< Back to S. 1299 (103rd Congress, 1993–1994)

Text of the Multifamily Housing Property Disposition Reform Act of 1994

This bill was enacted after being signed by the President on April 11, 1994. The text of the bill below is as of Nov 19, 1993 (Passed the Senate (Engrossed)).

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S 1299 ES

103d CONGRESS

1st Session

S. 1299


AN ACT

To reform requirements for the disposition of multifamily property owned by the Secretary of Housing and Urban Development, enhance program flexibility, authorize a program to combat crime, 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 ‘Housing and Community Development Act of 1993’.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

      Sec. 1. Short title.

      Sec. 2. Table of contents.

      Sec. 3. Definitions.

TITLE I--FHA MULTIFAMILY REFORMS

      Sec. 101. Multifamily property disposition.

      Sec. 102. Repeal of State agency multifamily property disposition demonstration.

      Sec. 103. RTC marketing and disposition of multifamily projects owned by HUD.

      Sec. 104. Civil money penalties against general partners and certain managing agents of multifamily housing projects.

      Sec. 105. Models for property disposition.

      Sec. 106. Preventing mortgage defaults.

      Sec. 107. Interest rates on assigned mortgages.

      Sec. 108. Authorization of appropriations.

TITLE II--ENHANCED PROGRAM FLEXIBILITY

Subtitle A--Office of Public and Indian Housing

      Sec. 201. Revitalization of severely distressed public housing.

      Sec. 202. Disallowance of earned income for residents who obtain employment.

      Sec. 203. Ceiling rents based on reasonable rental value.

      Sec. 204. Resident management program.

Subtitle B--Office of Community Planning and Development

      Sec. 211. Economic development initiative.

      Sec. 212. HOME investment partnerships.

      Sec. 213. HOPE match requirement.

      Sec. 214. Flexibility of CDBG program for disaster areas.

      Sec. 215. Flexibility of HOME program for disaster areas.

Subtitle C--Community Partnerships Against Crime

      Sec. 221. COMPAC program.

TITLE III--TECHNICAL AND OTHER AMENDMENTS

Subtitle A--Public and Assisted Housing

      Sec. 301. Correction to definition of family.

      Sec. 302. Identification of CIAP replacement needs.

      Sec. 303. Applicability of public housing amendments to Indian housing.

      Sec. 304. Project-based accounting.

      Sec. 305. Operating subsidy adjustments for anticipated fraud recoveries.

      Sec. 306. Technical assistance for lead hazard reduction grantees.

      Sec. 307. Environmental review in connection with grants for lead-based paint hazard reduction.

      Sec. 308. Fire safety in federally assisted housing.

      Sec. 309. Section 23 conversion projects.

      Sec. 310. Indemnification of contractors for intellectual property rights disputes.

      Sec. 311. Assumption of environmental review responsibilities under United States Housing Act of 1937 programs.

      Sec. 312. Increased State flexibility in the Low-Income Home Energy Assistance Program.

Subtitle B--Multifamily Housing

      Sec. 321. Correction of multifamily mortgage limits.

      Sec. 322. FHA multifamily risk-sharing; HFA pilot program amendments.

      Sec. 323. Subsidy layering review.

Subtitle C--Miscellaneous and Technical Amendments

      Sec. 331. Technical correction to rural housing preservation program.

      Sec. 332. CDBG technical amendment.

      Sec. 333. Environmental review in connection with special projects.

TITLE IV--GENERAL PROVISIONS

      Sec. 401. Mount Rushmore Commemorative Coin Act.

      Sec. 402. Minority community development grants for communities with special needs.

SEC. 3. DEFINITIONS.

    As used in this Act--

      (1) the term ‘FHA’ means the Federal Housing Administration;

      (2) the term ‘Secretary’ means the Secretary of Housing and Urban Development; and

      (3) the term ‘RTC’ means the Resolution Trust Corporation.

TITLE I--FHA MULTIFAMILY REFORMS

SEC. 101. MULTIFAMILY PROPERTY DISPOSITION.

    (a) FINDINGS- The Congress finds that--

      (1) the portfolio of multifamily housing project mortgages insured by the FHA is severely troubled and at risk of default, requiring the Secretary to increase loss reserves from $5.5 billion in 1991 to $11.9 billion in 1992 to cover estimated future losses;

      (2) the inventory of multifamily housing projects owned by the Secretary has more than tripled since 1989, and, by the end of 1993, may exceed 75,000 units;

      (3) the cost to the Federal Government of owning and maintaining multifamily housing projects escalated to approximately $250 million in fiscal year 1992;

      (4) the inventory of multifamily housing projects subject to mortgages held by the Secretary has increased dramatically, to more than 2,400 mortgages, and approximately half of these mortgages, secured by projects with over 230,000 units, are delinquent;

      (5) the inventory of insured and formerly insured multifamily housing projects is rapidly deteriorating, endangering tenants and neighborhoods;

      (6) over 5 million very low-income families today have a critical need for housing that is affordable and habitable; and

      (7) the current statutory framework governing the disposition of multifamily housing projects effectively impedes the Government’s ability to dispose of properties, protect tenants, and ensure that projects are maintained over time.

    (b) MANAGEMENT AND DISPOSITION OF MULTIFAMILY HOUSING PROJECTS- Section 203 of the Housing and Community Development Amendments of 1978 (12 U.S.C. 1701z-11) is amended to read as follows:

‘SEC. 203. MANAGEMENT AND DISPOSITION OF MULTIFAMILY HOUSING PROJECTS.

    ‘(a) GOALS- The Secretary of Housing and Urban Development (hereafter in this section referred to as the ‘Secretary’) shall manage or dispose of multifamily housing projects that are owned by the Secretary or that are subject to a mortgage held by the Secretary in a manner that--

      ‘(1) is consistent with the National Housing Act and this section;

      ‘(2) will protect the financial interests of the Federal Government; and

      ‘(3) will, in the least costly fashion among reasonable available alternatives, further the goals of--

        ‘(A) preserving housing so that it can remain available to and affordable by low-income persons;

        ‘(B) preserving and revitalizing residential neighborhoods;

        ‘(C) maintaining existing housing stock in a decent, safe, and sanitary condition;

        ‘(D) minimizing the involuntary displacement of tenants;

        ‘(E) maintaining housing for the purpose of providing rental housing, cooperative housing, and homeownership opportunities for low-income persons; and

        ‘(F) minimizing the need to demolish multifamily housing projects.

    The Secretary, in determining the manner in which a project is to be managed or disposed of, shall balance competing goals relating to individual projects in a manner that will further the purposes of this section.

    ‘(b) DEFINITIONS- For purposes of this section, the following definitions shall apply:

      ‘(1) MULTIFAMILY HOUSING PROJECT- The term ‘multifamily housing project’ means any multifamily rental housing project that is, or prior to acquisition by the Secretary was, assisted or insured under the National Housing Act, or was subject to a loan under section 202 of the Housing Act of 1959.

      ‘(2) SUBSIDIZED PROJECT- The term ‘subsidized project’ means a multifamily housing project receiving any of the following types of assistance immediately prior to the assignment of the mortgage on such project to, or the acquisition of such mortgage by, the Secretary:

        ‘(A) Below market interest rate mortgage insurance under the proviso of section 221(d)(5) of the National Housing Act.

        ‘(B) Interest reduction payments made in connection with mortgages insured under section 236 of the National Housing Act.

        ‘(C) Direct loans made under section 202 of the Housing Act of 1959.

        ‘(D) Assistance in the form of--

          ‘(i) rent supplement payments under section 101 of the Housing and Urban Development Act of 1965;

          ‘(ii) additional assistance payments under section 236(f)(2) of the National Housing Act;

          ‘(iii) housing assistance payments made under section 23 of the United States Housing Act of 1937 (as in effect before January 1, 1975); or

          ‘(iv) housing assistance payments made under section 8 of the United States Housing Act of 1937 (excluding payments made for tenant-based assistance under section 8);

        if (except for purposes of section 183(c) of the Housing and Community Development Act of 1987) such assistance payments are made to more than 50 percent of the units in the project.

      ‘(3) FORMERLY SUBSIDIZED PROJECT- The term ‘formerly subsidized project’ means a multifamily housing project owned by the Secretary that was a subsidized project immediately prior to its acquisition by the Secretary.

      ‘(4) UNSUBSIDIZED PROJECT- The term ‘unsubsidized project’ means a multifamily housing project owned by the Secretary that is not a subsidized project or a formerly subsidized project.

    ‘(c) MANAGEMENT OR DISPOSITION OF PROPERTY-

      ‘(1) DISPOSITION TO PURCHASERS- The Secretary is authorized, in carrying out this section, to dispose of a multifamily housing project owned by the Secretary on a negotiated, competitive bid, or other basis, on such terms as the Secretary deems appropriate considering the low-income character of the project and the requirements of subsection (a), to a purchaser determined by the Secretary to be capable of--

        ‘(A) satisfying the conditions of the disposition plan;

        ‘(B) implementing a sound financial and physical management program that is designed to enable the project to meet anticipated operating and repair expenses to ensure that the project will remain in decent, safe, and sanitary condition;

        ‘(C) responding to the needs of the tenants and working cooperatively with tenant organizations;

        ‘(D) providing adequate organizational, staff, and financial resources to the project; and

        ‘(E) meeting such other requirements as the Secretary may determine.

      ‘(2) CONTRACTING FOR MANAGEMENT SERVICES- The Secretary is authorized, in carrying out this section--

        ‘(A) to contract for management services for a multifamily housing project that is owned by the Secretary (or for which the Secretary is mortgagee in possession), on a negotiated, competitive bid, or other basis at a price determined by the Secretary to be reasonable, with a manager the Secretary has determined is capable of--

          ‘(i) implementing a sound financial and physical management program that is designed to enable the project to meet anticipated operating and maintenance expenses to ensure that the project will remain in decent, safe, and sanitary condition;

          ‘(ii) responding to the needs of the tenants and working cooperatively with tenant organizations;

          ‘(iii) providing adequate organizational, staff, and other resources to implement a management program; and

          ‘(iv) meeting such other requirements as the Secretary may determine; and

        ‘(B) to require the owner of a multifamily housing project that is subject to a mortgage held by the Secretary to contract for management services for the project in the manner described in subparagraph (A).

      ‘(3) FORECLOSURE SALE- In carrying out this section, the Secretary shall--

        ‘(A) prior to foreclosing on any multifamily housing project held by the Secretary, notify both the unit of general local government in which the property is located and the tenants of the property of the proposed foreclosure sale; and

        ‘(B) upon disposition of a multifamily housing project through a foreclosure sale, determine that the purchaser is capable of implementing a sound financial and physical management program that is designed to enable the project to meet anticipated operating and repair expenses to ensure that the project will remain in decent, safe, and sanitary condition.

    ‘(d) MAINTENANCE OF HOUSING PROJECTS-

      ‘(1) HOUSING PROJECTS OWNED BY THE SECRETARY- In the case of multifamily housing projects that are owned by the Secretary (or for which the Secretary is mortgagee in possession), the Secretary shall--

        ‘(A) to the greatest extent possible, maintain all such occupied projects in a decent, safe, and sanitary condition;

        ‘(B) to the greatest extent possible, maintain full occupancy in all such projects; and

        ‘(C) maintain all such projects for purposes of providing rental or cooperative housing.

      ‘(2) HOUSING PROJECTS SUBJECT TO A MORTGAGE HELD BY THE SECRETARY- In the case of any multifamily housing project that is subject to a mortgage held by the Secretary, the Secretary shall require the owner of the project to carry out the requirements of paragraph (1).

    ‘(e) REQUIRED ASSISTANCE- In carrying out the goals specified in subsection (a), the Secretary shall take not less than one of the following actions:

      ‘(1) CONTRACT WITH OWNER- Enter into contracts under section 8 of the United States Housing Act of 1937, to the extent budget authority is available, with owners of multifamily housing projects that are acquired by a purchaser other than the Secretary at foreclosure or after sale by the Secretary.

        ‘(A) SUBSIDIZED OR FORMERLY SUBSIDIZED PROJECTS RECEIVING CERTAIN ASSISTANCE- In the case of a subsidized project referred to in subparagraph (A), (B), or (C) of subsection (b)(2) or a formerly subsidized project that was subsidized as described in any such subparagraph--

          ‘(i) the contract shall be sufficient to assist at least all units covered by an assistance contract under any of the authorities referred to in subsection (b)(2)(D) before acquisition, unless the Secretary acts pursuant to the provisions of subparagraph (C) of this paragraph;

          ‘(ii) in the case of units requiring project-based rental assistance pursuant to clause (i) that are occupied by families who are not eligible for assistance under section 8, a contract under this subparagraph shall also provide that when a vacancy occurs, the owner shall lease the available unit to a family eligible for assistance under section 8; and

          ‘(iii) the Secretary shall take actions to ensure the availability and affordability, as defined in paragraph (3)(B), for the remaining useful life of the project, as defined by the Secretary, of any unit located in any project referred to in subparagraph (A), (B), or (C) of subsection (b)(2) that does not otherwise receive project-based rental assistance under this subparagraph. To carry out this clause, the Secretary may require purchasers to establish use or rent restrictions on these units.

        ‘(B) SUBSIDIZED OR FORMERLY SUBSIDIZED PROJECTS RECEIVING OTHER ASSISTANCE- In the case of a subsidized project referred to in subsection (b)(2)(D) or a formerly subsidized project that was subsidized as described in subsection (b)(2)(D)--

          ‘(i) the contract shall be sufficient to assist at least all units in the project that are covered, or that were covered immediately before foreclosure on or acquisition of the project by the Secretary, by an assistance contract under any of the authorities referred to in such subsection, unless the Secretary acts pursuant to provisions of subparagraph (C); and

          ‘(ii) in the case of units requiring project-based rental assistance pursuant to clause (i) that are occupied by families who are not eligible for assistance under section 8, a contract under this paragraph shall also provide that when a vacancy occurs, the owner shall lease the available unit to a family eligible for assistance under section 8.

        ‘(C) EXCEPTIONS TO SUBPARAGRAPHS (A) AND (B)- In lieu of providing project-based rental assistance under subparagraph (A) or (B), the Secretary may require certain units in unsubsidized projects to contain use restrictions providing that such units will be available to and affordable by very low-income families for the remaining useful life of the project, as defined by the Secretary, if--

          ‘(i) the Secretary matches any reduction in the number of units otherwise required to be assisted with project-based rental assistance under subparagraph (A) or (B) with at least an equivalent increase in the number of units made affordable, as such term is defined in paragraph (3)(B), to very low-income persons within unsubsidized projects;

          ‘(ii) the Secretary makes tenant-based assistance under section 8 available to low-income tenants residing in units otherwise requiring project-based rental assistance under subparagraph (A) or (B) upon disposition; and

          ‘(iii) the units described in clause (i) are located within the same market area.

        ‘(D) CONTRACT REQUIREMENTS FOR UNSUBSIDIZED PROJECTS- Notwithstanding actions that are taken pursuant to subparagraph (C), in any unsubsidized project--

          ‘(i) the contract shall be at least sufficient to provide project-based rental assistance for all units that are covered or were covered immediately before foreclosure or acquisition by an assistance contract under--

            ‘(I) section 8(b)(2) of the United States Housing Act of 1937, as such section existed before October 1, 1983 (new construction and substantial rehabilitation); section 8(b) of such Act (property disposition); section 8(d)(2) of such Act (project-based certificates); section 8(e)(2) of such Act (moderate rehabilitation); section 23 of such Act (as in effect before January 1, 1975); or section 101 of the Housing and Urban Development Act of 1965 (rent supplements); or

            ‘(II) section 8 of the United States Housing Act of 1937, following conversion from section 101 of the Housing and Urban Development Act of 1965; and

          ‘(ii) the Secretary shall make available tenant-based assistance under section 8 of the United States Housing Act of 1937 to tenants currently residing in units that were covered by an assistance contract under the Loan Management Set-Aside program under section 8(b) of the United States Housing Act of 1937 immediately before foreclosure or acquisition of the project by the Secretary.

      ‘(2) ANNUAL CONTRIBUTION CONTRACTS- In the case of multifamily housing projects that are acquired by a purchaser other than the Secretary at foreclosure or after sale by the Secretary, enter into annual contribution contracts with public housing agencies to provide tenant-based assistance under section 8 of the United States Housing Act of 1937 to all low-income families who are otherwise eligible for assistance, in accordance with the requirements of subparagraph (A), (B), or (D) of paragraph (1), on the date that the project is acquired by the purchaser. The Secretary shall take action under this paragraph only after making a determination that there is an adequate supply of habitable housing in the area that is available to and affordable by low-income families using such assistance. With respect to subsidized or formerly subsidized projects, actions may be taken pursuant to this paragraph in connection with not more than 10 percent of the aggregate number of units in subsidized or formerly subsidized projects disposed of by the Secretary in each fiscal year.

      ‘(3) OTHER ASSISTANCE-

        ‘(A) IN GENERAL- In accordance with the authority provided under the National Housing Act, reduce the selling price, apply use or rent restrictions on certain units, or provide other financial assistance to the owners of multifamily housing projects that are acquired by a purchaser other than the Secretary at foreclosure, or after sale by the Secretary, on terms that will ensure that at least those units otherwise required to receive project-based section 8 assistance pursuant to subparagraph (A), (B), or (D) of paragraph (1) are available to and affordable by low-income persons for the remaining useful life of the project, as defined by the Secretary.

        ‘(B) DEFINITION- A unit shall be considered affordable under this paragraph if--

          ‘(i) for very low-income tenants, the rent for such unit does not exceed 30 percent of 50 percent of the area median income, as determined by the Secretary, with adjustments for family size; and

          ‘(ii) for low-income tenants other than very low-income tenants, the rent for such unit does not exceed 30 percent of 80 percent of the area median income, as determined by the Secretary, with adjustments for family size.

        ‘(C) VERY LOW-INCOME TENANTS- The Secretary shall provide assistance under section 8 of the United States Housing Act of 1937 to any very low-income tenant currently residing in a unit otherwise required to receive project-based rental assistance under section 8, pursuant to subparagraph (A), (B), or (D) of paragraph (1), if the rents charged such tenants as a result of actions taken pursuant to this paragraph exceed the amount payable as rent under section 3(a) of the United States Housing Act of 1937.

      ‘(4) TRANSFER FOR USE UNDER OTHER PROGRAMS OF THE SECRETARY-

        ‘(A) IN GENERAL- Enter into an agreement providing for the transfer of a multifamily housing project--

          ‘(i) to a public housing agency for use of the project as public housing; or

          ‘(ii) to an owner or another appropriate entity for use of the project under section 202 of the Housing Act of 1959 or under section 811 of the Cranston-Gonzalez National Affordable Housing Act.

        ‘(B) REQUIREMENTS FOR AGREEMENT- The agreement described in subparagraph (A) shall--

          ‘(i) contain such terms, conditions, and limitations as the Secretary determines appropriate, including requirements to assure use of the project under the public housing, section 202, and section 811 programs; and

          ‘(ii) ensure that no current tenant will be displaced as a result of actions taken under this paragraph.

    ‘(f) OTHER ASSISTANCE- In addition to the actions required by subsection (e), the Secretary may take any of the following actions:

      ‘(1) SHORT-TERM LOANS- Provide short-term loans to facilitate the sale of multifamily housing projects to nonprofit organizations or to public agencies if--

        ‘(A) authority for such loans is provided in advance in an appropriations Act;

        ‘(B) such loans are for a term of not more than 5 years;

        ‘(C) the Secretary is presented with satisfactory documentation, evidencing a commitment of permanent financing to replace such short-term loan, from a lender who meets standards set forth by the Secretary; and

        ‘(D) the terms of such loans are consistent with prevailing practices in the marketplace or the provision of such loans results in no cost to the Government, as defined in section 502 of the Congressional Budget Act.

      ‘(2) TENANT-BASED ASSISTANCE- Make available tenant-based assistance under section 8 of the United States Housing Act of 1937 to very low-income families that do not otherwise qualify for project-based rental assistance.

      ‘(3) ALTERNATIVE USES-

        ‘(A) IN GENERAL- Notwithstanding any other provision of law, and subject to notice to and comment from existing tenants, allow not more than--

          ‘(i) 5 percent of the total number of units in multifamily housing projects that are disposed of by the Secretary during each fiscal year to be made available for uses other than rental or cooperative housing, including low-income homeownership opportunities, community space, office space for tenant or housing-related service providers or security programs, or small business uses, if such uses benefit the tenants of the project; and

          ‘(ii) 5 percent of the total number of units in multifamily housing projects that are disposed of by the Secretary during each fiscal year to be used in any manner, if the Secretary and the unit of general local government or area-wide governing body determine that such use will further fair housing, community development, or neighborhood revitalization goals.

        ‘(B) DISPLACEMENT PROTECTION- The Secretary shall--

          ‘(i) make available tenant-based assistance under section 8 of the United States Housing Act of 1937 to any tenant displaced as a result of actions taken by the Secretary pursuant to subparagraph (A); and

          ‘(ii) take such actions as the Secretary determines necessary to ensure the successful use of any tenant-based assistance provided under this subparagraph.

      ‘(4) AUTHORIZATION OF USE OR RENT RESTRICTIONS IN UNSUBSIDIZED PROJECTS- In carrying out the goals specified in subsection (a), the Secretary may require certain units in unsubsidized projects upon disposition to contain use or rent restrictions providing that such units will be available to and affordable by very low-income persons for the remaining useful life of the property, as defined by the Secretary.

    ‘(g) CONTRACT REQUIREMENTS-

      ‘(1) CONTRACT TERM-

        ‘(A) IN GENERAL- Contracts for project-based rental assistance under section 8 of the United States Housing Act of 1937 provided pursuant to this section shall be for a term of not more than 15 years; and

        ‘(B) CONTRACT TERM OF LESS THAN 15 YEARS- To the extent that units receive project-based rental assistance for a contract term of less than 15 years, the Secretary shall require that rents charged to tenants for such units shall not exceed the amount payable for rent under section 3(a) of the United States Housing Act of 1937 for a period of at least 15 years.

      ‘(2) CONTRACT RENT-

        ‘(A) IN GENERAL- The Secretary shall set contract rents for section 8 project-based rental contracts issued under this section at levels that, in conjunction with other resources available to the purchaser, provide for the necessary costs of rehabilitation of such project and do not exceed the percentage of the existing housing fair market rents for the area, as determined by the Secretary under section 8(c) of the United States Housing Act of 1937.

        ‘(B) UP-FRONT GRANTS- If such an approach is determined to be more cost-effective, the Secretary may utilize the budget authority provided for project-based section 8 contracts issued under this section to

          ‘(i) provide project-based section 8 rental assistance; and

          ‘(ii) provide up-front grants for the necessary costs of rehabilitation.

    ‘(h) DISPOSITION PLAN-

      ‘(1) IN GENERAL- Prior to the sale of a multifamily housing project that is owned by the Secretary, the Secretary shall develop a disposition plan for the project that specifies the minimum terms and conditions of the Secretary for disposition of the project, the initial sales price that is acceptable to the Secretary, and the assistance that the Secretary plans to make available to a prospective purchaser in accordance with this section. The initial sales price shall reflect the intended use of the property after sale.

      ‘(2) COMMUNITY AND TENANT INPUT INTO DISPOSITION PLANS AND SALES-

        ‘(A) IN GENERAL- In carrying out this section, the Secretary shall develop procedures to obtain appropriate and timely input into disposition plans from officials of the unit of general local government affected, the community in which the project is situated, and the tenants of the project.

        ‘(B) TENANT ORGANIZATIONS- The Secretary shall develop procedures to facilitate, where feasible and appropriate, the sale of multifamily housing projects to existing tenant organizations with demonstrated capacity or to public or nonprofit entities that represent or are affiliated with existing tenant organizations.

        ‘(C) TECHNICAL ASSISTANCE-

          ‘(i) IN GENERAL- To carry out the procedures developed under subparagraphs (A) and (B), the Secretary is authorized to provide technical assistance, directly or indirectly.

          ‘(ii) TECHNICAL ASSISTANCE PROVIDERS- Recipients of technical assistance funding under the Emergency Low Income Housing Preservation Act of 1987, the Low-Income Housing Preservation and Resident Homeownership Act of 1990, subtitle B of title IV of the Cranston-Gonzalez National Affordable Housing Act, shall be permitted to provide technical assistance to the extent of such funding under any of such programs or under this section, notwithstanding the source of funding.

          ‘(iii) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated $5,000,000 to carry out this subparagraph. In addition, the Secretary is authorized to use amounts appropriated for technical assistance under the Emergency Low Income Housing Preservation Act of 1987, the Low-Income Housing Preservation and Resident Homeownership Act of 1990, subtitle B of title IV of the Cranston-Gonzalez National Affordable Housing Act, for the provision of technical assistance under this section.

    ‘(i) RIGHT OF FIRST REFUSAL-

      ‘(1) PROCEDURE-

        ‘(A) NOTIFICATION BY SECRETARY OF THE ACQUISITION OF TITLE- Not later than 30 days after the Secretary acquires title to a multifamily housing project, the Secretary shall notify the appropriate unit of general local government and State agency or agencies designated by the Governor of the acquisition of such title.

        ‘(B) EXPRESSION OF INTEREST- Not later than 45 days after receiving notification from the Secretary under subparagraph (A), the unit of general local government or designated State agency may submit to the Secretary a preliminary expression of interest in the project. The Secretary may take such actions as may be necessary to require the unit of general local government or designated State agency to substantiate such interest.

        ‘(C) TIMELY EXPRESSION OF INTEREST- If the unit of general local government or designated State agency has expressed interest in the project before the expiration of the 45-day period referred to in subparagraph (B) and has substantiated such interest if requested, the Secretary shall notify the unit of general local government or designated State agency, within a reasonable period of time, of the terms and conditions of the disposition plan, in accordance with subsection (h). The Secretary shall then give the unit of general local government or designated State agency not more than 90 days after the date of such notification to make an offer to purchase the project.

        ‘(D) NO TIMELY EXPRESSION OF INTEREST- If the unit of general local government or designated State agency does not express interest before the expiration of the 45-day period referred to in subparagraph (B), or does not substantiate an expressed interest if requested, the Secretary may offer the project for sale to any interested person or entity.

      ‘(2) ACCEPTANCE OF OFFERS- If the Secretary has given the unit of general local government or designated State agency 90 days to make an offer to purchase the project, the Secretary shall accept an offer that complies with the terms and conditions of the disposition plan. The Secretary may accept an offer that does not comply with the terms and conditions of the disposition plan if the Secretary determines that the offer will further the goals specified in subsection (a) by actions that include extension of the duration of low-income affordability restrictions or otherwise restructuring the transaction in a manner that enhances the long-term affordability for low-income persons. The Secretary shall, in particular, have discretion to reduce the initial sales price in exchange for the extension of low-income affordability restrictions beyond the period of assistance contemplated by the attachment of assistance pursuant to subsection (e) or for an increase in the number of units that are available to and affordable by low-income families. If the Secretary and the unit of general local government or designated State agency cannot reach agreement within 90 days, the Secretary may offer the project for sale to the general public.

      ‘(3) PURCHASE BY UNIT OF GENERAL LOCAL GOVERNMENT OR DESIGNATED STATE AGENCY- Notwithstanding any other provision of law, a unit of general local government (including a public housing agency) or designated State agency may purchase multifamily housing projects in accordance with this subsection.

      ‘(4) APPLICABILITY- This subsection shall apply to projects that are acquired on or after the effective date of this subsection. With respect to projects acquired before such effective date, the Secretary may apply--

        ‘(A) the requirements of paragraphs (2) and (3) of section 203(e) as such paragraphs existed immediately before the effective date of this subsection; or

        ‘(B) the requirements of paragraphs (1) and (2) of this subsection, if the Secretary gives the unit of general local government or designated State agency--

          ‘(i) 45 days to express interest in the project; and

          ‘(ii) if the unit of general local government or designated State agency expresses interest in the project before the expiration of the 45-day period, and substantiates such interest if requested, 90 days from the date of notification of the terms and conditions of the disposition plan to make an offer to purchase the project.

    ‘(j) DISPLACEMENT OF TENANTS AND RELOCATION ASSISTANCE-

      ‘(1) IN GENERAL- Whenever tenants will be displaced as a result of the demolition of, repairs to, or conversion in the use of, a multifamily housing project that is owned by the Secretary (or for which the Secretary is mortgagee in possession), the Secretary shall identify tenants who will be displaced, and shall notify all such tenants of their pending displacement and of any relocation assistance that may be available. In the case of a multifamily housing project that is subject to a mortgage held by the Secretary, the Secretary shall require the owner of the project to carry out the requirements of this paragraph, if the Secretary has authorized the demolition of, repairs to, or conversion in the use of such multifamily housing project.

      ‘(2) RIGHTS OF DISPLACED TENANTS- The Secretary shall assure for any such tenant (who continues to meet applicable qualification standards) the right--

        ‘(A) to return, whenever possible, to a repaired unit;

        ‘(B) to occupy a unit in another multifamily housing project owned by the Secretary;

        ‘(C) to obtain housing assistance under the United States Housing Act of 1937; or

        ‘(D) to receive any other available relocation assistance as the Secretary determines to be appropriate.

    ‘(k) MORTGAGE AND PROJECT SALES-

      ‘(1) IN GENERAL- The Secretary may not approve the sale of any loan or mortgage held by the Secretary (including any loan or mortgage owned by the Government National Mortgage Association) on any subsidized project or formerly subsidized project, unless such sale is made as part of a transaction that will ensure that such project will continue to operate at least until the maturity date of such loan or mortgage, in a manner that will provide rental housing on terms at least as advantageous to existing and future tenants as the terms required by the program under which the loan or mortgage was made or insured prior to the assignment of the loan or mortgage on such project to the Secretary.

      ‘(2) SALE OF CERTAIN PROJECTS- The Secretary may not approve the sale of any subsidized project--

        ‘(A) that is subject to a mortgage held by the Secretary; or

        ‘(B) if the sale transaction involves the provision of any additional subsidy funds by the Secretary or a recasting of the mortgage;

      unless such sale is made as part of a transaction that will ensure that such project will continue to operate at least until the maturity date of the loan or mortgage, in a manner that will provide rental housing on terms at least as advantageous to existing and future tenants as the terms required by the program under which the loan or mortgage was made or insured prior to the proposed sale of the project.

      ‘(3) MORTGAGE SALES TO STATE AND LOCAL GOVERNMENTS- Notwithstanding any provision of law that may require competitive sales or bidding, the Secretary may carry out negotiated sales of mortgages held by the Secretary that are secured by subsidized, unsubsidized, or formerly subsidized multifamily housing projects, without the competitive selection of purchasers or intermediaries, to units of general local government or State agencies, or groups of investors that include at least 1 such unit of general local government or State agency, if the negotiations are conducted with such agencies, except that--

        ‘(A) the terms of any such sale shall include the agreement of the purchasing agency or unit of local government or State agency to act as mortgagee or owner of a beneficial interest in such mortgages, in a manner consistent with maintaining the projects that are subject to such mortgages for occupancy by the general tenant group intended to be served by the applicable mortgage insurance program, including, to the extent the Secretary determines appropriate, authorizing such unit of local government or State agency to enforce the provisions of any regulatory agreement or other program requirements applicable to the related projects; and

        ‘(B) the sales prices for such mortgages shall be, in the determination of the Secretary, the best prices that may be obtained for such mortgages from a unit of general local government or State agency, consistent with the expectation and intention that the projects financed will be retained for use under the applicable mortgage insurance program for the life of the initial mortgage insurance contract.

      ‘(4) SALE OF MORTGAGES COVERING UNSUBSIDIZED PROJECTS- Notwithstanding any other provision of law, the Secretary may sell mortgages held on unsubsidized projects on such terms and conditions as the Secretary may prescribe.

    ‘(l) PROJECT-BASED RENTAL ASSISTANCE FOR TERM OF LESS THAN 15 YEARS- Notwithstanding subsection (g), project-based rental assistance in connection with the disposition of a multifamily housing project may be provided for a contract term of less than 15 years if such assistance is provided--

      ‘(1) under a contract authorized under section 6 of the HUD Demonstration Act of 1993; and

      ‘(2) pursuant to a disposition plan under this section for a project that is determined by the Secretary to be otherwise in compliance with this section.

    ‘(m) REPORT TO CONGRESS- Not later than June 1 of each year, the Secretary shall submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives, a report describing the status of multifamily housing projects owned by or subject to mortgages held by the Secretary, on an aggregate basis, which highlights the differences, if any, between the subsidized and the unsubsidized inventory. The report shall include--

      ‘(1) the average and median size of the projects;

      ‘(2) the geographic locations of the projects, by State and region;

      ‘(3) the years during which projects were assigned to the Department, and the average and median length of time that projects remain in the HUD-held inventory;

      ‘(4) the status of HUD-held mortgages;

      ‘(5) the physical condition of the HUD-held and HUD-owned inventory;

      ‘(6) the occupancy profile of the projects, including the income, family size, race, and ethnic origin of current tenants, and the rents paid by such tenants;

      ‘(7) the proportion of units that are vacant;

      ‘(8) the number of projects for which the Secretary is mortgagee in possession;

      ‘(9) the number of projects sold in foreclosure sales;

      ‘(10) the number of HUD-owned projects sold;

      ‘(11) a description of actions undertaken pursuant to this section, including--

        ‘(A) a comparison of results between actions taken after the date of enactment of the Housing and Community Development Act of 1993 and actions taken in the years preceding such date of enactment;

        ‘(B) a description of any impediments to the disposition or management of multifamily housing projects, together with a recommendation of proposed legislative or regulatory changes designed to ameliorate such impediments;

        ‘(C) a description of actions taken to restructure or commence foreclosure on delinquent multifamily mortgages held by the Department; and

        ‘(D) a description of actions taken to monitor and prevent the default of multifamily housing mortgages held by the Federal Housing Administration;

      ‘(12) a description of any of the functions performed in connection with this section that are contracted out to public or private entities or to States, including--

        ‘(A) the costs associated with such delegation;

        ‘(B) the implications of contracting out or delegating such functions for current Department field or regional personnel, including anticipated personnel or work load reductions;

        ‘(C) necessary oversight required by Department personnel, including anticipated personnel hours devoted to such oversight;

        ‘(D) a description of any authority granted to such public or private entities or States in conjunction with the functions that have been delegated or contracted out or that are not otherwise available for use by Department personnel; and

        ‘(E) the extent to which such public or private entities or States include tenants of multifamily housing projects in the disposition planning for such projects; and

      ‘(13) a description of the activities carried out under subsection (i) during the preceding year.’.

    (c) 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 section. 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.

SEC. 102. REPEAL OF STATE AGENCY MULTIFAMILY PROPERTY DISPOSITION DEMONSTRATION.

    Section 184 of the Housing and Community Development Act of 1987 (12 U.S.C. 1701z-11 note) is hereby repealed.

SEC. 103. RTC MARKETING AND DISPOSITION OF MULTIFAMILY PROJECTS OWNED BY HUD.

    (a) AUTHORIZATION- The Secretary may carry out a demonstration with not more than 50 unsubsidized multifamily housing projects owned by the Secretary, using the RTC for the marketing and disposition of the projects. Any such demonstration shall be carried out pursuant to an agreement between the RTC and the Secretary on such terms and conditions as are acceptable to the RTC and the Secretary. The RTC shall establish policies and procedures for marketing and disposition, subject to review and approval by the Secretary.

    (b) RULES GOVERNING THE DEMONSTRATION-

      (1) IN GENERAL- Except as provided in paragraph (2), in carrying out the provisions of this section, the RTC shall dispose of unsubsidized multifamily housing projects pursuant to the provisions of section 21A(c) of the Federal Home Loan Bank Act.

      (2) EXCEPTION- Notwithstanding paragraph (1), a very low-income tenant currently residing in a unit otherwise required under subsection (e)(1)(D) of section 203 of the Housing and Community Development Amendments of 1978 to receive project-based rental assistance under section 8, shall upon disposition pay not more than the amount payable as rent under section 3(a) of the United States Housing Act of 1937.

    (c) DETERMINATION OF PROJECTS INCLUDED- In determining which projects to include in the demonstration, the Secretary and the RTC shall take into consideration--

      (1) the prior experience of the RTC in disposing of other multifamily housing projects in the jurisdictions in which such projects are located; and

      (2) such other factors as the Secretary and the RTC determine to be appropriate.

    (d) REIMBURSEMENT- The agreement entered into pursuant to subsection (a) shall provide that the Secretary shall reimburse the RTC for the direct costs associated with the demonstration, including the costs of administration and marketing, property management, and any repair and rehabilitation. The Secretary may use proceeds from the sale of the projects to reimburse the RTC for its costs.

    (e) REPORTS-

      (1) ANNUAL REPORTS- The Secretary and the RTC shall jointly submit an annual report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives detailing the progress of the demonstration.

      (2) FINAL REPORT- Not later than 3 months after the completion of the demonstration, the Secretary shall submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives a report describing the results of the demonstration and any recommendations for legislative action.

    (f) TERMINATION- The demonstration under this section shall not extend beyond the termination date of the RTC.

SEC. 104. CIVIL MONEY PENALTIES AGAINST GENERAL PARTNERS AND CERTAIN MANAGING AGENTS OF MULTIFAMILY HOUSING PROJECTS.

    (a) CIVIL MONEY PENALTIES AGAINST MULTIFAMILY MORTGAGORS- Section 537 of the National Housing Act (12 U.S.C. 1735f-15) is amended--

      (1) in subsection (b)(1), by inserting after ‘mortgagor’ the second place it appears the following: ‘or general partner of a partnership mortgagor’;

      (2) in subsection (c)--

        (A) by striking the heading and inserting the following:

    ‘(c) OTHER VIOLATIONS- ’; and

        (B) in paragraph (1)--

          (i) by striking ‘The Secretary may’ and all that follows through the colon and inserting the following:

        ‘(A) LIABLE PARTIES- The Secretary may also impose a civil money penalty under this section on--

          ‘(i) any mortgagor of a property that includes 5 or more living units and that has a mortgage insured, coinsured, or held pursuant to this Act;

          ‘(ii) the general partner of a partnership mortgagor of such property; or

          ‘(iii) any agent employed to manage the property that has an identity of interest with the mortgagor or the general partner of a partnership mortgagor of such property.

        ‘(B) VIOLATIONS- A penalty may be imposed under this paragraph for knowingly and materially taking any of the following actions:’;

          (ii) in subparagraph (B), as redesignated, by redesignating subparagraphs (A) through (L) as clauses (i) through (xii), respectively; and

          (iii) by adding after clause (xii), as redesignated, the following new clauses:

          ‘(xiii) Failure to maintain the premises, accommodations, and the grounds and equipment appurtenant thereto in good repair and condition in accordance with regulations and requirements of the Secretary, except that nothing in this clause shall have the effect of altering the provisions of an existing regulatory agreement or federally insured mortgage on the property.

          ‘(xiv) Failure, by a mortgagor or general partner of a partnership mortgagor, to provide management for the project that is acceptable to the Secretary pursuant to regulations and requirements of the Secretary.’; and

          (iv) in the last sentence, by deleting ‘of such agreement’ and inserting ‘of this subsection’;

      (3) in subsection (d)(1)(B), by inserting after ‘mortgagor’ the following: ‘, general partner of a partnership mortgagor, or identity of interest agent employed to manage the property,’;

      (4) in subsection (d), by adding at the end the following new paragraph:

      ‘(5) PAYMENT OF PENALTY- No payment of a civil money penalty levied under this section shall be payable out of project income.’;

      (5) in subsection (e)(1), by deleting ‘a mortgagor’ and inserting ‘an entity or person’;

      (6) in subsection (f), by inserting after ‘mortgagor’ each place such term appears the following: ‘, general partner of a partnership mortgagor, or identity of interest agent employed to manage the property,’;

      (7) by striking the heading of subsection (f) and inserting the following: ‘CIVIL MONEY PENALTIES AGAINST MULTIFAMILY MORTGAGORS, GENERAL PARTNERS OF PARTNERSHIP MORTGAGORS, AND CERTAIN MANAGING AGENTS’;

      (8) in subsection (j), by striking ‘all civil money’ and all that follows through the period at the end and inserting the following: ‘the Secretary shall apply all civil money penalties collected under this section, or any portion of such penalties, to the fund established under section 201(j) of the Housing and Community Development Amendments of 1978.’; and

      (9) by adding at the end the following new subsection:

    ‘(k) IDENTITY OF INTEREST MANAGING AGENT- For purposes of this section, the term ‘identity of interest managing agent’ means an ownership entity, or its general partner or partners, which has an ownership interest in and which exerts effective control over the property’s ownership.’.

    (b) IMPLEMENTATION- The Secretary shall implement the amendments made by this section by regulation issued after notice and opportunity for public comment. A proposed rule shall be published not later than March 1, 1994. The notice shall seek comments primarily as to the definition of the terms ‘ownership interest in’ and ‘effective control’, as such terms are used in the definition of identity of interest managing agent.

    (c) APPLICABILITY OF AMENDMENTS- The amendments made by subsection (a) shall apply only with respect to--

      (1) violations that occur on or after the effective date of the final regulations implementing the amendments made by this section; and

      (2) in the case of a continuing violation (as determined by the Secretary), any portion of a violation that occurs on or after such date.

SEC. 105. MODELS FOR PROPERTY DISPOSITION.

    The Federal Housing Commissioner shall develop models which shall be designed to assist States and units of general local government in using other Federal programs for the purpose of acquiring, rehabilitating, or otherwise participating in--

      (1) the disposition, pursuant to section 203 of the Housing and Community Development Amendments of 1978, of multifamily housing projects owned by the Secretary; or

      (2) the sale, pursuant to section 203 of the Housing and Community Development Amendments of 1978, of multifamily housing projects subject to mortgages held by the Secretary.

SEC. 106. PREVENTING MORTGAGE DEFAULTS.

    (a) MULTIFAMILY HOUSING PLANNING AND INVESTMENT STRATEGIES-

      (1) PREPARATION OF ASSESSMENTS FOR INDEPENDENT ENTITIES- Section 402(a) of the Housing and Community Development Act of 1992 (12 U.S.C. 1715-1a note) is amended by adding at the end the following: ‘The assessment shall be prepared by an entity that does not have an identity of interest with the owner.’.

      (2) TIMING OF SUBMISSION OF NEEDS ASSESSMENTS- Section 402(b) of the Housing and Community Development Act of 1992 (12 U.S.C. 17152-1a note) is amended to read as follows:

    ‘(b) TIMING- To ensure that assessments for all covered multifamily housing properties will be submitted on or before the conclusion of fiscal year 1997, the Secretary shall require the owners of such properties, including covered multifamily housing properties for the elderly, to submit the assessments for the properties in accordance with the following schedule:

      ‘(1) For fiscal year 1994, 10 percent of the aggregate number of such properties.

      ‘(2) For each of fiscal years 1995, 1996, and 1997, an additional 30 percent of the aggregate number of such properties.’.

      (3) REVIEW OF COMPREHENSIVE NEEDS ASSESSMENTS- Section 404(d) of the Housing and Community Development Act of 1992 (12 U.S.C. 1715-1a note) is amended to read as follows:

    ‘(d) REVIEW-

      ‘(1) IN GENERAL- The Secretary shall review each comprehensive needs assessment for completeness and adequacy before the expiration of the 90-day period beginning on the receipt of the assessment.

      ‘(2) INCOMPLETE OR INADEQUATE ASSESSMENTS- If the Secretary determines that the assessment is substantially incomplete or inadequate, the Secretary shall--

        ‘(A) provide the owner with a reasonable amount of time to resubmit an amended assessment; and

        ‘(B) indicate to the owner the portion of the original assessment requiring completion or other revision.’.

      (4) REPEAL OF NOTICE PROVISION- Section 404(f) of the Housing and Community Development Act of 1992 (12 U.S.C. 1715-1a note) is hereby repealed.

      (5) FUNDING- Title IV of the Housing and Community Development Act of 1992 (12 U.S.C. 1715z-1a note) is amended by adding at the end the following new section:

‘SEC. 409. FUNDING.

    ‘(a) ALLOCATION OF ASSISTANCE- Based upon needs identified in comprehensive needs assessments, and subject to otherwise applicable program requirements, including selection criteria, the Secretary may allocate the following assistance to owners of covered multifamily housing projects and may provide such assistance on a noncompetitive basis:

      ‘(1) Operating assistance and capital improvement assistance for troubled multifamily housing projects pursuant to section 201 of the Housing and Community Development Amendments of 1978, except for assistance set aside under section 201(n)(1).

      ‘(2) Loan management assistance available pursuant to section 8 of the United States Housing Act of 1937.

    ‘(b) OPERATING ASSISTANCE AND CAPITAL IMPROVEMENT ASSISTANCE- In providing assistance under subsection (a) the Secretary shall use the selection criteria set forth in section 201(n) of the Housing and Community Development Amendments.

    ‘(c) AMOUNT OF ASSISTANCE- The Secretary may fund all or only a portion of the needs identified in the capital needs assessment of an owner selected to receive assistance under this section.’.

    (b) FLEXIBLE SUBSIDY PROGRAM-

      (1) DELETION OF UTILITY COST REQUIREMENTS- Section 201(i) of the Housing and Community Development Amendments of 1978 (12 U.S.C. 1715z-1a(i)) is hereby repealed.

      (2) REPEAL OF MANDATORY CONTRIBUTION FROM OWNER- Section 201(k)(2) of the Housing and Community Development Amendments of 1978 (12 U.S.C. 1715z-1a(k)(2)) is amended by striking ‘, except that’ and all that follows through ‘such loan’.

      (3) FUNDING- Section 201(n) of the Housing and Community Development Amendments of 1978 (42 U.S.C. 1715z-1a(n)) is amended to read as follows:

    ‘(n)(1) For fiscal year 1994 only, in providing, and contracting to provide, assistance for capital improvements under this section, the Secretary shall set aside an amount, as determined by the Secretary, for projects that are eligible for incentives under section 224(b) of the Emergency Low Income Housing Preservation Act of 1987, as such section existed before the date of enactment of the Cranston-Gonzalez National Affordable Housing Act. The Secretary may make such assistance available on a noncompetitive basis.

    ‘(2) Except as provided in paragraph (3), with respect to assistance under this section not set aside for projects under paragraph (1), the Secretary--

      ‘(A) may award assistance on a noncompetitive basis; and

      ‘(B) shall award assistance to eligible projects on the basis of--

        ‘(i) the extent to which the project is physically or financially troubled, as evidenced by the comprehensive needs assessment submitted in accordance with title IV of the Housing and Community Development Act of 1992; and

        ‘(ii) the extent to which such assistance is necessary and reasonable to prevent the default of federally insured mortgages.

    ‘(3) The Secretary may make exceptions to selection criteria set forth in paragraph (2) to permit the provision of assistance to eligible projects based upon--

      ‘(A) the extent to which such assistance is necessary to prevent the imminent foreclosure or default of a project whose owner has not submitted a comprehensive needs assessment pursuant to title IV of the Housing and Community Development Act of 1992;

      ‘(B) the extent to which the project presents an imminent threat to the life, health, and safety of project residents; or

      ‘(C) such other criteria as the Secretary may specify by regulation or by notice printed in the Federal Register.

    ‘(4) In providing assistance under this section, the Secretary shall take into consideration--

      ‘(A) the extent to which there is evidence that there will be significant opportunities for residents (including a resident council or resident management corporation, as appropriate) to be involved in the management of the project (except that this paragraph shall have no application to projects that are owned as cooperatives); and

      ‘(B) the extent to which there is evidence that the project owner has provided competent management and complied with all regulatory and administrative instructions (including such instructions with respect to the comprehensive servicing of multifamily projects as the Secretary may issue).’.

    (c) IMPLEMENTATION AND EFFECTIVE DATE FOR SUBSECTIONS (a) AND (b)-

      (1) IN GENERAL- 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 subsections (a) and (b). 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.

      (2) CONTENTS- The notice and the regulations shall describe the method by which the Secretary allocates assistance in accordance with section 409 of the Housing and Community Development Act of 1992 (as added by section 106(a) of this Act) and paragraphs (2) and (3) of section 201(n) of the Housing and Community Development Amendments of 1978.

      (3) ANNUAL PUBLICATIONS- The Secretary shall publish annually in the Federal Register--

        (A) the method by which the Secretary determines which capital needs assessments will be received each year, in accordance with sections 402(b) and 404(d) of the Housing and Community Development Act of 1992; and

        (B) a list of all owners of covered multifamily housing projects, by project, that have received funding under--

          (i) section 409 of the Housing and Community Development Act of 1992 (as added by section 106(a) of this Act); or

          (ii) paragraphs (2) and (3) of section 201(n) of the Housing and Community Development Amendments of 1978.

      (4) EFFECTIVE DATE-

        (A) IN GENERAL- Except as provided in subparagraph (B), the amendments made by subsections (a) and (b) shall take effect for amounts made available for fiscal year 1995.

        (B) EXCEPTION- Notwithstanding subparagraph (A), section 201(n)(1) of the Housing and Community Development Amendments of 1978 (as added by subsection (b)(3)) shall take effect on the date of enactment of this Act.

    (d) STREAMLINED REFINANCING- As soon as practicable, the Secretary shall implement a streamlined refinancing program under the authority provided in section 223 of the National Housing Act to prevent the default of mortgages insured by the FHA which cover multifamily housing projects, as defined in section 203(b) of the Housing and Community Development Amendments of 1978.

    (e) PARTIAL PAYMENTS OF CLAIM-

      (1) IN GENERAL- Notwithstanding any other provision of law, if the Secretary is requested to accept assignment of a mortgage insured by the Secretary that covers a multifamily housing project, as such term is defined in section 203(b) of the Housing and Community Development Amendments of 1978, and the Secretary determines that partial payment would be less costly to the Federal Government than other reasonable alternatives for maintaining the low-income character of the project, the Secretary may request the mortgagee, in lieu of assignment, to--

        (A) accept partial payment of the claim under the mortgage insurance contract; and

        (B) recast the mortgage, under such terms and conditions as the Secretary may determine.

      (2) CONDITION- As a condition to a partial claim payment under this section, the mortgagor shall agree to repay to the Secretary the amount of such payment and such obligation shall be secured by a second mortgage on the property on such terms and conditions as the Secretary may determine.

    (f) GAO STUDY ON PREVENTION OF DEFAULT-

      (1) IN GENERAL- Not later than June 1, 1994, the Comptroller General of the United States shall submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives a report that evaluates the adequacy of loan loss reserves in the General Insurance and Special Risk Insurance Funds and presents recommendations for the Secretary to prevent losses from occurring.

      (2) CONTENTS- The report submitted under paragraph (1) shall--

        (A) evaluate the factors considered in arriving at loss estimates and determine whether other factors should be considered;

        (B) determine the relative benefit of creating a new, actuarially sound insurance fund for all new multifamily housing insurance commitments; and

        (C) recommend alternatives to the Secretary’s current procedures for preventing the future default of multifamily housing project mortgages insured under title II of the National Housing Act.

    (g) GAO STUDY ON ACTUARIAL SOUNDNESS OF CERTAIN INSURANCE PROGRAMS-

      (1) IN GENERAL- Not later than June 1, 1994, the Comptroller General of the United States shall submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives a report that evaluates, in connection with the General Insurance Fund, the role and performance of the nursing home, hospital, and retirement service center insurance programs.

      (2) CONTENTS- The reports submitted under paragraph (1) shall--

        (A) evaluate the strategic importance of these insurance programs to the mission of the FHA;

        (B) evaluate the impact of these insurance programs upon the financial performance of the General Insurance Fund;

        (C) assess the potential losses expected under these programs through fiscal year 1999;

        (D) evaluate the risk of these programs to the General Insurance Fund in connection with changes in national health care policy;

        (E) assess the ability of the FHA to manage these programs; and

        (F) make recommendations for any necessary changes.

    (h) ANNUAL ACTUARIAL REVIEW-

      (1) SPECIAL RISK INSURANCE FUND- Section 238(c) of the National Housing Act (12 U.S.C. 1715z-3(c)) is amended by adding at the end the following new paragraph:

      ‘(3) The Secretary shall undertake an annual review of the actuarial soundness of each of the insurance programs comprising the Special Risk Insurance Fund, and shall present findings from such review to the Congress in the FHA Annual Management Report.’.

      (2) GENERAL INSURANCE FUND- Section 519 of the National Housing Act (12 U.S.C. 1735c) is amended by adding at the end the following new subsection:

    ‘(g) ANNUAL ACTUARIAL REVIEW- The Secretary shall undertake an annual review of the actuarial soundness of each of the insurance programs comprising the General Insurance Fund, and shall present findings from such review to the Congress in the FHA Annual Management Report.’.

    (i) ALTERNATIVE USES FOR PREVENTION OF DEFAULT-

      (1) IN GENERAL- Subject to notice and comment from existing tenants, to prevent the imminent default of a multifamily housing project subject to a mortgage insured under title II of the National Housing Act, the Secretary may authorize the mortgagor to use the project for purposes not contemplated by or permitted under the regulatory agreement, if--

        (A) such other uses are acceptable to the Secretary;

        (B) such other uses would be otherwise insurable under title II of the National Housing Act;

        (C) the outstanding principal balance on the mortgage covering such project is not increased;

        (D) any financial benefit accruing to the mortgagor shall, subject to the discretion of the Secretary, be applied to project reserves or project rehabilitation; and

        (E) such other use serves a public purpose.

      (2) DISPLACEMENT PROTECTION- The Secretary shall--

        (A) make available tenant-based assistance under section 8 of the United States Housing Act of 1937 to any tenant displaced as a result of actions taken by the Secretary pursuant to paragraph (1); and

        (B) take such actions as the Secretary determines necessary to ensure the successful use of any tenant-based assistance provided under this paragraph.

      (3) IMPLEMENTATION- 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 subsection. 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.

    (j) MORTGAGE SALE DEMONSTRATION- The Secretary may carry out a demonstration to test the feasibility of restructuring and disposing of troubled multifamily mortgages held by the Secretary through the establishment of partnerships between public, private, and nonprofit entities.

    (k) NATIONAL INTERAGENCY TASK FORCE ON MULTIFAMILY HOUSING-

      (1) FUNCTIONS- Section 543(e)(1) of the Housing and Community Development Act of 1992 (12 U.S.C. 1707 note) is amended--

        (A) in subparagraph (D), by striking ‘and’ at the end;

        (B) in subparagraph (E), by striking the period at the end and inserting ‘; and’; and

        (C) by adding at the end the following new subparagraph:

        ‘(F) make available appropriate information to the Department of Housing and Urban Development that will assist in preventing the future default of multifamily housing project mortgages insured under title II of the National Housing Act.’.

      (2) USE OF APPROPRIATIONS AUTHORITY- Section 543(h) of the Housing and Community Development Act of 1992 is amended by inserting after the first sentence the following: ‘The Secretary may use any non-Federal or private funding or may use the authority provided for salaries and expenses in appropriations Acts for activities carried out under this section.

SEC. 107. INTEREST RATES ON ASSIGNED MORTGAGES.

    Section 7(i)(5) of the Department of Housing and Urban Development Act (42 U.S.C. 3535(i)(5)) is amended by striking the first semicolon, and all that follows through ‘as determined by the Secretary’.

SEC. 108. AUTHORIZATION OF APPROPRIATIONS.

    (a) SPECIAL RISK INSURANCE FUND- Section 238(b) of the National Housing Act (12 U.S.C. 1715z-3(b)) is amended by striking the fifth sentence.

    (b) GENERAL INSURANCE FUND- Section 519 of the National Housing Act (12 U.S.C. 1735c) is amended--

      (1) by striking subsection (f); and

      (2) by redesignating subsection (g) (as added by section 106(h)(2) of this Act) as subsection (f).

    (c) MULTIFAMILY INSURANCE FUND APPROPRIATIONS- Title V of the National Housing Act (12 U.S.C. 1731a et seq.) is amended by adding at the end the following new section:

‘SEC. 541. AUTHORIZATION OF APPROPRIATIONS FOR GENERAL AND SPECIAL RISK INSURANCE FUNDS.

    ‘There are authorized to be appropriated $350,000,000 for fiscal year 1994 and $360,500,000 for fiscal year 1995, to be allocated in any manner that the Secretary determines appropriate, for the following costs incurred in conjunction with programs authorized under the General Insurance Fund, as provided by section 519, and the Special Risk Insurance Fund, as provided by section 238:

      ‘(1) The cost to the Government, as defined in section 502 of the Congressional Budget Act, of new insurance commitments.

      ‘(2) The cost to the Government, as defined in section 502 of the Congressional Budget Act, of modifications to existing loans, loan guarantees, or insurance commitments.

      ‘(3) The cost to the Government, as defined in section 502 of the Congressional Budget Act, of loans provided under section 203(f) of the Housing and Community Development Amendments of 1978.

      ‘(4) The costs of the rehabilitation of multifamily housing projects (as defined in section 203(b) of the Housing and Community Development Amendments of 1978) upon disposition by the Secretary.’.

TITLE II--ENHANCED PROGRAM FLEXIBILITY

Subtitle A--Office of Public and Indian Housing

SEC. 201. REVITALIZATION OF SEVERELY DISTRESSED PUBLIC HOUSING.

    (a) IN GENERAL- Section 24 of the United States Housing Act of 1937 (42 U.S.C. 1437v) is amended--

      (1) by amending subsection (b) to read as follows:

    ‘(b) [RESERVED].’;

      (2) in subsection (c)(2), by striking ‘$200,000’ and inserting ‘$500,000’;

      (3) in subsection (c)(3)--

        (A) by redesignating subparagraphs (E) through (I) as subparagraphs (F) through (J), respectively;

        (B) by inserting after subparagraph (D) the following new subparagraph:

        ‘(E) planning for community service and support service activities to be carried out by the public housing agency, residents, members of the community, and other persons and organizations willing to contribute to the social, economic, or physical improvement of the community (community service is a required element of the revitalization program);’; and

        (C) in subparagraph (H), as redesignated, by striking ‘designing a suitable replacement housing plan,’ and inserting ‘designing suitable relocation and replacement housing plans,’;

      (4) in subsection (c)(4)--

        (A) by redesignating subparagraphs (D) and (E) as subparagraphs (E) and (F), respectively; and

        (B) by inserting after subparagraph (C) the following new subparagraph:

        ‘(D) a description of the community service and support service planning activities to be carried out by the public housing agency, residents, members of the community, and other persons and organizations willing to contribute to the social, economic, or physical improvement of the community;’;

      (5) in subsection (c)(5)--

        (A) by striking subparagraph (E) and redesignating subparagraphs (F) and (G) as subparagraphs (E) and (F), accordingly;

        (B) in subparagraph (E), as redesignated, by inserting before the semicolon ‘, taking into account the condition of the stock of the public housing agency as a whole’; and

        (C) by adding at the end the following:

      ‘In making grants under this subsection, the Secretary may select a lower-rated, approvable application over a higher-rated application to increase the national geographic diversity among applications approved under this section.’;

      (6) in subsection (d)(2)--

        (A) by redesignating subparagraphs (E) through (I) as subparagraphs (G) through (K), respectively;

        (B) by inserting after subparagraph (D) the following new subparagraphs:

        ‘(E) community service activities to be carried out by residents, members of the community, and other persons willing to contribute to the social, economic, or physical improvement of the community (community service is a required element of the revitalization program);

        ‘(F) replacement of public housing units;’; and

        (C) in subparagraph (K), as redesignated--

          (i) by striking ‘15 percent’ and inserting ‘20 percent’; and

          (ii) by inserting before the period at the end the following: ‘, except that an amount equal to 15 percent of the amount of any grant under this subsection used for support services shall be contributed from non-Federal sources (which contribution shall be in the form of cash, administrative costs, and the reasonable value of in-kind contributions and may include funding under title I of the Housing and Community Development Act of 1974)’;

      (7) in subsection (d)(3)--

        (A) by redesignating subparagraphs (D) and (E) as subparagraphs (E) and (F), respectively; and

        (B) by inserting after subparagraph (C) the following new subparagraph:

        ‘(D) a description of the community service and support service activities to be carried out by the public housing agency, residents, members of the community, and other persons and organizations willing to contribute to the social, economic, or physical improvement of the community;’;

      (8) in subsection (d)(4)--

        (A) in subparagraph (D), by inserting ‘(with assistance from the Department of Housing and Urban Development if necessary)’ after ‘applicant’;

        (B) by striking subparagraph (E) and redesignating subparagraphs (F) and (G) as subparagraphs (E) and (F), respectively;

        (C) in subparagraph (E), as redesignated, by inserting before the semicolon ‘, taking into account the condition of the applicant’s stock as a whole’; and

        (D) by adding at the end the following:

      ‘In making grants under this subsection, the Secretary may select a lower-rated, approvable application over a higher-rated application to increase the national geographic diversity among applications approved under this section.’;

      (9) in subsection (e), by adding at the end the following new paragraph:

      ‘(3) DEMOLITION AND REPLACEMENT-

        ‘(A) IN GENERAL- Notwithstanding any other applicable law or regulation, a revitalization plan under this section may include demolition and replacement on site or in the same neighborhood if the number of replacement units provided in the same neighborhood is fewer than the number of units demolished as a result of the revitalization effort.

        ‘(B) TENANT-BASED ASSISTANCE- Notwithstanding the limitations contained in subparagraph (A)(v) or (C) of section 18(b)(3), a public housing agency may replace not more than one-third of the units demolished or disposed of through a revitalization project under this section with tenant-based assistance under section 8.’;

      (10) in subsection (h)--

        (A) by amending paragraph (5) to read as follows:

      ‘(5) SEVERELY DISTRESSED PUBLIC HOUSING- The term ‘severely distressed public housing’ means a public housing project or a building in a project--

        ‘(A) that requires major redesign, reconstruction, redevelopment, or partial or total demolition to correct serious deficiencies in the original design (including inappropriately high population density), deferred maintenance, physical deterioration or obsolescence of major systems, and other deficiencies in the physical plant of the project; and

        ‘(B) that either--

          ‘(i)(I) is occupied predominantly by families with children that have extremely low incomes, high rates of unemployment, and extensive dependency on various forms of public assistance; and

          ‘(II) has high rates of vandalism and criminal activity (including drug-related criminal activity); or

          ‘(ii) that has a vacancy rate, as determined by the Secretary, of 50 percent or more;

        ‘(C) that cannot be revitalized through assistance under other programs, such as the programs under sections 9 and 14, or through other administrative means because of the inadequacy of available funds; and

        ‘(D) that, in the case of individual buildings, the building is, in the Secretary’s determination, sufficiently separable from the remainder of the project to make use of the building feasible for purposes of this section.’; and

        (B) by adding at the end the following new paragraphs:

      ‘(6) COMMUNITY SERVICE- The term ‘community service’ means services provided on a volunteer or limited stipend basis for the social, economic, or physical improvement of the community to be served.

      ‘(7) SUPPORT SERVICES- The term ‘support services’ includes all activities designed to lead toward upward mobility, self-sufficiency, and improved quality of life for the residents of the project, such as literacy training, job training, day care, and economic development. Such activities may allow for the participation of residents of the neighborhood.’; and

      (11) in subsection (i)--

        (A) by striking paragraph (2); and

        (B) by redesignating paragraphs (3) and (4) as paragraphs (2) and (3), respectively.

    (b) CONFORMING AMENDMENT- The first sentence of section 25(m)(1) of the United States Housing Act of 1937 (42 U.S.C. 1437w(m)(1)) is amended to read as follows:

      ‘(1) The term ‘eligible housing’ means a public housing project, or one or more buildings within a project, that is owned or operated by a public housing agency that has been troubled for not less than 3 years and that, as determined by the Secretary, has failed to make substantial progress toward effective management.’.

    (c) USE OF TENANT-BASED ASSISTANCE FOR REPLACEMENT HOUSING- Section 18(b)(3)(C)(i) of the United States Housing Act of 1937 (42 U.S.C. 1437p(b)(3)(C)(i)) is amended by striking ‘15-year’.

    (d) REPLACEMENT HOUSING OUTSIDE THE JURISDICTION OF THE PHA- Section 18(b)(3) of the United States Housing Act of 1937 (42 U.S.C. 1437p(b)(3)), as amended by subsection (c), is amended--

      (1) by redesignating subparagraphs (D) through (H) as subparagraphs (E) through (I), respectively; and

      (2) by inserting after subparagraph (C) the following new subparagraph:

      ‘(D) may provide that all or part of such additional dwelling units may be located outside of the jurisdiction of the public housing agency (the ‘original agency’) if--

        ‘(i) the location is in the same housing market area as the original agency, as determined by the Secretary;

        ‘(ii) the plan contains an agreement between the original agency and the public housing agency in the alternate location or other public or private entity that will be responsible for providing the additional units in the alternate location (‘alternate agency or entity’) that the alternate agency or entity will, with respect to the dwelling units involved--

          ‘(I) provide the dwelling units in accordance with subparagraph (A);

          ‘(II) complete the plan on schedule in accordance with subparagraph (F);

          ‘(III) meet the requirements of subparagraph (G) and the maximum rent provisions of subparagraph (H); and

          ‘(IV) not impose a local residency preference on any resident of the jurisdiction of the original agency for purposes of admission to any such units; and

        ‘(iii) the arrangement is approved by the unit of general local government for the jurisdiction in which the additional units will be located;’.

SEC. 202. DISALLOWANCE OF EARNED INCOME FOR RESIDENTS WHO OBTAIN EMPLOYMENT.

    (a) IN GENERAL- Section 3 of the United States Housing Act of 1937 (42 U.S.C. 1437a) is amended--

      (1) by striking the undesignated paragraph at the end of subsection (c)(3) (as added by section 515(b) of the Cranston-Gonzalez National Affordable Housing Act); and

      (2) by adding at the end the following new subsection:

    ‘(d) DISALLOWANCE OF EARNED INCOME FROM PUBLIC HOUSING RENT DETERMINATIONS- Notwithstanding any other provision of law, the rent payable under subsection (a) for any public housing unit by a family whose income increases as a result of employment of a member of the family who was previously unemployed for one or more years (including a family whose income increases as a result of the participation of a family member in the Family Self-Sufficiency program or other job training program) shall not be increased for a period of 18 months, beginning with the commencement of employment as a result of the increased income due to such employment. After the expiration of the 18-month period, rent increases due to the continued employment of such family member shall be limited to 10 percent per year. In no case shall rent exceed the amount determined under subsection (a).’.

    (b) APPLICABILITY OF AMENDMENT- Notwithstanding the amendment made by subsection (a), any resident of public housing participating in the program under the authority contained in the undesignated paragraph at the end of section 3(c)(3) of the United States Housing Act of 1937 as such paragraph existed before the date of enactment of this subsection shall continue to be governed by such authority.

SEC. 203. CEILING RENTS BASED ON REASONABLE RENTAL VALUE.

    (a) AMENDMENT- Section 3(a)(2)(A)(iii) of the United States Housing Act of 1937 (42 U.S.C. 1437a(a)(2)(A)(iii)) is amended to read as follows:

      ‘(iii) is not less than the reasonable rental value of the unit, as determined by the Secretary.’.

    (b) REGULATIONS-

      (1) IN GENERAL- The Secretary shall, by regulation, after notice and an opportunity for public comment, establish such requirements as may be necessary to carry out the provisions of section 3(a)(2)(A) of the United States Housing Act of 1937, as amended by subsection (a).

      (2) APPLICABILITY- Except in the case of an Indian housing authority, the regulations issued pursuant to paragraph (1) shall not apply to scattered site public housing units.

      (3) TRANSITION RULE- Prior to the issuance of final regulations under paragraph (1), a public housing agency may implement ceiling rents which shall be--

        (A) determined in accordance with section 3(a)(2)(A) of the United States Housing Act of 1937, as such section existed before the date of enactment of this Act; or

        (B) equal to the 95th percentile of the rent paid for a unit of comparable size by tenants in the same project or a group of comparable projects totaling 50 units or more.

SEC. 204. RESIDENT MANAGEMENT PROGRAM.

    Section 20(f) of the United States Housing Act of 1937 (42 U.S.C. 1437r(f)) is amended--

      (1) in paragraph (2), by striking ‘$100,000’ and inserting ‘$250,000’; and

      (2) in paragraph (3), by adding at the end the following: ‘The Secretary may use not more than 10 percent of the amounts made available under this subsection for program monitoring and evaluation, technical assistance, and information dissemination.’.

Subtitle B--Office of Community Planning and Development

SEC. 211. ECONOMIC DEVELOPMENT INITIATIVE.

    (a) SECTION 108 ELIGIBLE ACTIVITIES-

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

        (A) in the first sentence--

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

          (ii) 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

        (B) 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).’.

      (2) 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.’.

    (b) ECONOMIC DEVELOPMENT GRANTS-

      (1) 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.’.

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

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

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

    (c) 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 be used to provide grants under section 108(q).’.

    (d) UDAG AMNESTY PROGRAM-

      (1) 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.’.

      (2) IMPLEMENTATION- Notwithstanding subsection (f), 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 subsection.

    (e) 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 subsection (b), 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.’.

    (f) 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 section. 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.

SEC. 212. HOME INVESTMENT PARTNERSHIPS.

    (a) PARTICIPATION BY STATE AGENCIES OR INSTRUMENTALITIES- Section 104(2) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12704(2)) is amended by inserting before the period at the end the following: ‘, or any agency or instrumentality thereof that is established pursuant to legislation and designated by the chief executive to act on behalf of the State with regard to the provisions of this Act’.

    (b) SIMPLIFY PROGRAM-WIDE INCOME TARGETING FOR HOME RENTAL HOUSING- Section 214(1) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12744(1)) is amended by striking ‘such funds are invested with respect to dwelling units that are occupied by’ each place such term appears and inserting ‘(i) the families receiving such rental assistance are, or (ii) the dwelling units assisted with such funds are occupied by’ in each such place.

    (c) REMOVE FIRST-TIME HOMEBUYER LIMITATION FOR HOME UNITS- Section 215(b) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12745(b)) is amended by striking paragraph (3) and redesignating paragraphs (4) and (5) as paragraphs (3) and (4), respectively.

    (d) SIMPLIFY RESALE PROVISIONS- Section 215(b)(3)(B) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12745(b)(4)(B)), as redesignated by subsection (c), is amended by striking ‘subsection’ and inserting ‘title’.

    (e) STABILIZATION OF HOME FUNDING THRESHOLDS- The Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12701 et seq.) is amended--

      (1) in section 216, by striking paragraph (10);

      (2) in section 217(b), by striking paragraph (4);

      (3) in section 217(b)(3)--

        (A) in the first sentence, by striking ‘only those jurisdictions’ and all that follows through ‘allocation’ and inserting ‘jurisdictions that are not participating jurisdictions that are allocated an amount of $500,000 or more and jurisdictions that are participating jurisdictions shall receive an allocation’; and

        (B) in the last sentence, by striking ‘, except as provided in paragraph (4)’; and

      (4) in section 216--

        (A) in paragraph (3)(A), by striking ‘Except as provided in paragraph (10), a jurisdiction’ and inserting ‘A jurisdiction’; and

        (B) in paragraph (9)(B), by striking ‘, except as provided in paragraph (10)’.

    (f) COMPREHENSIVE AFFORDABLE HOUSING STRATEGY-

      (1) HOME PROGRAM- Section 218(d) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12748(d)) is amended in the first sentence, by inserting ‘that it is following a current housing affordability strategy that has been approved by the Secretary in accordance with section 105, and’ after ‘certification’.

      (2) HOMELESS ASSISTANCE PROGRAMS- Section 401 of the Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11361) is amended to read as follows:

‘SEC. 401. HOUSING AFFORDABILITY STRATEGY.

    ‘(a) REQUIREMENT TO FOLLOW A CHAS- Assistance may be made available under subtitle B to metropolitan cities, urban counties, and States receiving a formula amount under section 413, only if the jurisdiction certifies that it is following a current housing affordability strategy that has been approved by the Secretary in accordance with section 105 of the Cranston-Gonzalez National Affordable Housing Act.

    ‘(b) REQUIREMENT FOR CONSISTENCY WITH CHAS- Assistance may be made available under this title only if the application contains a certification that the proposed project or activities are consistent with the housing affordability strategy of the State or unit of general local government in which the project is located. The certification shall be from the public official responsible for submitting the strategy for the jurisdiction.’.

      (3) CONFORMING CHANGES- Title IV of the Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11361 et seq.) is amended by striking sections 426(a)(2)(F), 434(a)(10), and 454(b)(9).

    (g) HOME MATCHING REQUIREMENTS- Section 220(a) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12750(a)) is amended to read as follows:

    ‘(a) CONTRIBUTION- Each participating jurisdiction shall make contributions to housing that qualifies as affordable housing under this title that total, throughout a fiscal year, not less than 25 percent of the funds drawn from the jurisdiction’s HOME Investment Trust Fund in that fiscal year. Such contribution shall be in addition to any amounts made available under section 216(3)(A)(ii).’.

    (h) SEPARATE AUDIT REQUIREMENT FOR THE HOME PROGRAM- Section 283 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12833) is amended--

      (1) by striking the section heading and inserting the following:

‘SEC. 283. AUDITS BY THE COMPTROLLER GENERAL.’;

      (2) by striking subsection (a);

      (3) in subsection (b)--

        (A) by striking ‘(b) AUDITS BY THE COMPTROLLER GENERAL- ’; and

        (B) by redesignating paragraphs (1) and (2) as subsections (a) and (b), respectively; and

      (4) in subsection (a), as redesignated by paragraph (3), by striking the second sentence.

    (i) HOME ENVIRONMENTAL REVIEW AMENDMENTS- Section 288 of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12838) is amended--

      (1) in subsection (a)--

        (A) in the first sentence, by striking ‘participating jurisdictions’ and inserting ‘jurisdictions, Indian tribes, or insular areas’; and

        (B) by adding at the end the following: ‘The regulations shall--

      ‘(1) provide for the monitoring of environmental reviews performed under this section;

      ‘(2) at the discretion of the Secretary, facilitate training for the performance of such reviews; and

      ‘(3) establish criteria for the suspension or termination of the assumption under this section.

    The Secretary’s duty under this subsection shall not be construed to limit any responsibility assumed by a State or unit of general local government with respect to any particular release of funds.’;

      (2) in subsection (b) in the first sentence, by striking ‘participating jurisdiction’ and inserting ‘jurisdiction, Indian tribe, or insular area’;

      (3) in subsection (c)(4), by striking ‘participating jurisdiction’ and inserting ‘jurisdiction, Indian tribe, or insular area’; and

      (4) in subsection (d), by striking ‘ASSISTANCE TO A STATE- In the case of assistance to States’ and inserting the following: ‘ASSISTANCE TO UNITS OF GENERAL LOCAL GOVERNMENT FROM A STATE- In the case of assistance to units of general local government from a State’.

    (j) USE OF CDBG FUNDS FOR HOME ADMINISTRATIVE EXPENSES- Section 105(a)(13) of the Housing and Community Development Act of 1974 (42 U.S.C. 5305(a)(13)) is amended by inserting after ‘charges related to’ the following: ‘(A) administering the HOME program under title II of the Cranston-Gonzalez National Affordable Housing Act; and (B)’.

    (k) PROJECT DELIVERY COSTS- Section 105(a)(21) of the Housing and Community Development Act of 1974 (42 U.S.C. 5305(a)(21)) is amended--

      (1) by inserting ‘in connection with tenant-based assistance and affordable housing projects assisted under title II of the Cranston-Gonzalez National Affordable Housing Act’ after ‘housing counseling’; and

      (2) by striking ‘authorized’ and all that follows through ‘any law’ and inserting ‘assisted under title II of the Cranston-Gonzalez National Affordable Housing Act’.

SEC. 213. HOPE MATCH REQUIREMENT.

    Section 443(c)(1) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12893(c)(1)) is amended by striking ‘33’ and inserting ‘25’.

SEC. 214. FLEXIBILITY OF CDBG PROGRAM FOR DISASTER AREAS.

    Title I of the Housing and Community Development Act of 1974 (42 U.S.C. 5301 et seq.) is amended by adding at the end the following new section:

‘SEC. 122. SUSPENSION OF REQUIREMENTS FOR DISASTER AREAS.

    ‘For the duration of time during which an area has been declared a disaster area by the President under title IV of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, the Secretary may suspend all requirements for purposes of assistance under section 106 for that area, except for those related to public notice of funding availability, nondiscrimination, fair housing, labor standards, environmental standards, and requirements that activities benefit persons of low- and moderate-income.’.

SEC. 215. FLEXIBILITY OF HOME PROGRAM FOR DISASTER AREAS.

    Title II of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 12721 et seq.) is amended by adding at the end the following new section:

‘SEC. 290. SUSPENSION OF REQUIREMENTS FOR DISASTER AREAS.

    ‘For the duration of time during which an area has been declared a disaster area by the President under title IV of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, the Secretary may suspend all requirements for purposes of assistance under this title for that area, except for those related to public notice of funding availability, nondiscrimination, fair housing, labor standards, environmental standards, and low-income housing affordability.’.

Subtitle C--Community Partnerships Against Crime

SEC. 221. COMPAC PROGRAM.

    (a) CONFORMING PROVISIONS- Section 5001 of the Anti-Drug Abuse Act of 1988 (42 U.S.C. 11901) is amended in the table of contents--

      (1) by striking the item relating to the heading for chapter 2 and inserting the following:

‘Chapter 2--Community Partnerships Against Crime’;

      (2) by striking the item relating to section 5122 and inserting the following:

      ‘Sec. 5122. Purposes.’;

      and

      (3) by adding the following after the item relating to section 5130:

      ‘Sec. 5131. Technical assistance.’.

    (b) SHORT TITLE, PURPOSES, AND AUTHORITY TO MAKE GRANTS- The Public and Assisted Housing Drug Elimination Act of 1990 (42 U.S.C. 11901 et seq.) is amended by striking the chapter heading for chapter 2, and by striking sections 5121, 5122, and 5123 and inserting the following:

‘CHAPTER 2--COMMUNITY PARTNERSHIPS AGAINST CRIME

‘SEC. 5121. SHORT TITLE.

    ‘This chapter may be cited as the ‘Community Partnerships Against Crime Act of 1993’.

‘SEC. 5122. PURPOSES.

    ‘The purposes of this chapter are to--

      ‘(1) improve the quality of life for law-abiding public housing residents by reducing the levels of fear, violence, and crime in their communities;

      ‘(2) expand and enhance the Federal Government’s commitment to eliminating crime in public housing;

      ‘(3) broaden the scope of the Public and Assisted Housing Drug Elimination Act of 1990 to apply to all types of crime, and not simply crime that is drug-related;

      ‘(4) target opportunities for long-term commitments of funding primarily to public housing agencies with serious crime problems;

      ‘(5) encourage the involvement of a broad range of community-based groups, and residents of neighboring housing that is owned or assisted by the Secretary, in the development and implementation of anti-crime plans;

      ‘(6) reduce crime and disorder in and around public housing through the expansion of community-oriented policing activities and problem solving;

      ‘(7) provide training, information services, and other technical assistance to program participants; and

      ‘(8) establish a standardized assessment system to evaluate need among public housing agencies, and to measure progress in reaching crime reduction goals.

‘SEC. 5123. AUTHORITY TO MAKE GRANTS.

    ‘The Secretary of Housing and Urban Development, in accordance with the provisions of this chapter, may make grants, for use in eliminating crime in and around public and other federally assisted low-income housing projects (1) to public housing agencies (including Indian housing authorities), and (2) to private, for profit, and nonprofit owners of federally assisted low-income housing. In designing the program, the Secretary shall consult with the Attorney General.’.

    (c) ELIGIBLE ACTIVITIES- Section 5124(a) of the Public and Assisted Housing Drug Elimination Act of 1990 (42 U.S.C. 11903(a)) is amended--

      (1) in the introductory material preceding paragraph (1), by inserting ‘and around’ after ‘used in’;

      (2) in paragraph (3), by inserting ‘, such as fencing, lighting, locking, and surveillance systems’ before the semicolon;

      (3) in paragraph (4), by striking subparagraph (A) and inserting the following new subparagraph:

        ‘(A) to investigate crime; and’;

      (4) in paragraph (6)--

        (A) by striking ‘in and around public or other federally assisted low-income housing projects’; and

        (B) by striking ‘and’ after the semicolon;

      (5) in paragraph (7)--

        (A) by striking ‘where a public housing agency receives a grant,’;

        (B) by striking ‘drug abuse’ and inserting ‘crime’; and

        (C) by striking the period at the end and inserting a semicolon; and

      (6) by adding at the end the following new paragraphs:

      ‘(8) the employment or utilization of one or more individuals, including law enforcement officers, made available by contract or other cooperative arrangement with State or local law enforcement agencies, to engage in community policing involving interaction with members of the community on proactive crime control and prevention;

      ‘(9) youth initiatives, such as activities involving training, education, after school programs, cultural programs, recreation and sports, career planning, and entrepreneurship and employment; and

      ‘(10) resident service programs, such as job training, education programs, drug and alcohol treatment, and other appropriate social services that address the contributing factors of crime.’.

    (d) APPLICATIONS- Section 5125 of the Public and Assisted Housing Drug Elimination Act of 1990 (42 U.S.C. 11904) is amended--

      (1) in subsection (a)--

        (A) by striking ‘To receive a grant’ and inserting the following:

      ‘(1) APPLICATIONS- To receive a grant’;

        (B) in the second sentence, by striking ‘drug-related crime on the premises of’ and inserting the following: ‘crime in and around’; and

        (C) by adding at the end the following new paragraphs:

      ‘(2) ONE-YEAR RENEWABLE GRANTS-

        ‘(A) IN GENERAL- Eligible applicants may submit an application for a 1-year grant under this chapter that, subject to the availability of appropriated amounts, shall be renewed annually for a period of not more than 4 years, if the Secretary finds, after an annual or more frequent performance review, that the public housing agency is performing under the terms of the grant and applicable laws in a satisfactory manner and meets such other requirements as the Secretary may prescribe.

        ‘(B) PREFERENCE- The Secretary shall accord a preference to applicants for grants under this paragraph if the grant is to be used to continue or expand activities eligible for assistance under this chapter that have received previous assistance either under this chapter, as it existed prior to the enactment of the Housing and Community Development Act of 1993, or under section 14 of the United States Housing Act of 1937. Such preference shall not preclude the selection by the Secretary of other meritorious applications, particularly applications which address urgent or severe crime problems or which demonstrate especially promising approaches to reducing crime. Such preference shall not be construed to require continuation of activities determined by the Secretary to be unworthy of continuation.

      ‘(3) PUBLIC HOUSING AGENCIES THAT HAVE ESPECIALLY SEVERE CRIME PROBLEMS- The Secretary shall, by regulation issued after notice and opportunity for public comment, set forth criteria for establishing a class of public housing agencies that have especially severe crime problems. The Secretary may allocate a portion of the annual appropriation for this program for public housing agencies in this class.’.

      (2) in subsection (b)--

        (A) by striking the introductory material preceding paragraph (1) and inserting the following: ‘The Secretary shall approve applications under subsection (a)(2) that are not subject to a preference under subsection (a)(2)(B) on the basis of--’;

        (B) in paragraph (1), by striking ‘drug-related crime problem in’ and inserting the following: ‘crime problem in and around’;

        (C) in paragraph (2), by inserting immediately after ‘crime problem in’ the following: ‘and around’; and

        (D) in paragraph (4), by inserting after ‘local government’ the following: ‘, local community-based nonprofit organizations, local resident organizations that represent the residents of neighboring projects that are owned or assisted by the Secretary,’;

      (3) in subsection (c)(2), by striking ‘drug-related’ each place it appears; and

      (4) by striking subsection (d).

    (e) DEFINITIONS- Section 5126 of the Public and Assisted Housing Drug Elimination Act of 1990 (42 U.S.C. 11905) is amended by striking paragraphs (1) and (2), and redesignating paragraphs (3) and (4) as paragraphs (1) and (2), respectively.

    (f) IMPLEMENTATION- Section 5127 of the Public and Assisted Housing Drug Elimination Act of 1990 (42 U.S.C. 11906) is amended by striking ‘Cranston-Gonzalez National Affordable Housing Act’ and inserting ‘Housing and Community Development Act of 1993’.

    (g) REPORTS- Section 5128 of the Public and Assisted Housing Drug Elimination Act of 1990 (42 U.S.C. 11907) is amended--

      (1) by striking ‘The Secretary’ and inserting the following:

    ‘(a) GRANTEE REPORTS- The Secretary’;

      (2) by striking ‘drug-related crime in’ and inserting ‘crime in and around’; and

      (3) by adding at the end the following new subsection:

    ‘(b) HUD REPORTS- The Secretary shall submit a report to the Congress describing the system used to distribute funds to grantees under this section. Such report shall include, at a minimum--

      ‘(1) a description of the criteria used to establish the class of public housing agencies with especially severe crime problems and a list of such agencies;

      ‘(2) the methodology used to distribute funds among the public housing agencies on the list created under paragraph (1); and

      ‘(3) the Secretary’s recommendations for any change to the method of distribution of funds.’.

    (h) AUTHORIZATION OF APPROPRIATIONS- Section 5130 of the Public and Assisted Housing Drug Elimination Act of 1990 (42 U.S.C. 11909) is amended--

      (1) in the first sentence of subsection (a), by striking ‘$175,000,000 for fiscal year 1993’ and all that follows through the end of the sentence and inserting ‘$265,000,000 for fiscal year 1994 and $325,000,000 for fiscal year 1995.’; and

      (2) in subsection (b)--

        (A) in the heading, by striking ‘SET-ASIDES’ and inserting ‘SET-ASIDE’; and

        (B) by striking the second sentence.

    (i) REPEAL- Section 520(k) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 11908) is hereby repealed.

    (j) TECHNICAL ASSISTANCE- The Public and Assisted Housing Drug Elimination Act of 1990 (42 U.S.C. 11901 et seq.) is further amended by adding at the end the following new section:

‘SEC. 5131. TECHNICAL ASSISTANCE.

    ‘Of the amounts appropriated annually for each of fiscal years 1994 and 1995 to carry out this chapter, the Secretary shall use not more than $10,000,000, directly or indirectly, under grants, contracts, or cooperative agreements, to provide training, information services, and other technical assistance to public housing agencies and other entities with respect to their participation in the program authorized by this chapter. Such technical assistance may include the establishment and operation of the clearinghouse on drug abuse in public housing and the regional training program on drug abuse in public housing under sections 5143 and 5144 of this Act. The Secretary is also authorized to use the foregoing amounts for obtaining assistance in establishing and managing assessment and evaluation criteria and specifications, and obtaining the opinions of experts in relevant fields.’.

TITLE III--TECHNICAL AND OTHER AMENDMENTS

Subtitle A--Public and Assisted Housing

SEC. 301. CORRECTION TO DEFINITION OF FAMILY.

    The first sentence of section 3(b)(3)(B) of the United States Housing Act of 1937 (42 U.S.C. 1437a(b)(3)(B)) is amended--

      (1) by striking ‘means’ and inserting ‘includes’; and

      (2) by inserting ‘and’ immediately after ‘children,’.

SEC. 302. IDENTIFICATION OF CIAP REPLACEMENT NEEDS.

    Section 14 of the United States Housing Act of 1937 (42 U.S.C. 1437l) is amended--

      (1) in subsection (d)--

        (A) by striking paragraph (2); and

        (B) in paragraph (4)--

          (i) by striking ‘and replacements,’; and

          (ii) by striking ‘(1), (2), and (3)’ and inserting ‘(1) and (3)’; and

      (2) in subsection (f)(1)--

        (A) by striking subparagraph (B); and

        (B) in subparagraph (D), by striking ‘(1), (2), and (3)’ and inserting ‘(1) and (3)’.

SEC. 303. APPLICABILITY OF PUBLIC HOUSING AMENDMENTS TO INDIAN HOUSING.

    (a) AMENDMENT- Section 201(b) of the United States Housing Act of 1937 (42 U.S.C. 1437aa(b)) is amended to read as follows:

    ‘(b) APPLICABILITY OF TITLE I- Except as otherwise provided by law, the provisions of title I shall apply to low-income housing developed or operated pursuant to a contract between the Secretary and an Indian housing authority.’.

    (b) APPLICABILITY OF AMENDMENT- The amendment made by subsection (a) shall not affect provisions of the United States Housing Act of 1937 that were made applicable to public housing developed or operated pursuant to a contract between the Secretary and an Indian housing authority in accordance with section 201(b)(2) of such Act, as such section existed before the effective date of this section.

    (c) APPLICABILITY OF HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1992- Sections 103(a)(1), 112, 114, 116, 118, 903, and 927 of the Housing and Community Development Act of 1992 shall apply to public housing developed or operated pursuant to a contract between the Secretary and an Indian housing authority.

SEC. 304. PROJECT-BASED ACCOUNTING.

    Section 6(c)(4)(E) of the United States Housing Act of 1937 (42 U.S.C. 1437d(c)(4)(E)) is amended by striking ‘250’ and inserting ‘500’.

SEC. 305. OPERATING SUBSIDY ADJUSTMENTS FOR ANTICIPATED FRAUD RECOVERIES.

    Section 9(a) of the United States Housing Act of 1937 (42 U.S.C. 1437g(a)) is amended by adding at the end the following new paragraph:

    ‘(4) Adjustments to a public housing agency’s operating subsidy made by the Secretary under this section shall reflect actual changes in rental income collections resulting from the application of section 904 of the Stewart B. McKinney Homeless Assistance Amendments Act of 1988.’.

SEC. 306. TECHNICAL ASSISTANCE FOR LEAD HAZARD REDUCTION GRANTEES.

    Section 1011(g) of the Housing and Community Development Act of 1992 (42 U.S.C. 5318 note) is hereby repealed.

SEC. 307. ENVIRONMENTAL REVIEW IN CONNECTION WITH GRANTS FOR LEAD-BASED PAINT HAZARD REDUCTION.

    Section 1011 of the Housing and Community Development Act of 1992 (42 U.S.C. 5318 note) is amended--

      (1) by redesignating subsection (o) as subsection (p); and

      (2) by adding after subsection (n) the following new subsection:

    ‘(o) ENVIRONMENTAL REVIEW-

      ‘(1) IN GENERAL- For purposes of environmental review, decisionmaking, and action pursuant to the National Environmental Policy Act of 1960 and other provisions of law that further the purposes of such Act, a grant under this section shall be treated as assistance under the HOME Investment Partnership Act, established under title II of the Cranston-Gonzalez National Affordable Housing Act, and shall be subject to the regulations promulgated by the Secretary to implement section 288 of such Act.

      ‘(2) APPLICABILITY- This subsection shall apply to--

        ‘(A) grants awarded under this section; and

        ‘(B) grants awarded to States and units of general local government for the abatement of significant lead-based paint and lead dust hazards in low- and moderate-income owner-occupied units and low-income privately owned rental units pursuant to title II of the Departments of Veterans Affairs and Housing and Urban Development, and Independent Agencies Appropriations Act, 1992 (Public Law 102-139, 105 Stat. 736).’.

SEC. 308. FIRE SAFETY IN FEDERALLY ASSISTED HOUSING.

    Section 31(c)(2)(A)(i) of the Federal Fire Prevention and Control Act of 1974 (15 U.S.C. 2227(c)(2)(A)(i)) is amended by adding ‘(or equivalent level of safety)’ after ‘system’.

SEC. 309. SECTION 23 CONVERSION PROJECTS.

    (a) SECTION 23 CONVERSION-

      (1) AUTHORIZATION- Notwithstanding contracts entered into pursuant to section 14(b)(2) of the United States Housing Act of 1937, the Secretary is authorized to enter into obligations for conversion of Leonard Terrace Apartments in Grand Rapids, Michigan, from a leased housing contract under section 23 of such Act to a project-based rental assistance contract under section 8 of such Act.

      (2) REPAYMENT REQUIRED- The authorization made in paragraph (1) is conditioned on the repayment to the Secretary of all amounts received by the public housing agency under the comprehensive improvement assistance program under section 14 of the United States Housing Act of 1937 for the Leonard Terrace Apartment project and the amounts, as determined by the Secretary, received by the public housing agency under the formula in section 14(k) of such Act by reason of the project.

    (b) CONTRACT RENEWAL-

      (1) IN GENERAL- Leased housing contracts under section 23 of the United States Housing Act of 1937, as such section existed before the date of enactment of the Housing and Community Development Act of 1974, that--

        (A) were converted to section 8 contracts on terms similar to or the same as the terms of the section 8 new construction program; and

        (B) expire during fiscal year 1994 or 1995;

      shall be extended for a period not to exceed 5 years as if the rents on such projects were established under the section 8 new construction program, except that section 8(c)(2)(C) of the United States Housing Act of 1937 shall not apply to such contracts.

      (2) BUDGET COMPLIANCE- To the extent that paragraph (1) results in additional costs under this section, such paragraph shall be effective only to the extent that amounts to cover such additional costs are provided in advance in appropriation Acts.

SEC. 310. INDEMNIFICATION OF CONTRACTORS FOR INTELLECTUAL PROPERTY RIGHTS DISPUTES.

    A recipient of Federal housing assistance may not use such funds to indemnify contractors or subcontractors against costs associated with litigating or settling disputes concerning the infringement of intellectual property rights.

SEC. 311. ASSUMPTION OF ENVIRONMENTAL REVIEW RESPONSIBILITIES UNDER UNITED STATES HOUSING ACT OF 1937 PROGRAMS.

    Title I of the United States Housing Act of 1937 (42 U.S.C. 1437 et seq.) is amended by adding at the end the following new section:

‘SEC. 26. ENVIRONMENTAL REVIEWS.

    ‘(a) IN GENERAL-

      ‘(1) RELEASE OF FUNDS- In order to assure that the policies of the National Environmental Policy Act of 1969 and other provisions of law which further the purposes of such Act (as specified in regulations issued by the Secretary) are most effectively implemented in connection with the expenditure of funds under this title, and to assure to the public undiminished protection of the environment, the Secretary may, under such regulations, in lieu of the environmental protection procedures otherwise applicable, provide for the release of funds for projects or activities under this title, as specified by the Secretary upon the request of a public housing agency under this section, if the State or unit of general local government, as designated by the Secretary in accordance with regulations, assumes all of the responsibilities for environmental review, decisionmaking, and action pursuant to such Act, and such other provisions of law as the regulations of the Secretary may specify, which would otherwise apply to the Secretary with respect to the release of funds.

      ‘(2) IMPLEMENTATION- The Secretary, after consultation with the Council on Environmental Quality, shall issue such regulations as may be necessary to carry out this section. Such regulations shall specify the programs to be covered.

    ‘(b) PROCEDURE- The Secretary shall approve the release of funds subject to the procedures authorized by this section only if, not less than 15 days prior to such approval and prior to any commitment of funds to such projects or activities, the public housing agency has submitted to the Secretary a request for such release accompanied by a certification of the State or unit of general local government which meets the requirements of subsection (c). The Secretary’s approval of any such certification shall be deemed to satisfy the Secretary’s responsibilities under the National Environmental Policy Act of 1969 and such other provisions of law as the regulations of the Secretary specify insofar as those responsibilities relate to the release of funds which are covered by such certification.

    ‘(c) CERTIFICATION- A certification under the procedures authorized by this section shall--

      ‘(1) be in a form acceptable to the Secretary;

      ‘(2) be executed by the chief executive officer or other officer of the State or unit of general local government who qualifies under regulations of the Secretary;

      ‘(3) specify that the State or unit of general local government under this section has fully carried out its responsibilities as described under subsection (a); and

      ‘(4) specify that the certifying officer--

        ‘(A) consents to assume the status of a responsible Federal official under the National Environmental Policy Act of 1969 and agrees to comply with each provision of law specified in regulations issued by the Secretary insofar as the provisions of such Act or other such provision of law apply pursuant to subsection (a); and

        ‘(B) is authorized and consents on behalf of the State or unit of general local government and himself or herself to accept the jurisdiction of the Federal courts for the purpose of enforcement of his or her responsibilities as such an official.

    ‘(d) APPROVAL BY STATES- In cases in which a unit of general local government carries out the responsibilities described in subsection (c), the Secretary may permit the State to perform those actions of the Secretary described in subsection (b) and the performance of such actions by the State, where permitted by the Secretary, shall be deemed to satisfy the Secretary’s responsibilities referred to in the second sentence of subsection (b).’.

SEC. 312. INCREASED STATE FLEXIBILITY IN THE LOW-INCOME HOME ENERGY ASSISTANCE PROGRAM.

    Section 927 of the Housing and Community Development Act of 1992 (42 U.S.C. 8624) is amended--

      (1) in subsection (a)--

        (A) in the heading, by striking ‘(a) ELIGIBILITY- ’ and inserting the following:

    ‘(a) IN GENERAL- ’;

        (B) by striking ‘(including but not limited to the Low-Income Home Energy Assistance Program)’; and

        (C) by inserting ‘, except as provided in subsection (d)’ before the period at the end;

      (2) in subsection (b)--

        (A) by striking ‘such’ and inserting ‘or receiving energy’; and

        (B) by inserting before the period at the end ‘for any program in which eligibility or benefits are based on need, except as provided in subsection (d)’; and

      (3) by adding at the end the following new subsection:

    ‘(d) SPECIAL RULE FOR LOW-INCOME HOME ENERGY ASSISTANCE PROGRAM- For purposes of the Low-Income Home Energy Assistance Program, tenants described in subsection (a)(2) shall not have their eligibility automatically denied. States may consider the amount of the heating or cooling component of utility allowances received by such tenants when setting benefit levels under the Low-Income Home Energy Assistance Program. Any reduction in fuel assistance benefits must be reasonably related to the amount of the heating or cooling component of the utility allowance received. States shall ensure that the highest level of assistance will be provided to those households with the highest energy burdens, in accordance with section 2605(b)(5) of the Low-Income Home Energy Assistance Act of 1981.’.

Subtitle B--Multifamily Housing

SEC. 321. CORRECTION OF MULTIFAMILY MORTGAGE LIMITS.

    The National Housing Act (12 U.S.C. 1701 et seq.) is amended in sections 207(c)(3), 213(b)(2), 220(d)(3)(B)(iii), and 234(e)(3) by striking ‘$59,160’ each place it appears and inserting ‘$56,160’.

SEC. 322. FHA MULTIFAMILY RISK-SHARING; HFA PILOT PROGRAM AMENDMENTS.

    (a) IN GENERAL- Section 542(c) of the Housing and Community Development Act of 1992 (12 U.S.C. 1707 note) is amended--

      (1) in paragraph (1), by inserting after ‘qualified housing finance agencies’ the following: ‘(including entities established by States that provide mortgage insurance)’;

      (2) in paragraph (2)--

        (A) in subparagraph (C), by striking the last sentence and inserting the following: ‘Such agreements shall specify that the qualified housing finance agency and the Secretary shall share any loss in accordance with the risk-sharing agreement.’; and

        (B) by adding at the end the following new subparagraph:

        ‘(F) DISCLOSURE OF RECORDS- Qualified housing finance agencies shall make available to the Secretary such financial and other records as the Secretary deems necessary for program review and monitoring purposes.’;

      (3) in paragraph (7)--

        (A) by striking ‘very low-income’; and

        (B) by striking ‘(2)’; and

      (4) by adding at the end the following new paragraphs:

      ‘(9) ENVIRONMENTAL AND OTHER REVIEWS-

        ‘(A) ENVIRONMENTAL REVIEWS-

          ‘(i) IN GENERAL- (I) In order to assure that the policies of the National Environmental Policy Act of 1969 and other provisions of law which further the purposes of such Act (as specified in regulations issued by the Secretary) are most effectively implemented in connection with the insurance of mortgages under subsection (c)(2), and to assure to the public undiminished protection of the environment, the Secretary may, under such regulations, in lieu of the environmental protection procedures otherwise applicable, provide for agreements to endorse for insurance mortgages under subsection (c)(2) upon the request of qualified housing finance agencies under this subsection, if the State or unit of general local government, as designated by the Secretary in accordance with regulations, assumes all of the responsibilities for environmental review, decisionmaking, and action pursuant to such Act, and such other provisions of law as the regulations of the Secretary may specify, that would otherwise apply to the Secretary with respect to the insurance of mortgages on particular properties.

          ‘(II) The Secretary shall issue regulations to carry out this subparagraph only after consultation with the Council on Environmental Quality. Such regulations shall, among other matters, provide--

            ‘(aa) for the monitoring of the performance of environmental reviews under this subparagraph;

            ‘(bb) subject to the discretion of the Secretary, for the provision or facilitation of training for such performance; and

            ‘(cc) subject to the discretion of the Secretary, for the suspension or termination by the Secretary of the qualified housing finance agency’s responsibilities under subclause (I).

          ‘(III) The Secretary’s duty under subclause (II) shall not be construed to limit any responsibility assumed by a State or unit of general local government with respect to any particular property under subclause (I).

          ‘(ii) PROCEDURE- The Secretary shall approve a mortgage for the provision of mortgage insurance subject to the procedures authorized by this paragraph only if, not less than 15 days prior to such approval, prior to any approval, commitment, or endorsement of mortgage insurance on the property on behalf of the Secretary, and prior to any commitment by the qualified housing finance agency to provide financing under the risk-sharing agreement with respect to the property, the qualified housing finance agency submits to the Secretary a request for such approval, accompanied by a certification of the State or unit of general local government that meets the requirements of clause (iii). The Secretary’s approval of any such certification shall be deemed to satisfy the Secretary’s responsibilities under the National Environmental Policy Act of 1969 and such other provisions of law as the regulations of the Secretary specify insofar as those responsibilities relate to the provision of mortgage insurance on the property that is covered by such certification.

          ‘(iii) CERTIFICATION- A certification under the procedures authorized by this paragraph shall--

            ‘(I) be in a form acceptable to the Secretary;

            ‘(II) be executed by the chief executive officer or other officer of the State or unit of general local government who qualifies under regulations of the Secretary;

            ‘(III) specify that the State or unit of general local government under this section has fully carried out its responsibilities as described under clause (i); and

            ‘(IV) specify that the certifying officer consents to assume the status of a responsible Federal official under the National Environmental Policy Act of 1969 and under each provision of law specified in regulations issued by the Secretary insofar as the provisions of such Act or such other provisions of law apply pursuant to clause (i), and is authorized and consents on behalf of the State or unit of general local government and himself or herself to accept the jurisdiction of the Federal courts for the purpose of enforcement of the responsibilities as such an official.

          ‘(iv) APPROVAL BY STATES- In cases in which a unit of general local government carries out the responsibilities described in clause (i), the Secretary may permit the State to perform those actions of the Secretary described in clause (ii) and the performance of such actions by the State, where permitted by the Secretary, shall be deemed to satisfy the Secretary’s responsibilities referred to in the second sentence of clause (ii).

        ‘(B) LEAD-BASED PAINT POISONING PREVENTION- In carrying out the requirements of section 302 of the Lead-Based Paint Poisoning Prevention Act, the Secretary may provide by regulation for the assumption of all or part of the Secretary’s duties under such Act by qualified housing finance agencies, for purposes of this section.

        ‘(C) CERTIFICATION OF SUBSIDY LAYERING COMPLIANCE- The requirements of section 102(d) of the Department of Housing and Urban Development Reform Act of 1989 may be satisfied in connection with a commitment to insure a mortgage under this subsection by a certification by a housing credit agency (including an entity established by a State that provides mortgage insurance) to the Secretary that the combination of assistance within the jurisdiction of the Secretary and other government assistance provided in connection with a property for which a mortgage is to be insured shall not be any greater than is necessary to provide affordable housing.

      ‘(10) DEFINITIONS- For purposes of this subsection, the following definitions shall apply:

        ‘(A) MORTGAGE- The term ‘mortgage’ means a first mortgage on real estate that is--

          ‘(i) owned in fee simple; or

          ‘(ii) subject to a leasehold interest that--

            ‘(I) has a term of not less than 99 years and is renewable; or

            ‘(II) has a remaining term that extends beyond the maturity of the mortgage for a period of not less than 10 years.

        ‘(B) FIRST MORTGAGE- The term ‘first mortgage’ means a single first lien given to secure advances on, or the unpaid purchase price of, real estate, under the laws of the State in which the real estate is located, together with the credit instrument, if any, secured thereby. Any other financing permitted on property insured under this section must be expressly subordinate to the insured mortgage.

        ‘(C) UNIT OF GENERAL LOCAL GOVERNMENT; STATE- The terms ‘unit of general local government’ and ‘State’ have the same meanings as in section 102(a) of the Housing and Community Development Act of 1974.’.

    (b) DEFINITION OF MULTIFAMILY HOUSING- Section 544(1) of the Housing and Community Development Act of 1992 (12 U.S.C. 1707 note) is amended to read as follows:

      ‘(1) The term ‘multifamily housing’ means housing accommodations on the mortgaged property that are designed principally for residential use, conform to standards satisfactory to the Secretary, and consist of not less than 5 rental units on 1 site. These units may be detached, semidetached, row house, or multifamily structures.’.

SEC. 323. SUBSIDY LAYERING REVIEW.

    Section 911 of the Housing and Community Development Act of 1992 (42 U.S.C. 3545 note) is amended--

      (1) by striking subsection (a) and inserting the following:

    ‘(a) CERTIFICATION OF SUBSIDY LAYERING COMPLIANCE- The requirements of section 102(d) of the Department of Housing and Urban Development Reform Act of 1989 may be satisfied in connection with a project receiving assistance under a program that is within the jurisdiction of the Department of Housing and Urban Development and under section 42 of the Internal Revenue Code of 1986 by a certification by a housing credit agency to the Secretary, submitted in accordance with guidelines established by the Secretary, that the combination of assistance within the jurisdiction of the Secretary and other government assistance provided in connection with a property for which assistance is to be provided within the jurisdiction of the Department of Housing and Urban Development and under section 42 of the Internal Revenue Code of 1986 shall not be any greater than is necessary to provide affordable housing.’; and

      (2) by striking subsection (c) and inserting the following:

    ‘(c) REVOCATION BY SECRETARY- If the Secretary determines that a housing credit agency has failed to comply with the guidelines established under subsection (a), the Secretary--

      ‘(1) may inform the housing credit agency that the agency may no longer submit certification of subsidy layering compliance under this section; and

      ‘(2) shall carry out section 102(d) of the Housing and Urban Development Reform Act relating to affected projects allocated a low-income housing tax credit pursuant to section 42 of the Internal Revenue Code of 1986.’.

Subtitle C--Miscellaneous and Technical Amendments

SEC. 331. TECHNICAL CORRECTION TO RURAL HOUSING PRESERVATION PROGRAM.

    Section 515(c)(1) of the Housing Act of 1949 (42 U.S.C. 1485(c)(1)) is amended by striking ‘December 21, 1979’ and inserting ‘December 15, 1989’.

SEC. 332. CDBG TECHNICAL AMENDMENT.

    Notwithstanding any other provision of law, the city of Slidell, Louisiana may submit, not later than 10 days following the enactment of this Act, and the Secretary of Housing and Urban Development shall consider and accept, the final statement of community development objectives and projected use of funds required by section 104(a)(1) of the Housing and Community Development Act of 1974 in connection with a grant to the city of Slidell under title 1 of such Act for fiscal year 1994.

SEC. 333. ENVIRONMENTAL REVIEW IN CONNECTION WITH SPECIAL PROJECTS.

    (a) IN GENERAL-

      (1) RELEASE OF FUNDS- In order to assure that the policies of the National Environmental Policy Act of 1969 and other provisions of law which further the purposes of such Act (as specified in regulations issued by the Secretary) are most effectively implemented in connection with the expenditure of funds for special projects appropriated under an appropriations Act for the Department of Housing and Urban Development, such as special projects under the head ‘Annual Contributions for Assisted Housing’ in title II of the Departments of Veterans Affairs and Housing and Urban Development, and Independent Agencies Appropriations Act, 1993, and to assure to the public undiminished protection of the environment, the Secretary of Housing and Urban Development may, under such regulations, in lieu of the environmental protection procedures otherwise applicable, provide for the release of funds for particular special projects upon the request of recipients of special projects assistance, if the State or unit of general local government, as designated by the Secretary in accordance with regulations, assumes all of the responsibilities for environmental review, decisionmaking, and action pursuant to such Act, and such other provisions of law as the regulations of the Secretary specify, that would otherwise apply to the Secretary were the Secretary to undertake such special projects as Federal projects.

      (2) IMPLEMENTATION- The Secretary shall issue regulations to carry out this section only after consultation with the Council on Environmental Quality. Such regulations shall--

        (A) provide for monitoring of the performance of environmental reviews under this section;

        (B) in the discretion of the Secretary, provide for the provision or facilitation of training for such performance; and

        (C) subject to the discretion of the Secretary, provide for suspension or termination by the Secretary of the assumption under paragraph (1).

      (3) RESPONSIBILITIES OF STATE OR UNIT OF GENERAL LOCAL GOVERNMENT- The Secretary’s duty under paragraph (2) shall not be construed to limit any responsibility assumed by a State or unit of general local government with respect to any particular release of funds under paragraph (1).

    (b) PROCEDURE- The Secretary shall approve the release of funds for projects subject to the procedures authorized by this section only if, not less than 15 days prior to such approval and prior to any commitment of funds to such projects, the recipient submits to the Secretary a request for such release, accompanied by a certification of the State or unit of general local government which meets the requirements of subsection (c). The Secretary’s approval of any such certification shall be deemed to satisfy the Secretary’s responsibilities under the National Environmental Policy Act of 1969 and such other provisions of law as the regulations of the Secretary specify insofar as those responsibilities relate to the releases of funds for special projects to be carried out pursuant thereto which are covered by such certification.

    (c) CERTIFICATION- A certification under the procedures authorized by this section shall--

      (1) be in a form acceptable to the Secretary;

      (2) be executed by the chief executive officer or other officer of the State or unit of general local government who qualifies under regulations of the Secretary;

      (3) specify that the State or unit of general local government under this section has fully carried out its responsibilities as described under subsection (a); and

      (4) specify that the certifying officer--

        (A) consents to assume the status of a responsible Federal official under the National Environmental Policy Act of 1969 and agrees to comply with each provision of law specified in regulations issued by the Secretary insofar as the provisions of such Act or other such provision of law apply pursuant to subsection (a); and

        (B) is authorized and consents on behalf of the State or unit of general local government and himself or herself to accept the jurisdiction of the Federal courts for the purpose of enforcement of the responsibilities as such an official.

    (d) APPROVAL BY STATES- In cases in which a unit of general local government carries out the responsibilities described in subsection (a), the Secretary may permit the State to perform those actions of the Secretary described in subsection (b) and the performance of such actions by the State, where permitted by the Secretary, shall be deemed to satisfy the Secretary’s responsibilities referred to in the second sentence of subsection (b).

TITLE IV--GENERAL PROVISIONS

SEC. 401. MOUNT RUSHMORE COMMEMORATIVE COIN ACT.

    (a) DISTRIBUTION OF SURCHARGES- Section 8 of the Mount Rushmore Commemorative Coin Act (31 U.S.C. 5112 note) is amended by striking paragraphs (1) and (2) and inserting the following:

      ‘(1) the first $18,750,000 shall be paid during fiscal year 1994 by the Secretary to the Society to assist the Society’s efforts to improve, enlarge, and renovate the Mount Rushmore National Memorial; and

      ‘(2) the remainder shall be returned to the United States Treasury for purposes of reducing the national debt.’.

    (b) RETROACTIVE EFFECT- If, prior to the date of enactment of this Act, any amount of surcharges have been received by the Secretary of the Treasury and paid into the United States Treasury pursuant to section 8(1) of the Mount Rushmore Commemorative Coin Act, as in effect prior to the date of enactment of this Act, that amount shall be paid out of the Treasury to the extent necessary to comply with section 8(1) of the Mount Rushmore Commemorative Coin Act, as in effect after the date of enactment of this Act. Amounts paid pursuant to the preceding sentence shall be out of funds not otherwise appropriated.

SEC. 402. MINORITY COMMUNITY DEVELOPMENT GRANTS FOR COMMUNITIES WITH SPECIAL NEEDS.

    (a) AUTHORIZATION- There are hereby authorized to be expended from sums appropriated for water infrastructure financing and other wastewater activities for cities with special needs, not more than $25,000,000, for wastewater treatment projects, including the construction of facilities and related expenses in minority communities with special needs to--

      (1) improve the housing stock infrastructure in the special needs communities; and

      (2) abate health hazards caused by groundwater contamination from septage in arid areas with high groundwater levels.

    (b) TREATMENT PROJECTS- The wastewater treatment projects authorized under this section shall include innovative technologies such as vacuum systems and constructed wetlands.

    (c) DEFINITIONS- For purposes of this section--

      (1) the term ‘cities with special needs’ includes minority communities with special needs;

      (2) the term ‘minority’ means an African-American, a Hispanic-American, an Asian-American, or a Native American; and

      (3) the term ‘minority community with special needs’ means an unincorporated community--

        (A) that, based on the latest census data, has a minority population in excess of 50 percent;

        (B) that has been unable to issue bonds or otherwise finance a wastewater treatment system itself because its attempts to change its political subdivision have been rejected by the State legislature; and

        (C) for which the State legislature has appropriated funds to help pay for a wastewater treatment project.

Passed the Senate November 19 (legislative day, November 2), 1993.

Attest:

Secretary.

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