H.R. 3793 (103rd): Community Enterprise Revitalization Amendments Act

103rd Congress, 1993–1994. Text as of Feb 03, 1994 (Introduced).

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HR 3793 IH

103d CONGRESS

2d Session

H. R. 3793

To provide for the Secretary of Housing and Urban Development to make grants for economic development activities in connection with loan guarantees under section 108 of the Housing and Community Development Act of 1974 to enhance the security of such loans and improve the viability of projects financed with such loans, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

February 3, 1994

Mr. RIDGE introduced the following bill; which was referred to the Committee on Banking, Finance and Urban Affairs


A BILL

To provide for the Secretary of Housing and Urban Development to make grants for economic development activities in connection with loan guarantees under section 108 of the Housing and Community Development Act of 1974 to enhance the security of such loans and improve the viability of projects financed with such loans, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ‘Community Enterprise Revitalization Amendments Act’.

SEC. 2. SECTION 108 ELIGIBLE ACTIVITIES.

    (a) IN GENERAL- Section 108(a) of the Housing and Community Development Act of 1974 (42 U.S.C. 5308(a)) is amended--

      (1) in the first sentence--

        (A) by striking ‘or’ after ‘section 105(a);’; and

        (B) by inserting before the period the following: ‘; (5) the acquisition, construction, reconstruction, or installation of public facilities (except for buildings for the general conduct of government); or (6) in the case of colonias, public works and site or other improvements’; and

      (2) by striking the second sentence and inserting the following: ‘A guarantee under this section (including a guarantee combined with a grant under subsection (q)) may be used to assist a grantee in obtaining financing only if the grantee has made efforts to obtain the financing without the use of the guarantee (and, if applicable, the grant) and cannot complete the financing consistent with the timely execution of the proposed activities and projects without the guarantee (or, if applicable, the grant).’.

    (b) DEFINITION- Section 102(a) of the Housing and Community Development Act of 1974 (42 U.S.C. 5302(a)) is amended by adding at the end the following new paragraph:

      ‘(24) The term ‘colonia’ means any identifiable community that--

        ‘(A) is in the State of Arizona, California, New Mexico, or Texas;

        ‘(B) is in the United States-Mexico border region;

        ‘(C) is determined to be a colonia on the basis of objective criteria, including lack of potable water supply, lack of adequate sewage systems, and lack of decent, safe, and sanitary housing; and

        ‘(D) was in existence as a colonia before the date of the enactment of the Cranston-Gonzalez National Affordable Housing Act.’.

SEC. 3. ECONOMIC DEVELOPMENT GRANTS.

    (a) IN GENERAL- Section 108 of the Housing and Community Development Act of 1974 (42 U.S.C. 5308) is amended by adding at the end the following new subsection:

    ‘(q) ECONOMIC DEVELOPMENT GRANTS-

      ‘(1) AUTHORIZATION- The Secretary may make grants in connection with notes or other obligations guaranteed under this section to eligible public entities for the purpose of enhancing the security of loans guaranteed under this section or improving the viability of projects financed with loans guaranteed under this section.

      ‘(2) ELIGIBLE ACTIVITIES- Assistance under this subsection may be used for the purposes of and in conjunction with projects and activities assisted under subsection (a).

      ‘(3) APPLICATIONS- Applications for assistance under this subsection shall be submitted by eligible public entities in the form and in accordance with the procedures established by the Secretary. Eligible public entities may apply for grants only in conjunction with a request for guarantee under subsection (a).

      ‘(4) SELECTION CRITERIA- The Secretary shall establish criteria for awarding assistance under this subsection. Such criteria shall include--

        ‘(A) the extent of need for such assistance;

        ‘(B) the level of distress in the community to be served and in the jurisdiction applying for assistance;

        ‘(C) the quality of the plan proposed and the capacity or potential capacity of the applicant to successfully carry out the plan; and

        ‘(D) such other factors as the Secretary determines to be appropriate.’.

    (b) CONFORMING AMENDMENT- Title I of the Housing and Community Development Act of 1974 (42 U.S.C. 5301 et seq.) is amended--

      (1) in section 101(c) in the second sentence, by inserting ‘or a grant’ after ‘guarantee’; and

      (2) in section 104(b)(3), by inserting ‘or a grant’ after ‘guarantee’.

SEC. 4. USE OF UDAG RECAPTURES.

    Section 119(o) of the Housing and Community Development Act of 1974 (42 U.S.C. 5318(o)) is amended by inserting before the period the following: ‘, except that amounts available to the Secretary for use under this subsection as of October 1, 1993, and amounts released to the Secretary pursuant to subsection (t) may, to the extent or in such amounts as are or have been provided in appropriation Acts, be used to provide grants under section 108(q).’.

SEC. 5. UDAG AMNESTY PROGRAM.

    (a) AMENDMENT- Section 119 of the Housing and Community Development Act of 1974 (42 U.S.C. 5318) is amended by adding at the end the following new subsection:

    ‘(t) UDAG AMNESTY PROGRAM- If a grant or a portion of a grant under this section remains unexpended as of the issuance of a notice implementing this subsection, the grantee may enter into an agreement, as provided under this subsection, with the Secretary to receive a percentage of the grant amount and relinquish all claims to the balance of the grant within 90 days of the issuance of notice implementing this subsection (or such later date as the Secretary may approve). The Secretary shall not recapture any funds obligated pursuant to this section during a period beginning on the date of enactment of the Housing and Community Development Act of 1993 until 90 days after the issuance of a notice implementing this subsection. A grantee may receive as a grant under this subsection--

      ‘(1) 33 percent of such unexpended amounts if--

        ‘(A) the grantee agrees to expend not less than one-half of the amount received for activities authorized pursuant to section 108(q) and to expend such funds in conjunction with a loan guarantee made under section 108 at least equal to twice the amount of the funds received; and

        ‘(B)(i) the remainder of the amount received is used for economic development activities eligible under title I of this Act; and

        ‘(ii) except when waived by the Secretary in the case of a severely distressed jurisdiction, not more than one-half of the costs of activities under subparagraph (B) are derived from such unexpended amounts; or

      ‘(2) 25 percent of such unexpended amounts if--

        ‘(A) the grantee agrees to expend such funds for economic development activities eligible under title I of this Act; and

        ‘(B) except when waived by the Secretary in the case of a severely distressed jurisdiction, not more than one-half of the costs of such activities are derived from such unexpended amount.’.

    (b) IMPLEMENTATION- Notwithstanding section 7, not later than 10 days after the date of enactment of this Act, the Secretary shall, by notice published in the Federal Register, which shall take effect upon publication, establish such requirements as may be necessary to implement the amendments made by this section.

SEC. 6. GUARANTEE OF OBLIGATIONS BACKED BY SECTION 108 LOANS.

    Section 108 of the Housing and Community Development Act of 1974 (42 U.S.C. 5308), as amended by section 3, is amended by adding at the end the following new subsection:

    ‘(r) GUARANTEE OF OBLIGATIONS BACKED BY SECTION 108 LOANS-

      ‘(1) AUTHORIZATION- The Secretary may, upon such terms and conditions as the Secretary deems appropriate, guarantee the timely payment of the principal of and interest on trust certificates or other obligations that--

        ‘(A) are offered by the Secretary, or by any other offeror approved for purposes of this subsection by the Secretary; and

        ‘(B) are based on and backed by a trust or pool composed of notes or other obligations guaranteed by the Secretary under this section.

      ‘(2) FULL FAITH AND CREDIT OF THE UNITED STATES- Subsection (f) shall apply to any guarantee under this subsection.

      ‘(3) SUBROGATION- If the Secretary pays a claim under a guarantee issued under this section, the Secretary shall be subrogated fully to the rights satisfied by such payment.

      ‘(4) POWERS OF THE SECRETARY- No Federal, State, or local law shall preclude or limit the exercise by the Secretary of--

        ‘(A) the power to contract with respect to public offerings and other sales of notes, trust certificates, and other obligations guaranteed under this section upon such terms and conditions as the Secretary deems appropriate;

        ‘(B) the right to enforce by any means deemed appropriate by the Secretary any such contract; and

        ‘(C) the Secretary’s ownership rights, as applicable, in notes, certificates, or other obligations guaranteed under this section, or constituting the trust or pool against which trust certificates or other obligations guaranteed under this section are offered.’.

SEC. 7. EFFECTIVE DATE.

    The Secretary shall, by notice published in the Federal Register, which shall take effect upon publication, establish such requirements as may be necessary to implement the amendments made by this Act. The notice shall invite public comments and, not later than 12 months after the date on which the notice is published, the Secretary shall issue final regulations based on the initial notice, taking into account any public comments received.