act shall apply to

mortgages on projects subject to such contracts.

"SEC. 523. TECHNICAL AND CONFORMING AMENDMENTS.

"(a) Calculation of Limit on Project-Based Assistance. - [Amended

this section.]

"(b) Partial Payment of Claims on Multifamily Housing Projects. -

[Amended section 1735f-19 of Title 12, Banks and Banking.]

"(c) Reuse and Rescission of Certain Recaptured Budget Authority.

- [Amended this section.]

"(d) Section 8 Contract Renewals. - [Amended section 405(a) of

Pub. L. 104-99, set out below.]

"(e) Renewal Upon Request of Owner. - [Amended section 211 of

Pub. L. 104-204, set out below.]

"(f) Extension of Demonstration Contract Period. - [Amended

section 212 of Pub. L. 104-204, set out below.]

"SEC. 524. RENEWAL OF EXPIRING PROJECT-BASED SECTION 8 CONTRACTS.

"(a) In General. -

"(1) Renewal. - Subject to paragraph (2), upon termination or

expiration of a contract for project-based assistance under

section 8 for a multifamily housing project (and notwithstanding

section 8(v) of the United States Housing Act of 1937 [42 U.S.C.

1437f] for loan management assistance), the Secretary shall, at

the request of the owner of the project and to the extent

sufficient amounts are made available in appropriation Acts, use

amounts available for the renewal of assistance under section 8

of such Act to provide such assistance for the project. The

assistance shall be provided under a contract having such terms

and conditions as the Secretary considers appropriate, subject to

the requirements of this section. This section shall not require

contract renewal for a project that is eligible under this

subtitle for a mortgage restructuring and rental assistance

sufficiency plan, if there is no approved plan for the project

and the Secretary determines that such an approved plan is

necessary.

"(2) Prohibition on renewal. - Notwithstanding part 24 of title

24 of the Code of Federal Regulations, the Secretary may elect

not to renew assistance for a project otherwise required to be

renewed under paragraph (1) or provide comparable benefits under

paragraph (1) or (2) of subsection (e) for a project described in

either such paragraph, if the Secretary determines that a

violation under paragraphs (1) through (4) of section 516(a) has

occurred with respect to the project. For purposes of such a

determination, the provisions of section 516 shall apply to a

project under this section in the same manner and to the same

extent that the provisions of such section apply to eligible

multifamily housing projects, except that the Secretary shall

make the determination under section 516(a)(4).

"(3) Contract term for mark-up-to-market contracts. - In the

case of an expiring or terminating contract that has rent levels

less than comparable market rents for the market area, if the

rent levels under the renewal contract under this section are

equal to comparable market rents for the market area, the

contract shall have a term of not less than 5 years, subject to

the availability of sufficient amounts in appropriation Acts.

"(4) Renewal rents. - Except as provided in subsection (b), the

contract for assistance shall provide assistance at the following

rent levels:

"(A) Market rents. - At the request of the owner of the

project, at rent levels equal to the lesser of comparable

market rents for the market area or 150 percent of the fair

market rents, in the case only of a project that -

"(i) has rent levels under the expiring or terminating

contract that do not exceed such comparable market rents;

"(ii) does not have a low- and moderate-income use

restriction that can not be eliminated by unilateral action

by the owner;

"(iii) is decent, safe, and sanitary housing, as determined

by the Secretary;

"(iv) is not -

"(I) owned by a nonprofit entity;

"(II) subject to a contract for moderate rehabilitation

assistance under section 8(e)(2) of the United States Housing

Act of 1937, as in effect before October 1, 1991; or

"(III) a project for which the public housing agency provided

voucher assistance to one or more of the tenants after the

owner has provided notice of termination of the contract

covering the tenant's unit; and

"(v) has units assisted under the contract for which the

comparable market rent exceeds 110 percent of the fair market

rent.

The Secretary may adjust the percentages of fair market rent (as

specified in the matter preceding clause (i) and in clause (v)),

but only upon a determination and written notification to the

Congress within 10 days of making such determination, that such

adjustment is necessary to ensure that this subparagraph covers

projects with a high risk of nonrenewal of expiring contracts for

project-based assistance.

"(B) Reduction to market rents. - In the case of a project

that has rent levels under the expiring or terminating contract

that exceed comparable market rents for the market area, at

rent levels equal to such comparable market rents.

"(C) Rents not exceeding market rents. - In the case of a

project that is not subject to subparagraph (A) or (B), at rent

levels that -

"(i) are not less than the existing rents under the

terminated or expiring contract, as adjusted by an operating

cost adjustment factor established by the Secretary (which

shall not result in a negative adjustment), if such adjusted

rents do not exceed comparable market rents for the market

area; and

"(ii) do not exceed comparable market rents for the market

area.

In determining the rent level for a contract under this

subparagraph, the Secretary shall approve rents sufficient to

cover budget-based cost increases and shall give greater

consideration to providing rent at a level up to comparable

market rents for the market area based on the number of the

criteria under clauses (i) through (iii) of subparagraph (D) that

the project meets. Notwithstanding any other provision of law,

the Secretary shall include in such budget-based cost increases

costs relating to the project as a whole (including costs

incurred with respect to units not covered by the contract for

assistance), but only (I) if inclusion of such costs is requested

by the owner or purchaser of the project, (II) if inclusion of

such costs will permit capital repairs to the project or

acquisition of the project by a nonprofit organization, and (III)

to the extent that inclusion of such costs (or a portion thereof)

complies with the requirement under clause (ii).

"(D) Waiver of 150 percent limitation. - Notwithstanding

subparagraph (A), at rent levels up to comparable market rents

for the market area, in the case of a project that meets the

requirements under clauses (i) through (v) of subparagraph (A)

and -

"(i) has residents who are a particularly vulnerable

population, as demonstrated by a high percentage of units

being rented to elderly families, disabled families, or large

families;

"(ii) is located in an area in which tenant-based

assistance would be difficult to use, as demonstrated by a

low vacancy rate for affordable housing, a high turnback rate

for vouchers, or a lack of comparable rental housing; or

"(iii) is a high priority for the local community, as

demonstrated by a contribution of State or local funds to the

property.

In determining the rent level for a contract under this

subparagraph, the Secretary shall approve rents sufficient to

cover budget-based cost increases and shall give greater

consideration to providing rent at a level up to comparable

market rents for the market area based on the number of the

criteria under clauses (i) through (iv) that the project meets.

"(5) Comparable market rents and comparison with fair market

rents. - The Secretary shall prescribe the method for determining

comparable market rent by comparison with rents charged for

comparable properties (as such term is defined in section 512),

which may include appropriate adjustments for utility allowances

and adjustments to reflect the value of any subsidy (other than

section 8 assistance) provided by the Department of Housing and

Urban Development.

"(b) Exception Rents. -

"(1) Renewal. - In the case of a multifamily housing project

described in paragraph (2), pursuant to the request of the owner

of the project, the contract for assistance for the project

pursuant to subsection (a) shall provide assistance at the lesser

of the following rent levels:

"(A) Adjusted existing rents. - The existing rents under the

expiring contract, as adjusted by an operating cost adjustment

factor established by the Secretary (which shall not result in

a negative adjustment).

"(B) Budget-based rents. - Subject to a determination by the

Secretary that a rent level under this subparagraph is

appropriate for a project, a rent level that provides income

sufficient to support a budget-based rent (including a

budget-based rent adjustment if justified by reasonable and

expected operating expenses).

"(2) Projects covered. - A multifamily housing project

described in this paragraph is a multifamily housing project that

-

"(A) is not an eligible multifamily housing project under

section 512(2); or

"(B) is exempt from mortgage restructuring under this

subtitle pursuant to section 514(h).

"(3) Moderate rehabilitation projects. - In the case of a

project with a contract under the moderate rehabilitation

program, other than a moderate rehabilitation contract under

section 441 of the McKinney-Vento Homeless Assistance Act [42

U.S.C. 11401], pursuant to the request of the owner of the

project, the contract for assistance for the project pursuant to

subsection (a) shall provide assistance at the lesser of the

following rent levels:

"(A) Adjusted existing rents. - The existing rents under the

expiring contract, as adjusted by an operating cost adjustment

factor established by the Secretary (which shall not result in

a negative adjustment).

"(B) Fair market rents. - Fair market rents (less any amounts

allowed for tenant-purchased utilities).

"(C) Market rents. - Comparable market rents for the market

area.

"(c) Rent Adjustments After Renewal of Contract. -

"(1) Required. - After the initial renewal of a contract for

assistance under section 8 of the United States Housing Act of

1937 [42 U.S.C. 1437f] pursuant to subsection (a), (b)(1), or

(e)(2), the Secretary shall annually adjust the rents using an

operating cost adjustment factor established by the Secretary

(which shall not result in a negative adjustment) or, upon the

request of the owner and subject to approval of the Secretary, on

a budget basis. In the case of projects with contracts renewed

pursuant to subsection (a) or pursuant to subsection (e)(2) at

rent levels equal to comparable market rents for the market area,

at the expiration of each 5-year period, the Secretary shall

compare existing rents with comparable market rents for the

market area and may make any adjustments in the rent necessary to

maintain the contract rents at a level not greater than

comparable market rents or to increase rents to comparable market

rents.

"(2) Discretionary. - In addition to review and adjustment

required under paragraph (1), in the case of projects with

contracts renewed pursuant to subsection (a) or pursuant to

subsection (e)(2) at rent levels equal to comparable market rents

for the market area, the Secretary may, at the discretion of the

Secretary but only once within each 5-year period referred to in

paragraph (1), conduct a comparison of rents for a project and

adjust the rents accordingly to maintain the contract rents at a

level not greater than comparable market rents or to increase

rents to comparable market rents.

"(d) Enhanced Vouchers Upon Contract Expiration. -

"(1) In general. - In the case of a contract for project-based

assistance under section 8 for a covered project that is not

renewed under subsection (a) or (b) of this section (or any other

authority), to the extent that amounts for assistance under this

subsection are provided in advance in appropriation Acts, upon

the date of the expiration of such contract the Secretary shall

make enhanced voucher assistance under section 8(t) of the United

States Housing Act of 1937 (42 U.S.C. 1437f(t)) available on

behalf of each low-income family who, upon the date of such

expiration, is residing in an assisted dwelling unit in the

covered project.

"(2) Definitions. - For purposes of this subsection, the

following definitions shall apply:

"(A) Assisted dwelling unit. - The term 'assisted dwelling

unit' means a dwelling unit that -

"(i) is in a covered project; and

"(ii) is covered by rental assistance provided under the

contract for project-based assistance for the covered

project.

"(B) Covered project. - The term 'covered project' means any

housing that -

"(i) consists of more than four dwelling units;

"(ii) is covered in whole or in part by a contract for

project-based assistance under -

"(I) the new construction or substantial rehabilitation

program under section 8(b)(2) of the United States Housing

Act of 1937 (as in effect before October 1, 1983);

"(II) the property disposition program under section 8(b) of

the United States Housing Act of 1937;

"(III) the moderate rehabilitation program under section

8(e)(2) of the United States Housing Act of 1937 (as in

effect before October 1, 1991);

"(IV) the loan management assistance program under section 8

of the United States Housing Act of 1937;

"(V) section 23 of the United States Housing Act of 1937 [42

U.S.C. 1437u] (as in effect before January 1, 1975);

"(VI) the rent supplement program under section 101 of the

Housing and Urban Development Act of 1965 [12 U.S.C. 1701s];

or

"(VII) section 8 of the United States Housing Act of 1937,

following conversion from assistance under section 101 of the

Housing and Urban Development Act of 1965,

which contract will (under its own terms) expire during the

period consisting of fiscal years 2000 through 2004; and

"(iii) is not housing for which residents are eligible for

enhanced voucher assistance as provided, pursuant to the

'Preserving Existing Housing Investment' account in the

Departments of Veterans Affairs and Housing and Urban

Development, and Independent Agencies Appropriations Act,

1997 (Public Law 104-204; 110 Stat. 2884) or any other

subsequently enacted provision of law, in lieu of any

benefits under section 223 of the Low-Income Housing

Preservation and Resident Homeownership Act of 1990 (12

U.S.C. 4113).

"(4) Authorization of appropriations. - There are authorized to

be appropriated for each of fiscal years 2000, 2001, 2002, 2003,

and 2004 such sums as may be necessary for enhanced voucher

assistance under this subsection.

"(e) Contractual Commitments Under Preservation Laws. - Except as

provided in subsection (a)(2) and notwithstanding any other

provision of this subtitle, the following shall apply:

"(1) Preservation projects. - Upon expiration of a contract for

assistance under section 8 [42 U.S.C. 1437f] for a project that

is subject to an approved plan of action under the Emergency Low

Income Housing Preservation Act of 1987 (12 U.S.C. 1715l note) or

the Low-Income Housing Preservation and Resident Homeownership

Act of 1990 (12 U.S.C. 4101 et seq.), to the extent amounts are

specifically made available in appropriation Acts, the Secretary

shall provide to the owner benefits comparable to those provided

under such plan of action, including distributions, rent increase

procedures, and duration of low-income affordability

restrictions. This paragraph shall apply to projects with

contracts expiring before, on, or after the date of the enactment

of this section [Oct. 27, 1997].

"(2) Demonstration projects. -

"(A) In general. - Upon expiration of a contract for

assistance under section 8 for a project entered into pursuant

to any authority specified in subparagraph (B) for which the

Secretary determines that debt restructuring is inappropriate,

the Secretary shall, at the request of the owner of the project

and to the extent sufficient amounts are made available in

appropriation Acts, provide benefits to the owner comparable to

those provided under such contract, including annual

distributions, rent increase procedures, and duration of

low-income affordability restrictions. This paragraph shall

apply to projects with contracts expiring before, on, or after

the date of the enactment of this section [Oct. 27, 1997].

"(B) Demonstration programs. - The authority specified in

this subparagraph is the authority under -

"(i) section 210 of the Departments of Veterans Affairs and

Housing and Urban Development, and Independent Agencies

Appropriations Act, 1996 (Public Law 104-134; 110 Stat.

1321-285; 42 U.S.C. 1437f note);

"(ii) section 212 of the Departments of Veterans Affairs

and Housing and Urban Development, and Independent Agencies

Appropriations Act, 1997 (Public Law 104-204; 110 Stat. 2897;

42 U.S.C. 1437f note); and

"(iii) either of such sections, pursuant to any provision

of this title [see Short Title of 1997 Amendment note set out

under section 1701 of title 12].

"(3) Mortgage restructuring and rental assistance sufficiency

plans. - Notwithstanding paragraph (1), the owner of the project

may request, and the Secretary may consider, mortgage

restructuring and rental assistance sufficiency plans to

facilitate sales or transfers of properties under this subtitle,

subject to an approved plan of action under the Emergency Low

Income Housing Preservation Act of 1987 (12 U.S.C. 1715l note)

[see Codification note preceding section 4101 of Title 12, Banks

and Banking] or the Low-Income Housing Preservation and Resident

Homeownership Act of 1990 (12 U.S.C. 4101 et seq.), which plans

shall result in a sale or transfer of those properties.

"(f) Preemption of Conflicting State Laws Limiting Distributions.

-

"(1) In general. - Except as provided in paragraph (2), no

State or political subdivision of a State may establish, continue

in effect, or enforce any law or regulation that limits or

restricts, to an amount that is less than the amount provided for

under the regulations of the Secretary establishing allowable

project distributions to provide a return on investment, the

amount of surplus funds accruing after the date of the enactment

of this section [Oct. 27, 1997] that may be distributed from any

multifamily housing project assisted under a contract for rental

assistance renewed under any provision of this section (except

subsection (b)) to the owner of the project.

"(2) Exception and waiver. - Paragraph (1) shall not apply to

any law or regulation to the extent such law or regulation

applies to -

"(A) a State-financed multifamily housing project; or

"(B) a multifamily housing project for which the owner has

elected to waive the applicability of paragraph (1).

"(3) Treatment of low-income use restrictions. - This

subsection may not be construed to provide for, allow, or result

in the release or termination, for any project, of any low- or

moderate-income use restrictions that can not be eliminated by

unilateral action of the owner of the project.

"(g) Applicability. - Except to the extent otherwise specifically

provided in this section, this section shall apply with respect to

any multifamily housing project having a contract for project-based

assistance under section 8 [42 U.S.C. 1437f] that terminates or

expires during fiscal year 2000 or thereafter.

"SEC. 525. CONSISTENCY OF RENT LEVELS UNDER ENHANCED VOUCHER

ASSISTANCE AND RENT RESTRUCTURINGS.

"(a) In General. - The Secretary shall examine the standards and

procedures for determining and establishing the rent standards

described under subsection (b). Pursuant to such examination, the

Secretary shall establish procedures and guidelines that are

designed to ensure that the amounts determined by the various rent

standards for the same dwelling units are reasonably consistent and

reflect rents for comparable unassisted units in the same area as

such dwelling units.

"(b) Rent Standards. - The rent standards described in this

subsection are as follows:

"(1) Enhanced vouchers. - The payment standard for enhanced

voucher assistance under section 8(t) of the United States

Housing Act of 1937 (42 U.S.C. 1437f(t)).

"(2) Mark-to-market. - The rents derived from comparable

properties, for purposes of section 514(g) of this Act.

"(3) Contract renewal. - The comparable market rents for the

market area, for purposes of section 524(a)(4) of this Act.

"SUBTITLE D - OFFICE OF MULTIFAMILY HOUSING ASSISTANCE

RESTRUCTURING

"SEC. 571. ESTABLISHMENT OF OFFICE OF MULTIFAMILY HOUSING

ASSISTANCE RESTRUCTURING.

"There is hereby established an office within the Department of

Housing and Urban Development, which shall be known as the Office

of Multifamily Housing Assistance Restructuring.

"SEC. 572. DIRECTOR.

"(a) Appointment. - The Office shall be under the management of a

Director, who shall be appointed by the President from among

individuals who are citizens of the United States and have a

demonstrated understanding of financing and mortgage restructuring

for affordable multifamily housing.

"(b) Vacancy. - A vacancy in the position of Director shall be

filled by appointment in the manner provided under subsection (a).

The President shall make such an appointment not later than 60 days

after such position first becomes vacant.

"(c) Deputy Director. -

"(1) In general. - The Office shall have a Deputy Director who

shall be appointed by the Director from among individuals who are

citizens of the United States and have a demonstrated

understanding of financing and mortgage restructuring for

affordable multifamily housing.

"(2) Functions. - The Deputy Director shall have such

functions, powers, and duties as the Director shall prescribe. In

the event of the death, resignation, sickness, or absence of the

Director, the Deputy Director shall serve as acting Director

until the return of the Director or the appointment of a

successor pursuant to subsection (b).

"SEC. 573. DUTY AND AUTHORITY OF DIRECTOR.

"(a) Duty. - The Secretary shall, acting through the Director,

administer the program of mortgage and rental assistance

restructuring for eligible multifamily housing projects under

subtitle A. During the period before the Director is appointed, the

Secretary may carry out such program.

"(b) Authority. - The Director is authorized to make such

determinations, take such actions, issue such regulations, and

perform such functions assigned to the Director under law as the

Director determines necessary to carry out such functions, subject

to the review and approval of the Secretary. The Director shall

semiannually submit a report to the Assistant Secretary of the

Department of Housing and Urban Development who is the Federal

Housing Commissioner regarding the activities, determinations, and

actions of the Director.

"(c) Delegation of Authority. - The Director may delegate to

officers and employees of the Office (but not to contractors,

subcontractors, or consultants) any of the functions, powers, and

duties of the Director, as the Director considers appropriate.

"(d) Independence in Providing Information to Congress. -

"(1) In general. - Notwithstanding subsection (a) or (b), the

Director shall not be required to obtain the prior approval,

comment, or review of any officer or agency of the United States

before submitting to the Congress, or any committee or

subcommittee thereof, any reports, recommendations, testimony, or

comments if such submissions include a statement indicating that

the views expressed therein are those of the Director and do not

necessarily represent the views of the Secretary or the

President.

"(2) Requirement. - If the Director determines at any time that

the Secretary is taking or has taken any action that interferes

with the ability of the Director to carry out the duties of the

Director under this Act [probably means title V of Pub. L.

105-65, see Short Title of 1997 Amendment note set out under

section 1701 of Title 12, Banks and Banking] or that affects the

administration of the program under subtitle A of this Act in a

manner that is inconsistent with the purposes of this Act,

including any proposed action by the Director, in the discretion

of the Director, that is overruled by the Secretary, the Director

shall immediately report directly to the Committee on Financial

Services of the House of Representatives and the Committee on

Banking, Housing, and Urban Affairs of the Senate regarding such

action. Notwithstanding subsection (a) or (b), any determination

or report under this paragraph by the Director shall not be

subject to prior review or approval of the Secretary.

"SEC. 574. PERSONNEL.

"(a) Office Personnel. - The Director may appoint and fix the

compensation of such officers and employees of the Office as the

Director considers necessary to carry out the functions of the

Director and the Office. Officers and employees may be paid without

regard to the provisions of chapter 51 and subchapter III of

chapter 53 of title 5, United States Code, relating to

classification and General Schedule pay rates.

"(b) Comparability of Compensation With Federal Banking Agencies.

- In fixing and directing compensation under subsection (a), the

Director shall consult with, and maintain comparability with

compensation of officers and employees of the Federal Deposit

Insurance Corporation.

"(c) Personnel of Other Federal Agencies. - In carrying out the

duties of the Office, the Director may use information, services,

staff, and facilities of any executive agency, independent agency,

or department on a reimbursable basis, with the consent of such

agency or department.

"(d) Outside Experts and Consultants. - The Director may procure

temporary and intermittent services under section 3109(b) of title

5, United States Code.

"SEC. 575. BUDGET AND FINANCIAL REPORTS.

"(a) Financial Operating Plans and Forecasts. - Before the

beginning of each fiscal year, the Secretary shall submit a copy of

the financial operating plans and forecasts for the Office to the

Director of the Office of Management and Budget.

"(b) Reports of Operations. - As soon as practicable after the

end of each fiscal year and each quarter thereof, the Secretary

shall submit a copy of the report of the results of the operations

of the Office during such period to the Director of the Office of

Management and Budget.

"(c) Inclusion in President's Budget. - The annual plans,

forecasts, and reports required under this section shall be

included: (1) in the Budget of the United States in the appropriate

form; and (2) in the congressional justifications of the Department

of Housing and Urban Development for each fiscal year in a form

determined by the Secretary.

"SEC. 576. LIMITATION ON SUBSEQUENT EMPLOYMENT.

"Neither the Director nor any former officer or employee of the

Office who, while employed by the Office, was compensated at a rate

in excess of the lowest rate for a position classified higher than

GS-15 of the General Schedule under section 5107 of title 5, United

States Code, may, during the 1-year period beginning on the date of

separation from employment by the Office, accept compensation from

any party (other than a Federal agency) having any financial

interest in any mortgage restructuring and rental assistance

sufficiency plan under subtitle A or comparable matter in which the

Director or such officer or employee had direct participation or

supervision.

"SEC. 577. AUDITS BY GAO.

"The Comptroller General shall audit the operations of the Office

in accordance with generally accepted Government auditing

standards. All books, records, accounts, reports, files, and

property belonging to, or used by, the Office shall be made

available to the Comptroller General. Audits under this section

shall be conducted annually for the first 2 fiscal years following

the date of the enactment of this Act [Oct. 27, 1997] and as

appropriate thereafter.

"SEC. 578. OVERSIGHT BY FEDERAL HOUSING COMMISSIONER.

"All authority and responsibilities assigned under this subtitle

to the Secretary shall be carried out through the Assistant

Secretary of the Department of Housing and Urban Development who is

the Federal Housing Commissioner.

"SEC. 579. TERMINATION.

"(a) Repeals. -

"(1) Mark-to-market program. - Subtitle A (except for section

524) is repealed effective October 1, 2006.

"(2) OMHAR. - Subtitle D (except for this section) is repealed

effective October 1, 2004.

"(b) Exception. - Notwithstanding the repeal under subsection

(a), the provisions of subtitle A (as in effect immediately before

such repeal) shall apply with respect to projects and programs for

which binding commitments have been entered into under this Act

before October 1, 2006.

"(c) Termination of Director and Office. - The Office of

Multifamily Housing Assistance Restructuring and the position of

Director of such Office shall terminate at the end of September 30,

2004.

"(d) Transfer of Authority. - Effective upon the repeal of

subtitle D under subsection (a)(2) of this section, all authority

and responsibilities to administer the program under subtitle A are

transferred to the Secretary."

[Pub. L. 107-116, title VI, Sec. 616(a)(2), Jan. 10, 2002, 115

Stat. 2225, provided that: "The amendment made by paragraph (1) of

this subsection [amending section 514 of Pub. L. 105-65, set out

above] is deemed to have taken effect on the date of the enactment

of Public Law 106-74 [Oct. 20, 1999] (113 Stat. 1109)."]

[Pub. L. 107-116, title VI, Sec. 622(b), Jan. 10, 2002, 115 Stat.

2227, provided that: "The amendment made by subsection (a)

[amending section 572(a) of Pub. L. 105-65, set out above] shall

apply to the first Director of the Office of Multifamily Housing

Assistance Restructuring of the Department of Housing and Urban

Development appointed after the date of the enactment of this Act

[Jan. 10, 2002], and any such Director appointed thereafter."]

[Pub. L. 107-116, title VI, Sec. 623(b), Jan. 10, 2002, 115 Stat.

2227, provided that: "The amendment made by subsection (a)

[amending section 572(b) of Pub. L. 105-65, set out above] shall

apply to any vacancy in the position of Director of the Office of

Multifamily Housing Assistance Restructuring of the Department of

Housing and Urban Development which occurs or exists after the date

of the enactment of this Act [Jan. 10, 2002]."]

[Pub. L. 105-276, title V, Sec. 597(c), Oct. 21, 1998, 112 Stat.

2659, provided that: "This section [amending section 524(a)(2) of

Pub. L. 105-65, set out above] shall take effect on, and the

amendments made by this section are made on, and shall apply

beginning upon, the date of the enactment of this Act [Oct. 21,

1998]."]