90 S2820 IS: Decent, Affordable, Safe Housing for all Act
U.S. Senate
2021-09-23
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EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
1.Short title; table of contents(a)This Act may be cited as the Decent, Affordable, Safe Housing for all Act
or the DASH Act
.(b)The table of contents for this Act is as follows:Sec. 1. Short title; table of contents.Sec. 2. Findings.TITLE I—Housing assistanceSubtitle A—General housing assistanceSec. 111. Rental vouchers for the homeless.Sec. 112. Land acquisition and construction.Sec. 113. Modular construction pilot program.Sec. 114. Supporting pro-housing development.Sec. 115. Permanent authorization of appropriations for McKinney-Vento Homeless Assistance Act grants.Subtitle B—Rural housing assistanceSec. 121. Rural housing reinvestment.Sec. 122. Permanent establishment of housing preservation and revitalization program.Sec. 123. Eligibility for rural housing vouchers.Sec. 124. Amount of voucher assistance.Sec. 125. Use of available rental assistance.Sec. 126. Funding for multifamily technical improvements.Sec. 127. Plan for preserving affordability of rental projects.Sec. 128. Covered housing programs.TITLE II—Revenue provisionsSec. 201. Extension of period for rehabilitation expenditures.Sec. 202. Extension of basis expenditure deadline.Sec. 203. Tax-exempt bond financing requirement.Sec. 204. Increases in State allocations.Sec. 205. Buildings designated to serve extremely low-income households.Sec. 206. Inclusion of Indian areas as difficult development areas for purposes of certain buildings.Sec. 207. Inclusion of rural areas as difficult development areas.Sec. 208. Increase in credit for bond-financed projects designated by housing credit agency.Sec. 209. Repeal of qualified contract option.Sec. 210. Modification and clarification of rights relating to building purchase.Sec. 211. Prohibition of local approval and contribution requirements.Sec. 212. Adjustment of credit to provide relief during COVID–19 outbreak.Sec. 213. Increase in credit for low-income housing supportive services.Sec. 214. Study of tax incentives for the conversion of commercial property to affordable housing.Sec. 215. Renters credit.Sec. 216. Middle-income housing tax credit.Sec. 217. Neighborhood homes credit.Sec. 218. First-time homebuyer refundable credit.2.Congress finds the following:(1)The United States has a deficit of 7,000,000 units of housing due to slowed development after the Great Recession. Public-private partnerships can spark a boost in construction to address this lack of available and affordable homes.(2)During the last 20 years, rent has increased faster than income for renters in all 50 States and the District of Columbia.(3)There is no county in the United States in which an individual working at minimum wage can afford a modest 1- or 2-bedroom home. A renter would need to make more than $20 an hour to afford the average 1-bedroom rent. In no State does the minimum wage exceed $16 an hour.(4)Artificial limits on construction and development of diverse types of housing limit supply, increase housing prices, and often induce sprawl.(5)The most affordable and environmentally friendly types of housing developments are illegal in many jurisdictions in the United States. Dense, multifamily housing creates far fewer carbon emissions than standalone single-family housing.(6)In 10 States, Housing Choice Voucher recipients wait longer than 3 years for assistance. Nationwide, only 1 in 4 households eligible for housing assistance receives it.(7)More than 1,500,000 children in the United States experienced homelessness in 2018, including students staying in other people’s homes due to lack of alternatives. More than 11,000 children were living outside in 2020. Children living in or exiting the child welfare system are especially vulnerable to homelessness.(8)The strongest indicator that a person will experience homelessness as an adult is if the person experienced homelessness as a child. Experiencing homelessness harms children educationally, socially, emotionally, and physically.(9)Unsheltered homelessness has increased in recent years, and Black, Indigenous, and Hispanic Americans are severely overrepresented in the population of people experiencing homelessness.(10)Extremely low-income renters are much more likely to be non-White, as 1 in 5 Black renters, 18 percent of Indigenous renters, and 16 percent of Hispanic renters are extremely low-income, while only 6 percent of White renters are extremely low-income.(11)In 2020, the difference in homeownership rates between Black and White Americans was larger than in 1960, before the enactment of the Fair Housing Act (title VIII of Public Law 90–284; 82 Stat. 81), reflecting the pervasive impact of systemic racism in the housing market and overall economy including redlining, appraisal bias, wage gaps, and decades-long oppression.(12)Stable, safe, and affordable housing is a significant social indicator of health, and investments in affordable housing result in tangible benefits in neighborhood, household, and individual health and economic stability.<enum>I</enum><header>Housing assistance</header><subtitle style="OLC" id="idA4B0011DD85B4CEFADD370C38FFAD4B2"><enum>A</enum><header>General housing assistance</header><section id="id5F8580F6A24E4679B0967CA1ADED2AF7"><enum>111.</enum><header>Rental vouchers for the homeless</header><text display-inline="no-display-inline">Section 8(o) of the United States Housing Act of 1937 (<external-xref legal-doc="usc" parsable-cite="usc/42/1437f">42 U.S.C. 1437f(o)</external-xref>) is amended by adding at the end the following:</text><quoted-block style="OLC" display-inline="no-display-inline" id="id1D356C82A6854300A220D97E0C63E59E"><paragraph id="id805C3082C97B456189249C84571500B2"><enum>(21)</enum><header>Rental vouchers for the homeless</header><subparagraph id="id0B268C187F094552B79ADE1CF2730531"><enum>(A)</enum><header>Definitions</header><text>In this paragraph:</text><clause id="idCA7798BB5B664CD28F6DD33C845FEE4B"><enum>(i)</enum><header>At risk of homelessness</header><text>The term <term>at risk of homelessness</term> has the meaning given the term in section 401(1) of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11360">42 U.S.C. 11360</external-xref>), except that <quote>50 percent</quote> shall be substituted for <quote>30 percent</quote> in subparagraph (A) of that section.</text></clause><clause id="id894D9F1BDB1E466AAB4506893D14FF0B"><enum>(ii)</enum><header>Capacity-building period</header><text>The term <term>capacity-building period</term> means the 2-year period beginning on the date on which the formula is established under subparagraph (E)(ii).</text></clause><clause id="idB6C4E93130D3486584F56268E2AF3C92"><enum>(iii)</enum><header>Continuum of care</header><text>The term <term>continuum of care</term> has the meaning given the term in section 578.3 of title 24, Code of Federal Regulations, or any successor regulation.</text></clause><clause id="idBC4235DFBF394755A8666D4C1F9EF31B"><enum>(iv)</enum><header>Eligible public housing agency</header><text>The term <term>eligible public housing agency</term> means a public housing agency that—</text><subclause id="id08F919FD7B99458DB7EB2E224FD88DBE"><enum>(I)</enum><text>administers assistance under this subsection through a contract for annual contributions entered into with the Secretary;</text></subclause><subclause id="idDDD7BA34C5E744D3A7E9731C16002635"><enum>(II)</enum><text>has a partnership with a public child welfare agency and a continuum of care that—</text><item id="id3A2184E6A3CE424E97573A84462A7B0E"><enum>(aa)</enum><text>has a system for identifying and referring eligible recipients for assistance under this paragraph from the public housing agency, including by providing a written certification that the eligible recipient is eligible to receive the assistance; and</text></item><item id="id7BD8106411624514A7768B4D9BAE0AD3"><enum>(bb)</enum><text>will, to the greatest extent practicable, provide or facilitate the provision of supportive services to those eligible recipients; and</text></item></subclause><subclause id="idD1A43935969E496DAAFCEBC845645070"><enum>(III)</enum><text>submits to the Secretary a statement describing—</text><item id="id92C4E000569546E99EBEB0C51DEDB2CF"><enum>(aa)</enum><text>how the public housing agency will connect eligible recipients with local community resources, to the extent available; and</text></item><item id="idB373402088444EEE9664C2040D0134D0"><enum>(bb)</enum><text>the plan for use of capacity-building funding under subparagraph (E), including—</text><subitem id="id9A598CEEBC074C9DB26990F82B021AA9"><enum>(AA)</enum><text>a timeline for the use of that funding within the capacity-building period;</text></subitem><subitem id="id734B328EDE3942E6B1869FC563C66F6F"><enum>(BB)</enum><text>hiring and personnel needs;</text></subitem><subitem id="id0F6C64EA6098498DB7898C1872763DB8"><enum>(CC)</enum><text>physical infrastructure needs; and</text></subitem><subitem id="id53ED1A7BB0F945378898EC87B691F2F3"><enum>(DD)</enum><text>technological infrastructure needs, including upgrades to the HMIS, and any other capacity-related investments that are necessary to administer assistance under this paragraph.</text></subitem></item></subclause></clause><clause id="idD625B52D3BF24BA298C9261345CDCAB5"><enum>(v)</enum><header>Eligible recipient</header><text>The term <term>eligible recipient</term> means any individual or family experiencing homelessness or at risk of homelessness with an income that is less than 50 percent of the area median income.</text></clause><clause id="idD70DA919587A421498336423C53D1C21"><enum>(vi)</enum><header>Experiencing homelessness; homeless</header><text>The terms <term>experiencing homelessness</term> and <term>homeless</term> means an individual or family who is—</text><subclause id="id89F7C7D73839418DB035FAA896DA3209"><enum>(I)</enum><text>living in a place not meant for human habitation or in an emergency shelter;</text></subclause><subclause id="id6223A636519E4A9FACB3F70FB11DE389"><enum>(II)</enum><text>living in transitional housing for homeless persons and was homeless before entering transitional housing or an emergency shelter;</text></subclause><subclause id="idC7E01E0200BA4FE08EF6977A21EED9EF"><enum>(III)</enum><text>fleeing domestic violence; or</text></subclause><subclause id="idEC08DB3F03144D259A6096B8D96256A0"><enum>(IV)</enum><text>at risk of homelessness.</text></subclause></clause><clause id="id48C6A10FC42642A3B18283A370B4CBEA"><enum>(vii)</enum><header>HMIS</header><text>The term <term>HMIS</term> means the community-wide homeless management information system described in section 402(f)(3)(D) of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11360a">42 U.S.C. 11360a(f)(3)(D)</external-xref>).</text></clause><clause id="id06ABA283DFB847DEA69FA47C544CDAB2"><enum>(viii)</enum><header>Public housing agency</header><text>The term <term>public housing agency</term> includes a tribally designated housing entity.</text></clause><clause id="idB42DD29F7414470099D2187C37A25F6C"><enum>(ix)</enum><header>Referral</header><text>The term <term>referral</term> means an affirmative connection between the voucher recipient and the organization providing services to the voucher recipient.</text></clause><clause id="idf36dcf0c3e634f70886a3d805296e045"><enum>(x)</enum><header>Service coordinator</header><text>The term <term>service coordinator</term> means an individual employed directly by a public housing agency who provides general case management and referral services to each voucher recipient served by the public housing agency, which shall include—</text><subclause id="idBE8527EE4E0446B6AD2803BD10A0B9C8"><enum>(I)</enum><text>an individual intake screening of each voucher recipient to evaluate the voucher recipient’s need for supportive services; and</text></subclause><subclause id="id9E1AC97A213144C3AD6A791D2F6581E8"><enum>(II)</enum><text>referral to outside services, including cooperation and collaboration with a continuum of care.</text></subclause></clause><clause id="id86883C4F398E46A9A063D69B133108CE"><enum>(xi)</enum><header>Source of income</header><text>The term <term>source of income</term> means income from any lawful source, including—</text><subclause id="id81E6D580EC7B4F9489566EFAB2FF96A4"><enum>(I)</enum><text>income from any legal employment; and</text></subclause><subclause id="id4DC0E5E0F63448B88B5C932F64D0A7B1"><enum>(II)</enum><text>any assistance, benefit, or subsidy through any Federal, State, or local program, whether the program is administered by a governmental or nongovernmental entity.</text></subclause></clause><clause id="idCAD7CC1CD42A446B8F6DC9CE7A9C1346"><enum>(xii)</enum><header>Tribally designated housing entity</header><text>The term <term>tribally designated housing entity</term> has the meaning given the term in section 4 of the Native American Housing Assistance and Self-Determination Act of 1996 (<external-xref legal-doc="usc" parsable-cite="usc/25/4103">25 U.S.C. 4103</external-xref>). </text></clause><clause id="idE1E6E887EE6746058BE368966AD95C4F"><enum>(xiii)</enum><header>Voucher recipient</header><text>The term <term>voucher recipient</term> means an individual or family receiving a voucher under this paragraph.</text></clause><clause id="id5A9CCA03594D472B808DFE05E612802A"><enum>(xiv)</enum><header>Youth</header><text>The term <term>youth</term> means an individual under the age of 25.</text></clause></subparagraph><subparagraph id="idD2DE848C9FF94580B3C02011F707558B"><enum>(B)</enum><header>Vouchers</header><clause id="id070FAE3779D04D4792E26177C91B8E78"><enum>(i)</enum><header>Provision of vouchers</header><subclause id="id8705B14315B44C9A8C6F4EAE6A25CFE2"><enum>(I)</enum><header>In general</header><text>The Secretary shall provide vouchers for rental assistance on behalf of each eligible recipient in accordance with this paragraph.</text></subclause><subclause id="id2558816439E141E28E355328E93D8E57"><enum>(II)</enum><header>Direct appropriation</header><text>Subject to subclause (III), there is appropriated, out of any money in the Treasury not otherwise appropriated, for providing rental voucher assistance under this paragraph for fiscal year 2022 and each fiscal year thereafter—</text><item id="id0392DC61B0A548D9B3A593BB33DC6FDF"><enum>(aa)</enum><text>the amount necessary to fund the provision of a voucher for rental assistance under this paragraph on behalf of each eligible recipient;</text></item><item id="id33F1DE853C2A419BA7B2EDFC8A511DC3"><enum>(bb)</enum><text>the amount necessary to provide administrative fees under clause (ii) in connection to each voucher for rental assistance provided under this paragraph; and</text></item><item id="idC0EB6DB7B87B43CDBFA7BE7096B8FF37"><enum>(cc)</enum><text>the amount necessary to fund annual renewals of the vouchers provided under this paragraph.</text></item></subclause><subclause id="id5D6764B0240A420CAE4005C3A1E32CD9"><enum>(III)</enum><header>Number of vouchers</header><text>The Secretary shall provide—</text><item id="idA651C117B0F740F2845925977A6007D3"><enum>(aa)</enum><text>250,000 vouchers under this paragraph in fiscal year 2022; and</text></item><item id="idD5321D643FFF406297131C11E24D434E"><enum>(bb)</enum><text>400,000 vouchers under this paragraph in each fiscal year thereafter until the Secretary determines that a smaller number of vouchers is sufficient to provide all eligible recipients with vouchers.</text></item></subclause></clause><clause id="idb8358bbac0194642988e026f75b5ced8"><enum>(ii)</enum><header>Administrative fee for ancillary costs</header><text>The Secretary shall provide a public housing agency that requests a voucher under this paragraph an administrative fee sufficient to provide assistance to the voucher recipient for security deposits, moving costs, first or last month's rent, or other significant barriers to establishing use of the voucher and a lease, in an amount that is not more than 3 months' rent for the voucher recipient.</text></clause><clause id="id9BB7805D61074B549A5FF6F042CBF0CA"><enum>(iii)</enum><header>Payment standard</header><text>The payment standard for a voucher provided under this paragraph may not exceed 125 percent of the fair market rental in the jurisdiction in which the voucher is administered.</text></clause><clause id="id4304FA744E4F4320BBA6302C54ABAA06"><enum>(iv)</enum><header>Supplemental voucher payment</header><subclause id="id099185510A3042A4AB9FB1EB8075B94B"><enum>(I)</enum><header>In general</header><text>An eligible public housing agency may supplement the amount of a voucher provided under this paragraph in any case in which—</text><item id="idFD3934D4BB5F454C8FF453E3A9778E6E"><enum>(aa)</enum><text>the amount of the voucher is insufficient to cover the cost of a dwelling unit within the jurisdiction of the eligible public housing agency and that insufficiency may result in a voucher recipient losing housing and becoming homeless or doubled up; or </text></item><item id="idCA448D3FB624423681D3B84F1D3CC472"><enum>(bb)</enum><text>the eligible public housing agency submits to the Secretary a waiver request for recalculation of the small area fair market rent applicable to the dwelling unit, which the Secretary shall approve or deny within 45 days of submission of the request.</text></item></subclause><subclause id="idB21CEB0BDEF94719AA2733A4F1359F5F"><enum>(II)</enum><header>Payment upon denial</header><text>An eligible public housing agency may supplement the amount of a voucher under subclause (I) even if the Secretary denies the request submitted under subclause (I)(aa), provided that the supplementation of the voucher amount is necessary to maintain housing for the voucher recipient.</text></subclause></clause><clause id="id2302CFC1C61746E399BE501F8C20499B"><enum>(v)</enum><header>Conditions on assistance</header><text>Notwithstanding any other provision of law, the Secretary—</text><subclause id="id778A0B581DD3416CB6F0DFE45F9E1F34"><enum>(I)</enum><text>may not condition receipt of a voucher under this paragraph on—</text><item id="idAAFDE2D20AC649A7B276551E2FE8574B"><enum>(aa)</enum><text>participation in any service or program; or</text></item><item id="id2D70C31E80F64D52A3F3B296C42606B3"><enum>(bb)</enum><text>the sobriety or lack thereof of an eligible recipient;</text></item></subclause><subclause id="id84AC119B83544200AAC4E32363983BB4"><enum>(II)</enum><text>except as provided in subclause (III), may not prohibit receipt of a voucher under this paragraph by an otherwise eligible recipient due to any criminal conviction or history of interaction with the criminal justice system; and</text></subclause><subclause id="id1967C2CA2E9C425BA1FCF267703EEC55"><enum>(III)</enum><text>shall prohibit receipt of a voucher under this paragraph by individuals subject to a lifetime registration requirement under any State sex offender registration program. </text></subclause></clause><clause id="idF2F763BE7CBA410E9DF0E07A11700BEE"><enum>(vi)</enum><header>Verification of statement made by eligible public housing agencies</header><subclause id="id616431E8A479452592C44E73E6FD9D3E"><enum>(I)</enum><header>In general</header><text>Not later than 30 days after the date on which an eligible public housing agency submits the statement required under subparagraph (A)(iv)(III), the Secretary shall verify the statement.</text></subclause><subclause id="id1D3A594E441449BCB3B148C1B674C935"><enum>(II)</enum><header>Unsatisfactory statement</header><text>If, upon verification of a statement under subclause (I), the Secretary determines that the statement is unsatisfactory, the Secretary shall inform the eligible public housing agency of that determination and the manner in which the eligible public housing agency may re-submit the statement.</text></subclause></clause><clause id="id67ede6a24132429482e231e2d27fc4a9"><enum>(vii)</enum><header>Identification of eligible recipients</header><text>A public housing agency shall partner with continuums of care, public child welfare agencies, street outreach providers, health care providers, and other similar organizations in the State in which the public housing agency operates to identify eligible recipients.</text></clause><clause id="id6A80165F79E146D6AA8B4F8EDAECF101"><enum>(viii)</enum><header>Requirements for eligible public housing agencies</header><subclause id="id361D9EADEE064164A77CC45AD99766EF"><enum>(I)</enum><header>In general</header><text>Each eligible public housing agency providing assistance under this paragraph shall—</text><item id="idE951AA0419B64D2CA820CC009DEAC000"><enum>(aa)</enum><text>on an annual basis and in conjunction with income reviews for purposes of determining income eligibility for assistance under this paragraph, verify the compliance of the eligible public housing agency with the eligibility requirements under this paragraph;</text></item><item id="idB16927B217B54824B3EFF3AEA6BEECDA"><enum>(bb)</enum><text>to the greatest extent possible—</text><subitem id="id2FFFDE77F9634450A40A0277ED897599"><enum>(AA)</enum><text>work with continuums of care to ensure continuity of data collection under this paragraph; and</text></subitem><subitem id="id18FA129482244951BE1F5BC7D948F76C"><enum>(BB)</enum><text>utilize the HMIS to collect and main the information required to be collected under this paragraph.</text></subitem></item></subclause><subclause id="id9D4282FCB9C24218A11E5A9827FB2BF9"><enum>(II)</enum><header>Priority</header><text>In providing vouchers under this paragraph, an eligible public housing agency—</text><item id="idC5ADFEA13C66447DA3E7521F68211FC2"><enum>(aa)</enum><text>shall prioritize the first vouchers made available under this section for eligible recipients who are—</text><subitem id="id3E4023A342CE48968695DC8CA87217F5"><enum>(AA)</enum><text>unaccompanied homeless youth;</text></subitem><subitem id="id78BCD128E9DC41BE9E0ED64DDBCA1C74"><enum>(BB)</enum><text>homeless youth with minor children; or</text></subitem><subitem id="id3DD0E3DCDBCF4F7AACEC72C51E6717D4"><enum>(CC)</enum><text>families with minor children experiencing homelessness; </text></subitem></item><item id="id9BFE350604934F03B777BD1E8EFD5A45"><enum>(bb)</enum><text>to the extent possible considering when the Secretary disburses funds under this paragraph, shall provide vouchers to the eligible recipients described in item (aa) not later than 1 year after the end of the capacity-building period; and</text></item><item id="idC48215A25F7240389D50377A88883F66"><enum>(cc)</enum><text>may not issue vouchers to eligible recipients not described in item (aa) until the eligible public housing agency has issued vouchers to all eligible recipients described in that item.</text></item></subclause></clause><clause id="id3C8B97E483CB442F9876801E01993F59"><enum>(ix)</enum><header>Use of voucher upon exit</header><text>An eligible public housing agency that issued a voucher to an eligible recipient that is no longer in use by the eligible recipient may provide the voucher to any other tenant eligible for tenant-based assistance under this subsection.</text></clause></subparagraph><subparagraph id="id91BAE170C6C140F7946F3BC00007B2C8"><enum>(C)</enum><header>Data collection</header><clause id="id4ED1A624E8CC4107AF80FC2B4F662B37"><enum>(i)</enum><header>In general</header><text>The Secretary shall submit to Congress an annual report on assistance providing under this paragraph, which shall include—</text><subclause id="id19EC1D9EA6C247A3B12C5C85AC6D4E42"><enum>(I)</enum><text>an assessment of the progress of States toward housing—</text><item id="id6EBA84EFCD7B479A8520A1260A89AD22"><enum>(aa)</enum><text>eligible recipients in the State; and</text></item><item id="id1831422B8DFA493FAC5795256D7C83EB"><enum>(bb)</enum><text>the total population of people experiencing homelessness in the State; and</text></item></subclause><subclause id="id0AC87E33A7404152BEDA6D52588B8AA8"><enum>(II)</enum><text>the information provided under clause (ii).</text></subclause></clause><clause id="idCFA071C383AA4B1E8E771E9EE575B2F8"><enum>(ii)</enum><header>Information from public housing agencies</header><text>Each eligible public housing agency administering assistance under this paragraph shall submit to the Secretary and to the State in which the public housing agency is located an annual report for each fiscal year that includes—</text><subclause id="id32836B64E2E340F38EBC563E3C5561FD"><enum>(I)</enum><text>the number of voucher recipients, including aggregated demographic information on the age, sex, gender identity, sexual orientation, race, ethnicity, and disability status of each such recipient in a manner that does not reveal the personally identifiable information of each such recipient;</text></subclause><subclause id="id264E5CC75F6C44E98CFCF5EEE2C0A45D"><enum>(II)</enum><text>the number of eligible recipients who applied during the fiscal year for assistance under this paragraph, but were not provided assistance; </text></subclause><subclause id="idDD6FEF876D4C4497945E0EA3AB8AC6EF"><enum>(III)</enum><text>a brief identification in each instance described in subclause (II) of the reason why the eligible public housing agency was unable to provide the assistance; and</text></subclause><subclause id="id5B07E23EA8884FF08ADFCD6A29AC4A64"><enum>(IV)</enum><text>a description of how the eligible public housing agency communicated or collaborated with public child welfare agencies and continuums of care to collect the data described in subclauses (I) and (II).</text></subclause></clause></subparagraph><subparagraph commented="no" id="id07F04C29CFD540759B7D9E95F8F8866E"><enum>(D)</enum><header>Supportive services</header><clause commented="no" id="idCD24AC2FBD1F432C8BE870134C71876D"><enum>(i)</enum><header>Administrative fee</header><subclause commented="no" id="id13481FFF448B47A18DCC9E79F17A8BD5"><enum>(I)</enum><header>In general</header><text>The Secretary shall establish a fee under subsection (q) for the costs incurred by public housing agencies in administering vouchers under this paragraph.</text></subclause><subclause commented="no" id="id72876CB6BAE14007B66D897175532A29"><enum>(II)</enum><header>Costs</header><text>In establishing the fee described in subclause (I), the Secretary shall include the costs to public housing agencies of employing full-time or full-time-equivalent service coordinators.</text></subclause><subclause commented="no" id="id5F4147322F7C44DABD169038970F3EFC"><enum>(III)</enum><header>Authorization of appropriations</header><text>There is authorized to be appropriated $300,000,000 for each of fiscal years 2022 through 2027 for the fee described in subclause (I).</text></subclause></clause><clause id="id85a49e0bf2e94bd7b88feffeed674d00"><enum>(ii)</enum><header>Hiring of service coordinators</header><subclause id="id4DAB00FD3D544843AA988DA786845404"><enum>(I)</enum><header>In general</header><text>An eligible public housing agency shall hire the appropriate number of service coordinators to administer supportive services under this paragraph in partnership with the public child welfare agency or continuum of care in a jurisdiction.</text></subclause><subclause id="idDC80DAB07C0B41F19D5E3D51CC8F2F17"><enum>(II)</enum><header>Insufficient funds</header><text>If an eligible public housing agency is unable to hire an appropriate number of service coordinators under subclause (I) using the fee described in clause (i)(I)—</text><item id="id1CD26DFD373A43288CACAF4CD6EDDC4F"><enum>(aa)</enum><text>the public housing agency may request an increased administrative fee from the Secretary; and</text></item><item id="id2D39B16A30B34793ACE40BEC59CCB542"><enum>(bb)</enum><text>the Secretary shall approve or deny a request received under item (aa) within 45 days.</text></item></subclause><subclause id="id905C2DB86BB9499EBDB9074710F3F4AA"><enum>(III)</enum><header>Report to Congress</header><text>Beginning in the first full fiscal year after the date of enactment of this paragraph, the Secretary shall submit an annual report to Congress on requests for increased administrative fees received from public housing agencies under subclause (II).</text></subclause><subclause id="idFD845159A5194A5C999ED12FD4D1C203"><enum>(IV)</enum><header>Appropriate number defined</header><text>For purposes of this clause, the term <term>appropriate number</term>, with respect to service coordinators, means enough service coordinators so that each household provided a voucher by a public housing agency under this paragraph is able to access a service coordinator for not less than 30 minutes each week.</text></subclause></clause><clause id="id0F675BBAE8ED453DAC106301C97CCD63"><enum>(iii)</enum><header>Provision of services</header><text>Upon intake of an eligible recipient, a public housing agency or a public child welfare agency or continuum of care with which the public housing agency has partnered shall—</text><subclause id="idEEE9149AADDE4CC89AF9362E64407C29"><enum>(I)</enum><text>assign the voucher recipient a case manager or service coordinator; and</text></subclause><subclause id="idD98D6D404A274C2C95EF00306DA77EC8"><enum>(II)</enum><text>provide or secure the provision of supportive services to contribute to the housing stability of the voucher recipient, including—</text><item id="idC21EC1D7362C43339C9F9C0662D31374"><enum>(aa)</enum><text>any supportive service, as defined in section 401 of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11360">42 U.S.C. 11360</external-xref>);</text></item><item id="id9c07d093891a48dd84052c24d7a43948"><enum>(bb)</enum><text>referrals to health care providers, including mental health care providers, dental health care providers, and vision health care providers; </text></item><item id="idD326867F1349452BA28D854AB0A23803"><enum>(cc)</enum><text>referrals to substance use disorder treatment, including recovery, treatment, 12-step programs, relapse prevention, or medication-assisted treatment;</text></item><item id="idA43475E2B0954D239BD7D964172CCBA8"><enum>(dd)</enum><text>assistance relating to enrollment in the Medicare or Medicaid programs under titles XVIII and XIX of the Social Security Act (<external-xref legal-doc="usc" parsable-cite="usc/42/1395">42 U.S.C. 1395 et seq.</external-xref>, 1396 et seq.), respectively, and referrals to other services, including— </text><subitem id="id8042390ad99a438ba47f0ed7db783098"><enum>(AA)</enum><text>the supplemental nutrition assistance program under the Food and Nutrition Act of 2008 (<external-xref legal-doc="usc" parsable-cite="usc/7/2011">7 U.S.C. 2011 et seq.</external-xref>) (commonly known as the <quote>SNAP Program</quote>); and</text></subitem><subitem id="id49b42bb5c3e6499aac7dca822e7607d3"><enum>(BB)</enum><text>the program of block grants for States for temporary assistance for needy families established under part A of title IV of the Social Security Act (<external-xref legal-doc="usc" parsable-cite="usc/42/601">42 U.S.C. 601 et seq.</external-xref>) (commonly known as the <quote>TANF Program</quote>);</text></subitem></item><item id="idAE92BB88F50C40A1AF997B9E0262D904"><enum>(ee)</enum><text>advising on eligibility for the family self-sufficiency program established, credit counseling, and housing counseling programs;</text></item><item id="id9C7C7D1BAC244140A3444428FE5D8CAF"><enum>(ff)</enum><text>referrals to education services, including general educational development (commonly known as <quote>GED</quote>) preparation and testing, enrollment in postsecondary education programs, and credit recovery; and</text></item><item id="idC0590DEEE3514761853EA911FE630F48"><enum>(gg)</enum><text>facilitation of transportation assistance to any of the supportive services described in this subparagraph.</text></item></subclause></clause><clause id="id58051941684A431DA13AF947BB2CAD30"><enum>(iv)</enum><header>Eligibility of private nonprofit organizations and faith-based organizations</header><subclause id="id61B6EC2C5365425A93801F19355E304B"><enum>(I)</enum><header>Definitions</header><text>In this clause, the terms <term>eligible entity</term> and <term>private nonprofit organization</term> have the meanings given those terms in section 401 of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11360">42 U.S.C. 11360</external-xref>).</text></subclause><subclause id="idC9074EB61D144195AC5AA425EA5F4AF7"><enum>(II)</enum><header>Eligibility</header><text>Notwithstanding any other provision of law—</text><item id="id0BFF8A52E6EE413CB0E38CA6E7A5C8BB"><enum>(aa)</enum><text>the Secretary shall provide that private nonprofit organizations that are eligible entities, including faith-based private nonprofit organizations that are eligible entities, shall be eligible to—</text><subitem id="id07CDC5CB4D9E412DBA16194A7C0C865D"><enum>(AA)</enum><text>provide services described in clause (iii); and</text></subitem><subitem id="id6A39D36EC4704B708CEEEFA0EA4A0A4D"><enum>(BB)</enum><text>receive amounts made available to carry out clause (iii); and</text></subitem></item><item id="id426F44331E8545CA9B1808C2C76C7F6C"><enum>(bb)</enum><text>in determining eligibility for amounts made available to carry out clause (iii), the status of an entity as faith-based or the possibility that an entity may be faith-based may not be a basis for any discrimination against such entity in any manner or for any purpose.</text></item></subclause></clause><clause id="id098DE099472F40089E4A8D6728B97FD7"><enum>(v)</enum><header>Access</header><text>Services provided under this subparagraph shall be available to voucher recipients with low-to-no barrier access.</text></clause><clause id="id8B0369B172584A11B510D104D1123F96"><enum>(vi)</enum><header>Evaluation</header><text>An eligible public housing agency, public child welfare agency, or continuum of care described in clause (iii) shall evaluate each voucher recipient for individual case management needs under this subparagraph.</text></clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id68036028071A4F6E9DC95DC0D5DB62CB"><enum>(E)</enum><header>Capacity building</header><clause commented="no" display-inline="no-display-inline" id="id98704CF675D546A3A1B15B556BA5073B"><enum>(i)</enum><header>Authorization of appropriations</header><text>There is authorized to be appropriated to the Secretary $500,000,000 for each of fiscal years 2022 and 2023 to provide funding for capacity building to eligible public housing agencies.</text></clause><clause commented="no" display-inline="no-display-inline" id="id01E4694A0D3B4D1C873E80771FAB3B1F"><enum>(ii)</enum><header>Funding formula</header><text>Not later than 45 days after the date of enactment of this paragraph, the Secretary shall establish a formula for allocating the funding authorized under clause (i) that takes into account—</text><subclause id="id21bb8c2c20ad4540a28e8ddbdd3fc225"><enum>(I)</enum><text>the ratio of individuals in the State in which the eligible public housing agency operates who are homeless to the overall population of the State;</text></subclause><subclause id="idB528BE61616F49B48F24AC0DE495F610"><enum>(II)</enum><text>the proportion of families in each State with children experiencing unsheltered homelessness, as reported in the State's most recent point-in-time count, to the total number of unsheltered homeless families in the State as reported in the same point-in-time count; and</text></subclause><subclause id="id78659aa3f2304c3fb5460944b8146286"><enum>(III)</enum><text>the rate of unsheltered homelessness in each State compared to each other State, as reported in each State's most recent point-in-time count.</text></subclause></clause><clause commented="no" display-inline="no-display-inline" id="idCC1B4BE1F1C642389EF0E73DE720146E"><enum>(iii)</enum><header>Disbursement</header><text>Not later than 30 days after an eligible public housing agency submits an acceptable statement under subparagraph (A)(iv)(III), the Secretary shall disburse amounts authorized under clause (i) of this subparagraph in accordance with the formula established under clause (ii) of this subparagraph.</text></clause><clause commented="no" display-inline="no-display-inline" id="id49897B3DFDA74834BA2E95F3F423BBA9"><enum>(iv)</enum><header>Minimum and maximum allocation</header><text>The Secretary shall ensure that—</text><subclause commented="no" display-inline="no-display-inline" id="idD058DF820CB64BB3A2309E09C33C7604"><enum>(I)</enum><text>each eligible public housing agency does not receive more than 10 percent of the amount authorized under clause (i); and</text></subclause><subclause commented="no" display-inline="no-display-inline" id="id54BBB058F6BD440498A8186C13216A86"><enum>(II)</enum><text>each State in which an eligible public housing agency receives funds under clause (i) does not receive more than 25 percent of the total amount authorized under that clause.</text></subclause></clause><clause commented="no" display-inline="no-display-inline" id="idC92CA1BBFC934EAB9F90C0A1FABA11D5"><enum>(v)</enum><header>Eligible activities</header><text>A recipient of funds authorized under clause (i) may only use the funds for—</text><subclause commented="no" display-inline="no-display-inline" id="id1FDECD87F54749E09046CDF4FB6C59DF"><enum>(I)</enum><text>hiring and personnel needs, such as case managers and housing placement advisory;</text></subclause><subclause commented="no" display-inline="no-display-inline" id="idF55C6BC9B8EB41B9BDEED8E7E084A47E"><enum>(II)</enum><text>physical infrastructure—</text><item commented="no" display-inline="no-display-inline" id="idBEF2FADF54D14EDC84DECABDDE1552EC"><enum>(aa)</enum><text>including increased office space or facilities for the provision of supportive services; and</text></item><item commented="no" display-inline="no-display-inline" id="id4B8712A1957645DE9A0DDFD637A45D0E"><enum>(bb)</enum><text>not including residential housing;</text></item></subclause><subclause commented="no" display-inline="no-display-inline" id="idAD58365FCF514813B5B3164D72DE5CEB"><enum>(III)</enum><text>technological infrastructure needs, including upgrades to the HMIS; and </text></subclause><subclause id="id3cc30ce40cc04273a283d6fc4fe06e44"><enum>(IV)</enum><text>any other capacity-related investments that are necessary for the public housing agency to—</text><item id="id4865E4A028094F2C964465D598C5DC38"><enum>(aa)</enum><text>develop, acquire, or rehabilitate housing that is affordable to extremely low-income families, to be made available to people experiencing homelessness; or</text></item><item id="idF2EEDB5DBF904F84A5538F2B6D0A5E57"><enum>(bb)</enum><text>support the successful administration of the vouchers under this paragraph.</text></item></subclause></clause><clause commented="no" display-inline="no-display-inline" id="idDF6100F52E3E4350AF6DCA3DCF8BAB9F"><enum>(vi)</enum><header>Requirement for expenditure of funds</header><text>Each eligible public housing agency that receives funds under clause (i) shall expend not less than 60 percent of the funding during the 2-year period following receipt of the funding.</text></clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="idF4DA32BEE5DB42A690D6E203360755A8"><enum>(F)</enum><header>State accountability</header><clause commented="no" display-inline="no-display-inline" id="id0A761C0188B748A188ABA65BE0EF7A2E"><enum>(i)</enum><header>In general</header><text>Each eligible public housing agency providing assistance under this paragraph shall—</text><subclause commented="no" display-inline="no-display-inline" id="id6D2668CD6F384548957971813F3B6947"><enum>(I)</enum><text>on a monthly basis, report caseload and voucher administration statistics to the State in which the agency operates; and</text></subclause><subclause commented="no" display-inline="no-display-inline" id="id34BE65C052BC412C8645E6D5C82A2E9B"><enum>(II)</enum><text>twice annually, submit to the State in which the agency operates a report on the progress toward issuing a voucher under this paragraph to all eligible recipients, based on—</text><item id="id705df9bfd1a141ba80bca4f082e1b0d4"><enum>(aa)</enum><text>the percentage reduction in the number of families with children and youth that are experiencing homelessness in the area in which the agency care operates, as determined by comparing the most recent point-in-time count with the point-in-time count conducted 1 year prior; and</text></item><item commented="no" display-inline="no-display-inline" id="id25BF990D41BD448CAC665FCD04B77C5C"><enum>(bb)</enum><text>the percentage reduction in the number of children experiencing homelessness in the State, as documented under the requirements of the program authorized under subtitle B of title VII of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11431">42 U.S.C. 11431 et seq.</external-xref>).</text></item></subclause></clause><clause commented="no" display-inline="no-display-inline" id="idC81A512C51E54708971A829CD6E8FE6A"><enum>(ii)</enum><header>Benchmarks</header><text>Each year, each State shall meet the benchmarks described in this clause, based equally on the percentage reduction in reported population of children and families experiencing homelessness in the following year’s point-in-time count and the percentage reduction in population of students experiencing homelessness:</text><subclause commented="no" display-inline="no-display-inline" id="idF7F01087B97F44EF965D5B5F27B698FC"><enum>(I)</enum><header>Annual report</header><text>Each State shall submit an annual report to the Secretary that contains—</text><item commented="no" display-inline="no-display-inline" id="id68537A46EA1C41729E18FEB350E92700"><enum>(aa)</enum><text>data collected from schools pursuant to the program authorized under subtitle B of title VII of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11431">42 U.S.C. 11431 et seq.</external-xref>), including the number of students—</text><subitem commented="no" display-inline="no-display-inline" id="id69103F3506B5453AA66DF316128A4E43"><enum>(AA)</enum><text>experiencing unsheltered homelessness;</text></subitem><subitem commented="no" display-inline="no-display-inline" id="idEA7239851FBC41AAB777CA63004B677D"><enum>(BB)</enum><text>living in shelters;</text></subitem><subitem commented="no" display-inline="no-display-inline" id="idF64EC378546B4B27ABAE77F47693C9E3"><enum>(CC)</enum><text>living in motels, hotels, or campgrounds;</text></subitem><subitem commented="no" display-inline="no-display-inline" id="id0A763628312C4BC79E49BBDDFD5D4DA6"><enum>(DD)</enum><text>living in a car or other motor vehicle; or</text></subitem><subitem commented="no" display-inline="no-display-inline" id="id0EEC833428794CD7870B456A8B9F88BA"><enum>(EE)</enum><text>sharing the housing of other persons due to loss of housing, economic hardship, or similar reasoning; and</text></subitem></item><item commented="no" id="ida4a026936d31430080bcfac9d3202939"><enum>(bb)</enum><text>the information received from each public housing agency in the State under clause (i)(II).</text></item></subclause><subclause commented="no" display-inline="no-display-inline" id="idAEBF3685CAD040ADAB5D55C49567C383"><enum>(II)</enum><header>Issuance of vouchers for smaller States</header><text>Each State with a rate of homelessness that is not higher than 10 people per 10,000 shall—</text><item commented="no" display-inline="no-display-inline" id="id4B1BC4388CD947DB88906C721C23D38D"><enum>(aa)</enum><text>not later than 2 years after the end of the capacity-building period—</text><subitem commented="no" display-inline="no-display-inline" id="idAF6DE86508B24EE7BFF34294D1A9ED2F"><enum>(AA)</enum><text>issue vouchers under this paragraph to not less than 50 percent of the population of people experiencing homelessness in the State, using data from the most recent point-in-time count; and</text></subitem><subitem commented="no" display-inline="no-display-inline" id="idF1E1B92427624A5C82AF30967203F7BF"><enum>(BB)</enum><text>to the greatest extent possible, prioritize the issuance of those vouchers to eligible youth and families;</text></subitem></item><item commented="no" display-inline="no-display-inline" id="id2633B57DDDEB422F81BE1F75F281CCF7"><enum>(bb)</enum><text>not later than 3 years after the end of the capacity-building period—</text><subitem commented="no" display-inline="no-display-inline" id="idE38649654DFD435C874F9E878107EE35"><enum>(AA)</enum><text>issue vouchers under this paragraph to not less than 70 percent of the population of people experiencing homelessness in the State, using data from the most recent point-in-time count; and</text></subitem><subitem commented="no" display-inline="no-display-inline" id="idD0C60C4BADC44404BA9153F7BC0F4C24"><enum>(BB)</enum><text>to the greatest extent possible, prioritize the issuance of those vouchers to eligible youth and families; and</text></subitem></item><item commented="no" display-inline="no-display-inline" id="idB2156CA3FA764472867BA75C21C2F5A4"><enum>(cc)</enum><text>not later than 4 years after the end of the capacity-building period, issue vouchers under this paragraph to all people experiencing homelessness in the State.</text></item></subclause><subclause commented="no" display-inline="no-display-inline" id="id12494422CB114D87BA46EDED220A706E"><enum>(III)</enum><header>Issuance of vouchers for larger States</header><text>Each State with a rate of homelessness that is higher than 10 people per 10,000 shall—</text><item commented="no" display-inline="no-display-inline" id="id7B3C605F0E674FAE873473BD8BDE3D53"><enum>(aa)</enum><text>not later than 2 years after the end of the capacity-building period—</text><subitem commented="no" display-inline="no-display-inline" id="id3CA4E05131B84122BC70420029DC7A3E"><enum>(AA)</enum><text>issue vouchers under this paragraph to not less than 40 percent of the population of people experiencing homelessness in the State, using data from the most recent point-in-time count; and</text></subitem><subitem commented="no" display-inline="no-display-inline" id="id0AFB3D097E8A4FC48E848F37B469B9F4"><enum>(BB)</enum><text>to the greatest extent possible, prioritize the issuance of those vouchers to eligible youth and families; </text></subitem></item><item commented="no" display-inline="no-display-inline" id="idFE15CD4BC2694F3BA3E924B5F0012D14"><enum>(bb)</enum><text>not later than 3 years after the end of the capacity-building period—</text><subitem commented="no" display-inline="no-display-inline" id="idAB5529C4E1A845E0BFF4129222121940"><enum>(AA)</enum><text>issue vouchers under this paragraph to not less than 60 percent of the population of people experiencing homelessness in the State, using data from the most recent point-in-time count; and</text></subitem><subitem commented="no" display-inline="no-display-inline" id="idB2F63769F2F640B881AB54D200227508"><enum>(BB)</enum><text>to the greatest extent possible, prioritize the issuance of those vouchers to eligible youth and families; and</text></subitem></item><item commented="no" display-inline="no-display-inline" id="id894594B3AEA149A3ADE9F3D3FC26698E"><enum>(cc)</enum><text>not later than 4 years after the end of the capacity-building period, issue vouchers under this paragraph to all people experiencing homelessness in the State.</text></item></subclause></clause><clause commented="no" display-inline="no-display-inline" id="id251A82EAD16D473D828CBA1227160EE8"><enum>(iii)</enum><header>Penalties</header><subclause commented="no" display-inline="no-display-inline" id="id6E66A2055EC941748517EB1F39DFCA05"><enum>(I)</enum><header>Warning</header><text>Except as provided in clause (v), if a State does not meet the applicable benchmarks described in clause (ii), the Secretary shall publicly warn the State of the failure of the State to meet the benchmark and remind the State of the applicable penalties.</text></subclause><subclause commented="no" display-inline="no-display-inline" id="id665F3799DB884846B579F250A38EA313"><enum>(II)</enum><header>Reduction in Federal highway funds</header><text>If a State does not meet the applicable benchmarks described in clause (ii)—</text><item commented="no" display-inline="no-display-inline" id="idD150CB0F24DF4F0F9736FF4F50621B74"><enum>(aa)</enum><text>by the date that is 180 days after the warning by the Secretary under subclause (I) of this clause, the Federal share payable for Federal-aid highway projects under section 120 of title 23, United States Code, shall be reduced by 5 percent; or</text></item><item commented="no" display-inline="no-display-inline" id="id15F16B0D343B487788EC0BAD40C6716A"><enum>(bb)</enum><text>by the date that is 180 days after a reduction made under item (aa) of this subclause, the Federal share payable for Federal-aid highway projects under section 120 of title 23, United States Code, shall be further reduced by 5 percent.</text></item></subclause></clause><clause id="idca80c958f5a447bba6d7764127823a0c"><enum>(iv)</enum><header>Condition on compliance</header><text>Beginning in the first Notice of Funding Availability cycle beginning after the date of enactment of this paragraph, and every Notice of Funding Availability cycle thereafter, the Secretary shall condition the awarding of all funding for vouchers under this paragraph by the Secretary to a public housing authority in a State on that State’s compliance with the benchmarks described in clause (ii).</text></clause><clause commented="no" display-inline="no-display-inline" id="id57669C6393824FB38823872CAB154D55"><enum>(v)</enum><header>Unemployment rate</header><text>If the quarterly unemployment rate of the population of a State is not less than 6 percent—</text><subclause commented="no" display-inline="no-display-inline" id="id7D73192D821C4B7E82CDD76F032E4D95"><enum>(I)</enum><text>the State shall not be penalized under clause (iii) for failure to meet the benchmarks described in clause (ii); and</text></subclause><subclause commented="no" display-inline="no-display-inline" id="idA5BAD02DC8E04282ADDBE7534ABC8745"><enum>(II)</enum><text>the State shall be required to meet the benchmarks described in clause (ii) not later than 180 days after the date on which the quarterly unemployment rate descends beneath 6 percent. </text></subclause></clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id6402EB0DEA81425F92BA6BB2350B0F41"><enum>(G)</enum><header>Administrative needs of HUD</header><clause commented="no" display-inline="no-display-inline" id="idCD2A646515754E9D8E3690518179F222"><enum>(i)</enum><header>Authorization of appropriations</header><text>There is authorized to be appropriated $15,000,000 for each of fiscal years 2022 through 2026 to the Secretary for the administrative needs of the Department of Housing and Urban Development and regional offices of the Department in carrying out the voucher program under this paragraph.</text></clause><clause id="id3dbba983a2bb4e2fa3a8fe26cc06e7cc"><enum>(ii)</enum><header>Prohibition</header><text>None of the funds made available under this subparagraph may be used to provide raises or bonuses to any employee of the Department of Housing and Urban Development in an amount that is more than 10 percent of the annual gross salary of the employee.</text></clause></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></section><section id="id1E53FBBCFFC54D16BC2EE7414E83AE4D"><enum>112.</enum><header>Land acquisition and construction</header><subsection id="id79373E15CF3441F8A41F1DCA84B6E07C"><enum>(a)</enum><header>Definitions</header><text>In this section—</text><paragraph id="id3A2AF894AFD448F68743E418AF6E879F"><enum>(1)</enum><text>the term <term>at risk of homelessness</term> has the meaning given the term in section 401(1) of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11360">42 U.S.C. 11360</external-xref>), except that <quote>50 percent</quote> shall be substituted for <quote>30 percent</quote> in subparagraph (A) of that section;</text></paragraph><paragraph id="id1190B179B3F54340B715C1D5643DB1C1"><enum>(2)</enum><text>the terms <term>extremely low-income</term> and <term>very low-income</term> have the meanings given those terms in section 1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (<external-xref legal-doc="usc" parsable-cite="usc/12/4502">12 U.S.C. 4502</external-xref>);</text></paragraph><paragraph id="id6913FDF689094347995BDBB3886C0959"><enum>(3)</enum><text>the term <term>homeless</term> means an individual or family who is—</text><subparagraph id="id9EB4AD6D75C1473E96F282B7B4E3A8C4"><enum>(A)</enum><text>living in a place not meant for human habitation or in an emergency shelter;</text></subparagraph><subparagraph id="id4D902809ABCD4B3BBCC255EFABC8BD58"><enum>(B)</enum><text>living in transitional housing for homeless persons and was homeless before entering transitional housing or an emergency shelter;</text></subparagraph><subparagraph id="id2C50B4879D6C46BEBF835BBF5485909E"><enum>(C)</enum><text>fleeing domestic violence; or</text></subparagraph><subparagraph id="id638CE819A22745389BA52E4CFBF6B0CC"><enum>(D)</enum><text>at risk of homelessness; and</text></subparagraph></paragraph><paragraph id="id9793CD3B187D43C5832E04E838199926"><enum>(4)</enum><text>the term <term>Secretary</term> means the Secretary of Housing and Urban Development.</text></paragraph></subsection><subsection id="id6BBFF612AFFE4EDE8915F25957180FAA"><enum>(b)</enum><header>Authorizations of appropriations</header><paragraph id="id5900E16C108F41E880724D8AB9EF0289"><enum>(1)</enum><header>In general</header><text>There is authorized to be appropriated to the Housing Trust Fund established under section 1338 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (<external-xref legal-doc="usc" parsable-cite="usc/12/4568">12 U.S.C. 4568</external-xref>) $10,000,000,000 for each of fiscal years 2022 through 2032 for allocation to States in accordance with subsection (c) of such section 1338, subject to subsections (c) through (f) of this section.</text></paragraph><paragraph commented="no" display-inline="no-display-inline" id="idBCA81E8907D54266AFC5F82A2A293866"><enum>(2)</enum><header>Administrative needs of States</header><subparagraph commented="no" display-inline="no-display-inline" id="id96F3DB4EA7324D54B41CCB8DA510B2DF"><enum>(A)</enum><header>Authorization of appropriations</header><text>There is authorized to be appropriated to the Secretary $65,000,000 for each of fiscal years 2022 through 2027 for the administrative needs of States under this section, in accordance with subparagraph (C).</text></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id3FEE90E6E7DA49C08B601F08E3C97810"><enum>(B)</enum><header>Allocation</header><text>Of amounts authorized to be appropriated under subparagraph (A) for each fiscal year—</text><clause commented="no" display-inline="no-display-inline" id="id3AF156515E294324B7DDDC4D3DBBA86D"><enum>(i)</enum><text>$15,000,000 shall be allocated to the Commonwealth of the Northern Mariana Islands, Guam, American Samoa, and the Virgin Islands; and</text></clause><clause commented="no" display-inline="no-display-inline" id="id6A053C6256C84F61A41AC784D0C44AEB"><enum>(ii)</enum><text>the remainder shall be allocated to States pursuant to the formula established under paragraph (21)(E)(ii) of section 8(o) of the United States Housing Act of 1937 (<external-xref legal-doc="usc" parsable-cite="usc/42/1437f">42 U.S.C. 1437f(o)</external-xref>), as added by section 3 of this Act.</text></clause></subparagraph><subparagraph commented="no" id="id61dbd6f798c44443b513bff6d52a0ccf"><enum>(C)</enum><header>Eligible activities</header><text>A State that receives funds authorized to be appropriated under subparagraph (A) may only use the funds for capacity-related investments that are necessary for the State to successfully allocate funds made available under paragraph (1) of this subsection.</text></subparagraph><subparagraph id="id125719b8a3c54d0e8647bedef612e6e5"><enum>(D)</enum><header>Prohibition</header><text>None of the funds made available under this paragraph may be used to provide raises or bonuses to any official of the executive branch of a State.</text></subparagraph></paragraph></subsection><subsection id="id77597dd048b04f3283e32f969590dcdc"><enum>(c)</enum><header>Revision of funding formula</header><paragraph id="id4696B00DB18546F487AB3E868604242B"><enum>(1)</enum><header>In general</header><text>Not later than 1 year after the date of enactment of this Act, the Secretary shall report to Congress proposed changes to the funding formula under section 1338(c)(3) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (<external-xref legal-doc="usc" parsable-cite="usc/12/4568">12 U.S.C. 4568(c)(3)</external-xref>) in order to ensure that the funding formula takes into account the economic status of the people of the United States, including the economic impact of the COVID–19 pandemic.</text></paragraph><paragraph id="id54DE10C983D34680B958FE23651C199F"><enum>(2)</enum><header>Contents</header><text>The revised formula proposed under paragraph (1) shall address the following concerns:</text><subparagraph id="id5f2ec201a9904432b178fa6c04818fb6"><enum>(A)</enum><text>The COVID–19 pandemic and its impacts on the economic security and housing stability of very low-income and extremely low-income people of the United States.</text></subparagraph><subparagraph id="id4ccaeadffe8e4762a3db29620c8e76e6"><enum>(B)</enum><text>The impacts of differing vacancy rates across various housing markets in the United States.</text></subparagraph><subparagraph id="id006737e75965415ebaadff9662db10ae"><enum>(C)</enum><text>The rate of unsheltered homelessness in various housing markets across the United States.</text></subparagraph><subparagraph id="id8296a721d8394076b233d7127bca87ca"><enum>(D)</enum><text>The impact of differing rates of poverty and extreme poverty across various States.</text></subparagraph><subparagraph id="ide2e9a6ffd21f4fe29daa487f3070c4f6"><enum>(E)</enum><text>The gap between demand for and supply of rental units that are affordable and available to very low-income and extremely low-income renters in a State.</text></subparagraph></paragraph></subsection><subsection id="id4A6C8CAB96504FDC9B69E6E769822BBF"><enum>(d)</enum><header>Eligible households</header><text>Housing that is assisted using amounts made available under subsection (b) may only be used for the benefit of very low-income or extremely low-income households.</text></subsection><subsection id="idE789A6F1A692480A804DD1727B940629"><enum>(e)</enum><header>Eligible activities</header><text>A recipient of funds authorized under subsection (b)—</text><paragraph id="id28A448FA51FC42838B285AF7496ACE8E"><enum>(1)</enum><text>may only use the funds for land acquisition and the acquisition, rehabilitation, or development of rental housing that is affordable for very low-income or extremely low-income households; and</text></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id2C1DD7D3CC0B4CFF8B1DFB8AE84B439F"><enum>(2)</enum><text>shall take all possible measures to expedite construction of housing described in paragraph (1).</text></paragraph></subsection><subsection id="id54eeb836596445a795cb411352ff246a" commented="no"><enum>(f)</enum><header>Priority for occupancy in dwelling units</header><paragraph commented="no" id="idC6ABCD7D999A4CEB9BDA8022558D137F"><enum>(1)</enum><header>First 2 fiscal years</header><text>During the first 2 fiscal years for which amounts are made available to carry out this section, the Secretary shall ensure that priority for occupancy in a dwelling unit that receives assistance under this section is given to a homeless family or homeless youth.</text></paragraph><paragraph id="idd184bdfc610b49e390d9f30f3654510d" commented="no"><enum>(2)</enum><header>Subsequent 3 fiscal years</header><text>During the third, fourth, and fifth fiscal years for which amounts are made available to carry out this section, the Secretary shall ensure that priority for occupancy in a dwelling unit that receives assistance under this section is given to a homeless family or homeless individual.</text></paragraph></subsection></section><section id="idcde39ed30e9f4854b5d8657696db537b"><enum>113.</enum><header>Modular construction pilot program</header><subsection id="id108d03feceb741a191444a9e159689a8"><enum>(a)</enum><header>Definitions</header><text>In this section:</text><paragraph id="id9526fd40c7154a258df3e3abf533f13f"><enum>(1)</enum><header>Eligible entity</header><text>The term <term>eligible entity</term> means a public housing agency, a tribally designated housing entity (as defined in section 4 of the Native American Housing Assistance and Self Determination Act of 1996 (<external-xref legal-doc="usc" parsable-cite="usc/25/4103">25 U.S.C. 4103</external-xref>)), a nonprofit entity, a company, a religious entity, or a unit of local or Tribal government. </text></paragraph><paragraph id="idd5191d0cf0c24e7095ef230a4409a0b9"><enum>(2)</enum><header>Modular construction</header><text>The term <term>modular construction</term> means the method of residential construction by which building modules are constructed off of the future site of a building, then brought together on the building site to form a larger residential building, in an effort to reduce construction costs.</text></paragraph><paragraph id="id88DC05BCC4E7466696830643A5B57C87"><enum>(3)</enum><header>Secretary</header><text>The term <term>Secretary</term> means the Secretary of Housing and Urban Development. </text></paragraph></subsection><subsection id="id936117d877f94039aea00aa18b6ad5bd"><enum>(b)</enum><header>Establishment of program</header><paragraph id="idf4f6d3a0c3e84c77931f42d9c9378cc2"><enum>(1)</enum><header>In general</header><text>The Secretary shall establish a pilot program to provide grants to eligible entities to promote the construction of affordable housing using modular construction.</text></paragraph><paragraph id="id5ef49e080be74f09a1aa480501b36af8"><enum>(2)</enum><header>Affordability requirement</header><text>To be eligible to receive a grant under paragraph (1), an eligible entity shall be required to guarantee affordability for a period of more than 20 years.</text></paragraph><paragraph id="id0F5AD783A45F4927AA73F68880DEC2B9"><enum>(3)</enum><header>Priority</header><text>In awarding grants under paragraph (1), the Secretary shall give priority to an eligible entity that fulfills not fewer than two of the following requirements:</text><subparagraph id="id1680707d106249418782d95d348ae41d"><enum>(A)</enum><text>The eligible entity—</text><clause id="id250C0ADFA1B84D1AA24FA14DBA4B0BAA"><enum>(i)</enum><text>will construct the housing in groups of more than 50 units; or</text></clause><clause id="id3BED2F7D2A1F4170B6E67E99A6D54825"><enum>(ii)</enum><text>provides confirmation from the jurisdiction with land use control over the site proposed by the eligible entity that—</text><subclause id="id3DEBA95ABD074A5D85F6058E87F44AC9"><enum>(I)</enum><text>construction will be completed within 18 months; and</text></subclause><subclause id="idCA631CEC73494CA89B98411F86021BDE"><enum>(II)</enum><text>the housing will be constructed in groups of more than 30 units.</text></subclause></clause></subparagraph><subparagraph id="id896b385c40364a389a2fd6b1403ddf65"><enum>(B)</enum><text>The eligible entity partners with a public housing agency or unit of local government that will issue rental assistance to residents of the affordable housing through vouchers or grants.</text></subparagraph><subparagraph id="id2169f8bb27194d3e949b7ddf5baf97f6"><enum>(C)</enum><text>The eligible entity will provide supportive services (as described in paragraph (21)(D)(iii)(II) of section 8(o) of the United States Housing Act of 1937 (<external-xref legal-doc="usc" parsable-cite="usc/42/1437f">42 U.S.C. 1437f(o)</external-xref>), as added by section 3 of this Act) to residents at no charge, or has secured the provision of publicly or privately administered supportive services (as so defined) to residents at no charge. </text></subparagraph></paragraph></subsection><subsection id="id84d2aaf7593d494ab1916b13edcec837"><enum>(c)</enum><header>Matching requirement</header><text>The Federal share of a project funded under this section shall be not more than 75 percent of the cost of the project. </text></subsection><subsection id="id7b1eb18fd91144f2bf9fcc89c4f4feb9"><enum>(d)</enum><header>Authorization of appropriations</header><text>There is authorized to be appropriated to the Secretary $2,000,000 for each of fiscal years 2022 through 2027 to carry out this section.</text></subsection></section><section id="idc81ab701a2cf4904b2dac336e92463c2"><enum>114.</enum><header>Supporting pro-housing development</header><subsection id="id82F8766E1B6540C1A5C73B73617591FB"><enum>(a)</enum><header>Definitions</header><text>In this section:</text><paragraph id="idA6EBEFE3497D46438B027C10A1674C94"><enum>(1)</enum><header>Duplex</header><text>The term <term>duplex</term> means a residential building divided into 2 units, each of which has a separate entrance.</text></paragraph><paragraph id="idA6FADC18B29D489F93A8281B10E78DDF"><enum>(2)</enum><header>Eligible activity</header><text>The term <term>eligible activity</term> means an activity authorized under section 105(a) of the Housing and Community Development Act of 1974 (<external-xref legal-doc="usc" parsable-cite="usc/42/5305">42 U.S.C. 5305(a)</external-xref>).</text></paragraph><paragraph id="id08A85A9F6B4F4EEFB1E242CDF274C1F4"><enum>(3)</enum><header>Eligible entity</header><text>The term <term>eligible entity</term> means a jurisdiction that adopts a zoning and community planning method described in subsection (d)(4) after the date of enactment of this Act.</text></paragraph><paragraph id="id94d5436f80d64329bba27dcb2219091c"><enum>(4)</enum><header>Floor area ratio</header><text>The term <term>floor area ratio</term> means the measurement of the floor area of a building in relation to the size of the unit of land on which the building is located.</text></paragraph><paragraph id="id724C9085C01945A4A5A3894F19DD49EF" commented="no"><enum>(5)</enum><header>Jurisdiction</header><text>The term <term>jurisdiction</term> has the meaning given the term in section 91.5 of title 24, Code of Federal Regulations, or any successor regulation.</text></paragraph><paragraph id="id10BB80BEA35644AAB283AF715F6A63EC"><enum>(6)</enum><header>Low-income</header><text>The term <term>low-income</term> has the meaning given the term in section 1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (<external-xref legal-doc="usc" parsable-cite="usc/12/4502">12 U.S.C. 4502</external-xref>).</text></paragraph><paragraph id="id4c36c885d526441c97176688b8897687"><enum>(7)</enum><header>Mixed-use housing</header><text>The term <term>mixed use housing</term> means a building with—</text><subparagraph id="idb8eec2f15a954ab5b5decf8b6af7c7c1"><enum>(A)</enum><text>retail or other business, public service, or nonprofit establishments at the ground level or a lower level; and</text></subparagraph><subparagraph id="id9a872bad6c9d4862a37d4d5aae05f020"><enum>(B)</enum><text>not less than 1 story of residential units above the establishments described in subparagraph (A).</text></subparagraph></paragraph><paragraph id="idDB164FADD052418F8B18766BA9BD2C81" commented="no" display-inline="no-display-inline"><enum>(8)</enum><header>Quadplex</header><text>The term <term>quadplex</term> means a residential building divided into 4 units, each of which has a separate entrance. </text></paragraph><paragraph id="id8DC0AD675CFF42509C51B173F41F51F7"><enum>(9)</enum><header>Secretary</header><text>The term <term>Secretary</term> means the Secretary of Housing and Urban Development.</text></paragraph><paragraph id="id15672A5F9FC94BAB9D06D3D1D371EC67"><enum>(10)</enum><header>Triplex</header><text>The term <term>triplex</term> means a residential building divided into 3 units, each of which has a separate entrance.</text></paragraph><paragraph id="id035e48141afe46fa8c4739a2dab91dd5"><enum>(11)</enum><header>Multifamily housing</header><text>The term <term>multifamily housing</term>—</text><subparagraph id="id201B0A2FCBDF411EBA113E68F5374446"><enum>(A)</enum><text>means housing accommodations that—</text><clause id="id3BEB51D131AD46CAB2B939629F2532FF"><enum>(i)</enum><text>are designed principally for residential use;</text></clause><clause id="id67E51E50767A4A26AAD0789BDDE2BB79"><enum>(ii)</enum><text>conform to standards satisfactory to the Secretary; and</text></clause><clause id="id88CCADD819314960B372064530C915AF"><enum>(iii)</enum><text>consist of not less than 5 rental units on a site; and</text></clause></subparagraph><subparagraph id="idDC43D5F3380740FFB6874A7E2C7DFB13"><enum>(B)</enum><text>includes units that are detached, semidetached, row house, or multifamily structures.</text></subparagraph></paragraph></subsection><subsection id="id301504349A17484590E0EDB773C90963"><enum>(b)</enum><header>Zoning information reporting requirement</header><paragraph id="id48B0E79CDA8645AAA86C45824802CBB8"><enum>(1)</enum><header>In general</header><text>The Secretary shall require a jurisdiction that receives, directly or indirectly, any funding from the Secretary to submit to the Secretary a report containing information about the zoning and community planning methods of the jurisdiction, unless the jurisdiction already reports such information.</text></paragraph><paragraph id="id3331869AE46B442DB78A9B179FCF4BCA"><enum>(2)</enum><header>Additional information</header><text>Upon receiving a report described in paragraph (1) from a jurisdiction, the Secretary may request additional information, at the discretion of the Secretary.</text></paragraph></subsection><subsection id="idc46de820fb5e4f4785a03ab8d809c9dd"><enum>(c)</enum><header>Prohibited zoning methods</header><paragraph id="id37607D2BAC5F4EA9A2A320AF4CF67083"><enum>(1)</enum><header>In general</header><text>On and after the date that is 180 days after the date of enactment of this Act, a jurisdiction that uses a zoning and community planning method described in paragraph (2) may not receive, directly or indirectly, amounts from a grant awarded under subsection (d).</text></paragraph><paragraph id="id4BF848DB95964075A7B6AEC57DE986A8"><enum>(2)</enum><header>Prohibited methods</header><text>The methods referred to in paragraph (1) are the following:</text><subparagraph id="id4411fb3baffa4350965ff415f41c9b30"><enum>(A)</enum><text>Prohibiting or discouraging duplexes in areas zoned for single-family homes.</text></subparagraph><subparagraph id="id11850a60a1d34d02b689248de6e8bc2c"><enum>(B)</enum><text>Prohibiting or discouraging single-room occupancy development in areas zoned for multifamily homes.</text></subparagraph><subparagraph id="id262ebb8c5c524ed7ae184126ba73b9ec"><enum>(C)</enum><text>In areas within one half-mile of a multimodal transit stop, maintaining requirements of more than 1 parking spot for a resident’s car per residential unit.</text></subparagraph><subparagraph id="idee58aefb7b404cffa1ab5637918367f6"><enum>(D)</enum><text>Prohibiting or discouraging accessory dwelling units (commonly known as an <quote>ADU</quote> or <quote>granny flat</quote>) on the premises of single-family homes.</text></subparagraph><subparagraph id="id9f21f4c02886465fa623f98e90d6d33f"><enum>(E)</enum><text>Prohibiting or discouraging the conversion of commercial property into residential property.</text></subparagraph><subparagraph id="idf4e624564165400bb329ec68db163320"><enum>(F)</enum><text>Prohibiting or discouraging the development of multifamily housing or mixed-use housing in commercial areas.</text></subparagraph></paragraph><paragraph id="id5E353916D318438DA9F23AA9EB7BC3AA" commented="no"><enum>(3)</enum><header>Exception</header><text>A jurisdiction shall not be penalized under paragraph (1) based on the use of a zoning and community planning method described in paragraph (2) over which the jurisdiction does not have control.</text></paragraph></subsection><subsection id="idb7cec23386524f85b15bde52d83dd31a"><enum>(d)</enum><header>Grant program</header><paragraph id="id703719d5dfb64fdda7b659635b361b41"><enum>(1)</enum><header>Establishment</header><text>The Secretary shall establish a program under which the Secretary awards competitive grants to eligible entities to use for eligible activities.</text></paragraph><paragraph id="id1a09ef31096f4a1fa52b575155d508b0"><enum>(2)</enum><header>Priority</header><text>In awarding grants under paragraph (1), the Secretary—</text><subparagraph id="id797E0FFDEB1A4D2386452917B8EE4B06"><enum>(A)</enum><text>shall give priority to an eligible entity that adopt more than one of the zoning and community planning methods described in paragraph (4); and</text></subparagraph><subparagraph id="id9C4C0597CC424FC88F8D1C74731D9994"><enum>(B)</enum><text>in giving priority to an eligible entity under subparagraph (A) of this paragraph, shall base the degree of priority given on the number of such methods that the eligible entity has adopted, relative to the number of such methods that each other eligible entity has adopted.</text></subparagraph></paragraph><paragraph id="id6C4B183BFD1F48FAA10AD5A59AB1472A"><enum>(3)</enum><header>Amount of grant</header><subparagraph id="id492C99BC5BB344448669D750A983F7D2"><enum>(A)</enum><header>In general</header><text>The amount of a grant awarded to an eligible entity under paragraph (1) shall be not less than—</text><clause id="id601c5cddcf034f39ad683712292563a3"><enum>(i)</enum><text>$5,000,000 for an eligible entity with a population of less than 80,000;</text></clause><clause id="id27db6d28538345818ce3dea32897fd60"><enum>(ii)</enum><text>$20,000,000 for an eligible entity with a population of less than 100,000;</text></clause><clause id="id85d055bbd2844e388803d1d571a8572c"><enum>(iii)</enum><text>$40,000,000 for an eligible entity with a population of less than 500,000;</text></clause><clause id="id22ea00a7aefc483faaab8c4d055931f0"><enum>(iv)</enum><text>$100,000,000 for an eligible entity with a population of less than 1,000,000; and</text></clause><clause id="idded9b455d1c44af6a0e2d02de4eb6cab"><enum>(v)</enum><text>$125,000,000 for an eligible entity with a population of not less than 1,000,000.</text></clause></subparagraph><subparagraph id="idC1BDB99AA425445594CA90255B4F5CCF"><enum>(B)</enum><header>Population calculation</header><text>The Secretary shall calculate the population of an eligible entity for purposes of subparagraph (A) using the most recently available data from the Bureau of the Census.</text></subparagraph></paragraph><paragraph id="id46ce5f2df1f84dbe8649583f93dd50a4" commented="no"><enum>(4)</enum><header>Encouraged zoning and community planning methods</header><text>The zoning and community planning methods described in this paragraph are the following:</text><subparagraph id="id3ac9bfd2c66146588e53b3a00ed959c3" commented="no"><enum>(A)</enum><text>Allowing—</text><clause id="id88e5036c2146497b91aeb3ca1d91af7c" commented="no"><enum>(i)</enum><text>duplexes, triplexes, and quadplexes, or other multifamily housing, in areas zoned for single-family homes; </text></clause><clause id="id8ea08430c87145e3a10a086f4d41026b" commented="no"><enum>(ii)</enum><text>the subdivision of existing single-family homes into multiple units; and</text></clause><clause id="id3f3cf1e8a1d547edaa6500084143abd1"><enum>(iii)</enum><text>waivers to permitting or zoning requirements to incentivize the construction of—</text><subclause id="idD5A08532606A402D8144C7F947F50915"><enum>(I)</enum><text>accessory dwelling units;</text></subclause><subclause id="idC059CBE01B594529AE707F58D3243DB4"><enum>(II)</enum><text>additions to existing single-family homes to create duplexes, triplexes, or quadplexes; or</text></subclause><subclause id="idA5886A8BE7AF478B9B8577300EF8E87F"><enum>(III)</enum><text>other additions that do not require demolition of an existing home on a given unit of land.</text></subclause></clause></subparagraph><subparagraph id="idb261c4a3b21e4d0982f57228dedc94f5" commented="no"><enum>(B)</enum><text>Incentivizing the development of single-room occupancy multifamily housing and accessory dwelling units through expedited permitting, reduced fees, or other incentives.</text></subparagraph><subparagraph id="idcc3c59e7dd8a406f9e1022f547d11318" commented="no"><enum>(C)</enum><text>Not imposing a minimum lot size or minimum unit square-foot requirements.</text></subparagraph><subparagraph commented="no" id="id595040950A8C4BEBA95FFF8E5FD85413"><enum>(D)</enum><text>Incentivizing the development of commercial property into residential housing.</text></subparagraph><subparagraph id="idcb07e28b113e430295c15a40e2f22254" commented="no"><enum>(E)</enum><text>Eliminating or lowering requirements for per-unit parking spots.</text></subparagraph><subparagraph id="id7907878c089c4bddb34436d16a5777d5" commented="no"><enum>(F)</enum><text>Allowing increased floor area ratios.</text></subparagraph><subparagraph id="id387399cfe35942daa8ba43519a32624d" commented="no"><enum>(G)</enum><text>Eliminating or raising height limits on development to encourage building vertically rather than horizontally.</text></subparagraph><subparagraph id="id493b4ecdac7f403ba06740f770e3a920"><enum>(H)</enum><text>Waiving or eliminating fees or permits for development in exchange for the development of a larger number of units that are affordable to low-income people.</text></subparagraph></paragraph><paragraph id="id7D4F77A578FD4524AFD1693A25E54A55"><enum>(5)</enum><header>Regulations</header><text>The Secretary may promulgate any regulations necessary to carry out this subsection.</text></paragraph><paragraph commented="no" id="id361DDFACFA97460F8C0803FF45625762"><enum>(6)</enum><header>Authorization of appropriations</header><text>There are authorized to be appropriated to carry out this subsection $4,000,000,000 for each of fiscal years 2022 through 2027.</text></paragraph></subsection></section><section id="id886d8c7acae249dab08db9e9e58e4a4e"><enum>115.</enum><header>Permanent authorization of appropriations for McKinney-Vento Homeless Assistance Act grants</header><text display-inline="no-display-inline">Section 408 of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11364">42 U.S.C. 11364</external-xref>) is amended to read as follows:</text><quoted-block style="OLC" display-inline="no-display-inline" id="idd5a9fe6cfc284eceb9e20f49014c794b"><section id="id73f3d8386a07464ca333d2fcd2fb3508"><enum>408.</enum><header>Authorization of appropriations</header><text display-inline="no-display-inline">There are authorized to be appropriated to carry out this title such sums as may be necessary for each fiscal year.</text></section><after-quoted-block>.</after-quoted-block></quoted-block></section></subtitle><subtitle id="idC4666B26DE674A0D977C0480F113D999" style="OLC"><enum>B</enum><header>Rural housing assistance</header><section id="id74cb15c9242d4e4ba61d046ef88f823e"><enum>121.</enum><header>Rural housing reinvestment</header><subsection id="id33F6F18AD9A44FC481E6EA3EF0BE0FFC"><enum>(a)</enum><header>Definitions</header><text display-inline="yes-display-inline">In this section:</text><paragraph id="id5A9D529EA81240C9BDE5C00CB280F307"><enum>(1)</enum><header>Broad-based nonprofit organization</header><text display-inline="yes-display-inline">The term <term>broad-based nonprofit organization</term> means a nonprofit organization that has a membership that reflects a variety of interests in the area in which housing assisted under this section will be located.</text></paragraph><paragraph id="idb78618a0b4cd49b99c78c639b4cc0eed"><enum>(2)</enum><header>Covered program</header><text>The term <term>covered program</term> means—</text><subparagraph id="ide70068e6905844f5ade1648283c7d764"><enum>(A)</enum><text>the Very Low-Income Housing Repair Loans and Grants Program under section 504 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1474">42 U.S.C. 1474</external-xref>);</text></subparagraph><subparagraph id="id24c669d9239f4c679be696deb851b594"><enum>(B)</enum><text>the Farm Labor Housing loan program under section 514 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1484">42 U.S.C. 1484</external-xref>);</text></subparagraph><subparagraph id="id3a7071c2efd84265b8641167131edf7a"><enum>(C)</enum><text>the Rural Rental Housing Loan program under section 515 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1485">42 U.S.C. 1485</external-xref>);</text></subparagraph><subparagraph id="id067d63ed7e5043489d8e6ad5ee89a07c"><enum>(D)</enum><text>the Farm Labor Housing grant program under section 516 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1486">42 U.S.C. 1486</external-xref>); and</text></subparagraph><subparagraph id="id2146CFC14E214D8683CF0767328064CF"><enum>(E)</enum><text>the Rural Rental Assistance program under section 521 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1490a">42 U.S.C. 1490a</external-xref>).</text></subparagraph></paragraph><paragraph id="id1F2F8D1C544C434F80BD895985D8C8ED"><enum>(3)</enum><header>Domestic farm laborer</header><text>The term <term>domestic farm laborer</term> means an individual who receives a substantial portion of the individual's income from the primary production of processed or unprocessed agricultural or aquacultural commodities or other farm labor employment.</text></paragraph><paragraph id="idB266B13707574DDEABE905472E90FBEE"><enum>(4)</enum><header>Eligible entity</header><text>The term <term>eligible entity</term> means—</text><subparagraph id="id89355854ae0f475c9532d0ab8e825e0e"><enum>(A)</enum><text>a broad-based nonprofit organization;</text></subparagraph><subparagraph id="idD6282420B6064C4CB720DFFCD90E4D64"><enum>(B)</enum><text>a nonprofit organization with experience in developing affordable housing, rural housing, or housing for domestic farm laborers;</text></subparagraph><subparagraph id="id111EC2936F814B868003B96CD72A9897"><enum>(C)</enum><text>a nonprofit organization of domestic farm laborers;</text></subparagraph><subparagraph id="idBE66D54F720F48A58661CD152CE568CB"><enum>(D)</enum><text>a federally recognized Indian Tribe;</text></subparagraph><subparagraph id="id7F365004EA084967BD068F12BD98848A"><enum>(E)</enum><text>a community organization;</text></subparagraph><subparagraph id="idFAD7345153834FF8ACD922A825FD4816"><enum>(F)</enum><text>an agency of a State or of a political subdivision of a State; or</text></subparagraph><subparagraph id="id4694986fea8b45d4a14b5852743365cb"><enum>(G)</enum><text>a limited partnership with a nonprofit general partner.</text></subparagraph></paragraph><paragraph id="id56963539f7374335a1a338f24ea7d904"><enum>(5)</enum><header>Green building certification</header><text>The term <term>green building certification</term> means—</text><subparagraph id="id0f6561b412394964ac39cfb43294510c"><enum>(A)</enum><text>a certification from the Residential New Construction Program of the Energy Star program established by section 324A of the Energy Policy and Conservation Act (<external-xref legal-doc="usc" parsable-cite="usc/42/6294a">42 U.S.C. 6294a</external-xref>); </text></subparagraph><subparagraph id="id55e7aa0462864cc9824b79c26bdbe3f6" commented="no"><enum>(B)</enum><text>a certification from the Zero Energy Ready Home program of the Department of Energy; and</text></subparagraph><subparagraph commented="no" id="id6AAD91E754034CE793D09846ADA2379F"><enum>(C)</enum><text>a certification or accreditation that is substantially similar to a certification described in subparagraph (A) or (B) that requires the housing project to be at least 10 percent more efficient than homes built to the building code standards of the applicable State.</text></subparagraph></paragraph><paragraph id="idB9D880679E394E5D9FBBDA0743F38120"><enum>(6)</enum><header>Low-income</header><text>The term <term>low-income</term> has the meaning given the term in section 1303 of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (<external-xref legal-doc="usc" parsable-cite="usc/12/4502">12 U.S.C. 4502</external-xref>).</text></paragraph><paragraph id="idCA1356FD33DC4590B174A48B02382CE6"><enum>(7)</enum><header>Secretary</header><text>The term <term>Secretary</term> means the Secretary of Agriculture.</text></paragraph></subsection><subsection id="id4a959aa3168c49abbd6c232691ab964a"><enum>(b)</enum><header>Assistance</header><paragraph id="idE977AB561A884EA6A323673F31AB259F"><enum>(1)</enum><header>Loans and grants</header><subparagraph id="id327e9cae97ec44a19939eb4a52916baa"><enum>(A)</enum><header>In general</header><text>The Secretary shall award additional loans and grants, including zero-percent interest loans, under the covered programs to eligible entities that construct or preserve off-farm affordable housing, including multifamily housing, for domestic farm laborers or multifamily housing for low-income individuals living in rural areas to increase and preserve the supply of available and affordable rental housing for—</text><clause id="id7D7DA3F8BC4D4126B85FF986E76D4E43"><enum>(i)</enum><text>low-income individuals living in rural areas; and</text></clause><clause id="id8A37F70458394A6AA52AC302805A2108"><enum>(ii)</enum><text>domestic farm laborers.</text></clause></subparagraph><subparagraph id="id694D4BC1357245F4ABF3D3DFCE9A1BEB"><enum>(B)</enum><header>Timeline</header><clause id="idf43232ce844b40a7a5e735f1f7bc5080"><enum>(i)</enum><header>Notice of funding availability</header><text>Not later than 180 days after the date of enactment of this Act, the Secretary shall publish a notice of funding availability to solicit applications for loans and grants to be awarded under subparagraph (A).</text></clause><clause id="idbd84b699f6f5422890f5819b92968f9f"><enum>(ii)</enum><header>Awards</header><text>Not later than 1 year after the date of enactment of this Act, the Secretary shall award loans and grants, including zero-percent interest loans, to eligible entities under subparagraph (A).</text></clause></subparagraph><subparagraph id="idF46824A74B3F44CFA248B42C76B075B6"><enum>(C)</enum><header>Local contribution for grants</header><clause id="idE8936DF3248C4D8FA5331834372CD582"><enum>(i)</enum><header>In general</header><text>An eligible entity that receives a grant under this section shall contribute not less than 10 percent of the total project cost from sources other than the grant.</text></clause><clause id="idE918E90BD8D2436FA960AA9F762DD247"><enum>(ii)</enum><header>Timing of availability</header><text>An eligible entity may not receive a grant under this section unless the funds required under clause (i) are available to the eligible entity as of the date on which the grant is awarded.</text></clause><clause id="idCC71AE80BBC844DFB262DC04D76AE9C4"><enum>(iii)</enum><header>Sources</header><text>An eligible entity may use amounts from a loan financed by the Rural Housing Service or the Federal Housing Administration to satisfy the requirement under clause (i). </text></clause></subparagraph></paragraph><paragraph id="id484d76865e9e4107be541e1e6d630475"><enum>(2)</enum><header>Rental assistance for off-farm affordable housing and multifamily housing</header><subparagraph id="ide4e5f94ebcbb4dcbb343692ec0beb907"><enum>(A)</enum><header>In general</header><text>In addition to loans and grants under paragraph (1), the Secretary, acting through the Under Secretary for Rural Development, shall provide rental assistance to—</text><clause id="id0155476d370a488fb11e729e37cdf14e"><enum>(i)</enum><text>owners of off-farm affordable housing for domestic farm laborers that is assisted by a loan or grant under paragraph (1); and</text></clause><clause id="id6b34a7388b90495cae96088ef9256fb2"><enum>(ii)</enum><text>owners of affordable multifamily housing for low-income individuals living in rural areas that is assisted by a loan or grant under paragraph (1).</text></clause></subparagraph><subparagraph id="idab73762223da4c17b0fdd17733b6dc11"><enum>(B)</enum><header>Amount of rent</header><text>In providing rental assistance under subparagraph (A), the Secretary shall make assistance payments to the owners of housing described in that subparagraph in order to make available to low-income occupants of such housing rentals at rates commensurate to income and not exceeding the highest of—</text><clause id="id71b594d6acf641fd9892ec8094b1e092"><enum>(i)</enum><text>30 percent of adjusted income (as defined in section 3(b)(5) of the United States Housing Act of 1937 (<external-xref legal-doc="usc" parsable-cite="usc/42/1437a">42 U.S.C. 1437a(b)(5)</external-xref>), except that the amount shall be calculated on a monthly basis);</text></clause><clause id="id48047962b5804a9fa87af1bd7225f2a3"><enum>(ii)</enum><text>10 percent of monthly income; or</text></clause><clause id="id45d7bc1456b9432fbe9824090e396557"><enum>(iii)</enum><text>if the person or family is receiving payments for welfare assistance from a public agency, the portion (if any) of the payments that is specifically designated by the agency to meet the housing costs of the person or family.</text></clause></subparagraph><subparagraph id="idf111ff224d4a4962894fa80cff7aaf20" commented="no"><enum>(C)</enum><header>Cap on rent increases</header><text>The rent or contribution to rent paid by any recipient of assistance under this paragraph shall not increase as a result of this section or any other provision of Federal law or regulation by more than 10 percent during any 12-month period, unless the increase above 10 percent is attributable to increases in income that are unrelated to this subsection or the other provision of Federal law or regulation.</text></subparagraph><subparagraph id="id5d12b6f876fe473c850254b295222d75" commented="no"><enum>(D)</enum><header>Amount of assistance</header><text>The amount of an assistance payment made on behalf of a tenant under this paragraph shall be equal to the difference between—</text><clause commented="no" id="id94BBC19107A645C9983B3CB9988461C7"><enum>(i)</enum><text>the monthly contribution of the tenant, which shall be the applicable amount under subparagraph (B); and</text></clause><clause commented="no" id="idD6893C33F3334EDC9781DBE76A5393F4"><enum>(ii)</enum><text>the fair market rental for the jurisdiction in which the property is located, as established by the Secretary under section 8(c) of the United States Housing Act of 1937 (<external-xref legal-doc="usc" parsable-cite="usc/42/1437a">42 U.S.C. 1437a(c)</external-xref>).</text></clause></subparagraph><subparagraph id="idAABBDD7684DB4056A69131BCB6A22322"><enum>(E)</enum><header>Regulations</header><text>The Secretary may promulgate any regulation that is necessary and proper to carry out this paragraph.</text></subparagraph></paragraph><paragraph id="id02bc3d6727e245e690960e130cb8c8b3"><enum>(3)</enum><header>Priority</header><text>In awarding assistance for farm labor housing and multi-family housing under paragraphs (1) and (2), the Secretary shall give priority to an applicant seeking assistance for a housing project that—</text><subparagraph id="idBD306023DE384061B43006D51943036E"><enum>(A)</enum><text>as determined by the Secretary, is energy efficient and generates energy, such as through geo-exchange systems, ground-source heat pumps, wind turbines, and solar energy systems; or</text></subparagraph><subparagraph id="idE2C48867E5514370A95A26BCB00C276E"><enum>(B)</enum><text>has a green building certification.</text></subparagraph></paragraph></subsection><subsection id="ida92df83dfb0a4daa87ebdc1722464d17"><enum>(c)</enum><header>Funding</header><paragraph id="idb5d5178f0e4e482f8a20ee7ebef1c34f"><enum>(1)</enum><header>Farm Labor Housing loans and grants programs</header><text>There is authorized to be appropriated to the Secretary $78,000,000 for each of fiscal years 2022 through 2032 to award loans and grants under subsection (b)(1)(A) through the Farm Labor Housing loan program and Farm Labor Housing grant program under sections 514 and 516, respectively, of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1484">42 U.S.C. 1484</external-xref>, 1486).</text></paragraph><paragraph id="idc0e23a4a31494f95ad0ed3ef4eb06999"><enum>(2)</enum><header>Rural Rental Housing Loan program</header><text>There is authorized to be appropriated to the Secretary $100,000,000 for each of fiscal years 2022 through 2032 to award loans under subsection (b)(1)(A) through the Rural Rental Housing Loan program under section 515 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1485">42 U.S.C. 1485</external-xref>).</text></paragraph><paragraph id="id0168a9e7ca4f46dea8f8edc029a203a5"><enum>(3)</enum><header>Rural Rental Assistance program</header><text>There is authorized to be appropriated to the Secretary $2,500,000,000 for each of fiscal years 2022 through 2032 to award loans under subsection (b)(1)(A) through the Rural Rental Assistance program under section 521 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1490a">42 U.S.C. 1490a</external-xref>).</text></paragraph><paragraph id="ida9d00651a70e408d81c7d0537571b7dc" commented="no" display-inline="no-display-inline"><enum>(4)</enum><header>Rental assistance under <enum-in-header>(b)(2)</enum-in-header> of this section</header><text>There is authorized to be appropriated to the Secretary $250,000,000 for each of fiscal years 2022 through 2032 for rental assistance payments under subsection (b)(2).</text></paragraph></subsection></section><section id="H693A00AB399F4AB29E9D57011E1004D5"><enum>122.</enum><header>Permanent establishment of housing preservation and revitalization program</header><text display-inline="no-display-inline">Title V of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1471">42 U.S.C. 1471 et seq.</external-xref>) is amended by adding at the end the following:</text><quoted-block display-inline="no-display-inline" id="HEFD3954D25E541E6B62BBE9754EE2F25" style="OLC"><section id="HBBDC0133D23F48CEBCA40A275EDA00F9"><enum>545.</enum><header>Housing preservation and revitalization program</header><subsection id="H177F2C5972D74CAA88023ADF47C5D28A"><enum>(a)</enum><header>Establishment</header><text display-inline="yes-display-inline">The Secretary shall carry out a program under this section for the preservation and revitalization of multifamily rental housing projects financed under section 515 or both sections 514 and 516.</text></subsection><subsection display-inline="no-display-inline" id="H443C3E3705D5476D8F9E121192F073BF"><enum>(b)</enum><header>Notice of maturing loans</header><paragraph id="H293014DC3D374254861E39CBF09CE1A8"><enum>(1)</enum><header>To owners</header><text display-inline="yes-display-inline">On an annual basis, the Secretary shall provide written notice to each owner of a property financed under section 515 or both sections 514 and 516 that will mature within the 4-year period beginning upon the provision of such notice, setting forth the options and financial incentives that are available to facilitate the extension of the loan term or the option to decouple a rental assistance contract pursuant to subsection (f).</text></paragraph><paragraph id="H4C682984EA354E42B70CAED611A80364"><enum>(2)</enum><header>To tenants</header><subparagraph id="HDC734D932BB046A782755877BAA7481C"><enum>(A)</enum><header>In general</header><text display-inline="yes-display-inline">For each property financed under section 515 or both sections 514 and 516, not later than the date that is 2 years before the date that such loan will mature, the Secretary shall provide written notice to each household residing in such property that informs them of the date of the loan maturity, the possible actions that may happen with respect to the property upon such maturity, and how to protect their right to reside in federally assisted housing after such maturity.</text></subparagraph><subparagraph id="HE402B01337CC4C08AD9B69540F2DE427"><enum>(B)</enum><header>Language</header><text>Notice under this paragraph shall be provided in plain English and shall be translated into other languages in the case of any property located in an area in which a significant number of residents speak such other languages.</text></subparagraph></paragraph></subsection><subsection id="H82B4C55A32C24B7FAC73A8398FACF64F"><enum>(c)</enum><header>Loan restructuring</header><text>Under the program under this section, the Secretary may restructure such existing housing loans, as the Secretary considers appropriate, for the purpose of ensuring that such projects have sufficient resources to preserve the projects to provide safe and affordable housing for low-income residents and farm laborers, by—</text><paragraph id="HD57930465304435EB0B4AF27D590BE26"><enum>(1)</enum><text>reducing or eliminating interest;</text></paragraph><paragraph id="H20F5FC26478948B4B562A3FFADD4B6E6"><enum>(2)</enum><text>deferring loan payments;</text></paragraph><paragraph id="HE0414622DFA14A03BEE4D7C6C21EB339"><enum>(3)</enum><text>subordinating, reducing, or reamortizing loan debt; and</text></paragraph><paragraph id="HB359F5F18E1C45659D91B8D33FBB17C9"><enum>(4)</enum><text>providing other financial assistance, including advances, payments, and incentives (including the ability of owners to obtain reasonable returns on investment) required by the Secretary.</text></paragraph></subsection><subsection id="H9D3800EF2EAA4646AD2EFF66DCAE25EC"><enum>(d)</enum><header>Renewal of rental assistance</header><text display-inline="yes-display-inline">When the Secretary offers to restructure a loan pursuant to subsection (c), the Secretary shall offer to renew the rental assistance contract under section 521(a)(2) for a 20-year term that is subject to annual appropriations, provided that the owner agrees to bring the property up to such standards that will ensure its maintenance as decent, safe, and sanitary housing for the full term of the rental assistance contract.</text></subsection><subsection id="H09F8DF4045CE46D5A2016DDA60FAE526"><enum>(e)</enum><header>Restrictive use agreements</header><paragraph id="HD4476D5379A5441D939F53B27B4400BB"><enum>(1)</enum><header>Requirement</header><text display-inline="yes-display-inline">As part of the preservation and revitalization agreement for a project, the Secretary shall obtain a restrictive use agreement that obligates the owner to operate the project in accordance with this title.</text></paragraph><paragraph id="H4A7C602FBD634372B946F0AE53F1306B"><enum>(2)</enum><header>Term</header><subparagraph id="H6AC483FDDA8F4630BA8952EBA851EFBD"><enum>(A)</enum><header>No extension of rental assistance contract</header><text>Except when the Secretary enters into a 20-year extension of the rental assistance contract for the project, the term of the restrictive use agreement for the project shall be consistent with the term of the restructured loan for the project.</text></subparagraph><subparagraph id="HEC47AE2BB8C94549B3DC87CA56E114D9"><enum>(B)</enum><header>Extension of rental assistance contract</header><text>If the Secretary enters into a 20-year extension of the rental assistance contract for a project, the term of the restrictive use agreement for the project shall be for 20 years.</text></subparagraph><subparagraph id="H56024C0AD023477EB24C9F3E870C2A2C"><enum>(C)</enum><header>Termination</header><text>The Secretary may terminate the 20-year use restrictive use agreement for a project prior to the end of its term if the 20-year rental assistance contract for the project with the owner is terminated at any time for reasons outside the owner’s control.</text></subparagraph></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="HFBC93D25CDF042ED9A45888BBFBBE0AB"><enum>(f)</enum><header>Decoupling of rental assistance</header><paragraph id="HFCDAAA8D9AB847D58A7264A38500A9FD"><enum>(1)</enum><header>Renewal of rental assistance contract</header><text display-inline="yes-display-inline">If the Secretary determines that a maturing loan for a project cannot reasonably be restructured in accordance with subsection (c) and the project was operating with rental assistance under section 521, the Secretary may renew the rental assistance contract, notwithstanding any provision of section 521, for a term, subject to annual appropriations, of at least 10 years but not more than 20 years.</text></paragraph><paragraph id="HFAF04D2E82774DF289DB16446DE07961"><enum>(2)</enum><header>Rents</header><text>Any agreement to extend the term of the rental assistance contract under section 521 for a project shall obligate the owner to continue to maintain the project as decent, safe, and sanitary housing and to operate the development in accordance with this title, except that rents shall be based on the lesser of—</text><subparagraph id="HA9713CBF9EA748AA8011A9A283518C74"><enum>(A)</enum><text>the budget-based needs of the project; or</text></subparagraph><subparagraph id="HEF1EBD6845524B11A9FBA8D408431889"><enum>(B)</enum><text>(the operating cost adjustment factor as a payment standard as provided under section 524 of the Multifamily Assisted Housing Reform and Affordability Act of 1997 (<external-xref legal-doc="usc" parsable-cite="usc/42/1437">42 U.S.C. 1437</external-xref> note)).</text></subparagraph></paragraph></subsection><subsection id="HE2A643BF268647D9B42F5A9BC1434D2C"><enum>(g)</enum><header>Multifamily housing transfer technical assistance</header><text display-inline="yes-display-inline">Under the program under this section, the Secretary may provide grants to qualified nonprofit organizations and public housing agencies to provide technical assistance, including financial and legal services, to borrowers under loans under this title for multifamily housing to facilitate the acquisition of such multifamily housing properties in areas where the Secretary determines there is a risk of loss of affordable housing.</text></subsection><subsection id="HE9ED9F7D95F54BDA9D044F2454A759AA"><enum>(h)</enum><header>Transfer of rental assistance</header><text display-inline="yes-display-inline">After the loan or loans for a rental project originally financed under section 515 or both sections 514 and 516 have matured or have been prepaid and the owner has chosen not to restructure the loan pursuant to subsection (c), a tenant residing in such project shall have 18 months prior to loan maturation or prepayment to transfer the rental assistance assigned to the tenant’s unit to another rental project originally financed under section 515 or both sections 514 and 516, and the owner of the initial project may rent the tenant’s previous unit to a new tenant without income restrictions.</text></subsection><subsection id="H19D16BC38A7447038DAA7182B4FE465C"><enum>(i)</enum><header>Administrative expenses</header><text>Of any amounts made available for the program under this section for any fiscal year, the Secretary may use not more than $1,000,000 for administrative expenses for carrying out such program.</text></subsection><subsection id="HC787FB721AF247E5A81FA5AB1082EC13"><enum>(j)</enum><header>Authorization of appropriations</header><text>There is authorized to be appropriated for the program under this section $200,000,000 for each of fiscal years 2022 through 2027.</text></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></section><section display-inline="no-display-inline" id="H8833252BC00345D1B3355B65AF4753F9" section-type="subsequent-section"><enum>123.</enum><header>Eligibility for rural housing vouchers</header><text display-inline="no-display-inline">Section 542 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1490r">42 U.S.C. 1490r</external-xref>) is amended by adding at the end the following:</text><quoted-block display-inline="no-display-inline" id="HF84AA479E1DD4073815D60EC057F1291" style="OLC"><subsection id="H25AA3BF290A24403B20A5F4CD53AE8C6"><enum>(c)</enum><header>Eligibility of households in section 514, 515, and 516 projects</header><text display-inline="yes-display-inline">The Secretary may provide rural housing vouchers under this section for any low-income household (including those not receiving rental assistance) residing in a property financed with a loan made or insured under section 514 or 515 (<external-xref legal-doc="usc" parsable-cite="usc/42/1484">42 U.S.C. 1484</external-xref>, 1485) which has been prepaid, has been foreclosed, or has matured after September 30, 2005, or residing in a property assisted under section 514 or 516 that is owned by a nonprofit organization or public agency.</text></subsection><after-quoted-block>.</after-quoted-block></quoted-block></section><section display-inline="no-display-inline" id="H19625E9B828441CCBDC8A9B79C45CCCE"><enum>124.</enum><header>Amount of voucher assistance</header><text display-inline="no-display-inline">Notwithstanding any other provision of law, in the case of any rural housing voucher provided pursuant to section 542 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1490r">42 U.S.C. 1490r</external-xref>), the amount of the monthly assistance payment for the household on whose behalf such assistance is provided shall be determined as provided in subsection (a) of such section 542.</text></section><section id="HEC35ADA080D4407BBD54264C89F632FA"><enum>125.</enum><header>Use of available rental assistance</header><text display-inline="no-display-inline">Section 521(d) of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1490a">42 U.S.C. 1490a(d)</external-xref>) is amended by adding at the end the following:</text><quoted-block display-inline="no-display-inline" id="HA06E162A3B354E6DB0AB68C184800BAE" style="OLC"><paragraph id="H1AEBA01BBCB54369A33C390D8ECE185D" indent="up1"><enum>(3)</enum><text display-inline="yes-display-inline">In the case of any rental assistance contract authority that becomes available because of the termination of assistance on behalf of an assisted family—</text><subparagraph id="HEF584F231CAA403FB7713CD003EFCAE6"><enum>(A)</enum><text display-inline="yes-display-inline">at the option of the owner of the rental project, the Secretary shall provide the owner a period of 6 months before such assistance is made available pursuant to subparagraph (B) during which the owner may use such assistance authority to provide assistance on behalf of an eligible unassisted family that—</text><clause id="HA5F574744EA249B49CE2FA271F6D0E0F"><enum>(i)</enum><text>is residing in the same rental project that the assisted family resided in prior to such termination; or</text></clause><clause id="H02B98EEF8D8743B3A97F9127EEF942ED"><enum>(ii)</enum><text>newly occupies a dwelling unit in such rental project during such period; and</text></clause></subparagraph><subparagraph id="H6EDDE7617A76496EAA70612F39C2ED0E"><enum>(B)</enum><text>except for assistance used as provided in subparagraph (A), the Secretary shall use such remaining authority to provide such assistance on behalf of eligible families residing in other rental projects originally financed under section 515 or both sections 514 and 516.</text></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></section><section id="H8DCACF08937643A684A03692605BA1D3"><enum>126.</enum><header>Funding for multifamily technical improvements</header><text display-inline="no-display-inline">There is authorized to be appropriated to the Secretary of Agriculture $50,000,000 for fiscal year 2022 for improving the technology of the Department of Agriculture used to process loans for multifamily housing and otherwise managing such housing. Such improvements shall be made within the 5-year period beginning upon the appropriation of such amounts and such amount shall remain available until the expiration of such 5-year period.</text></section><section id="HB2D703A8BD1E4CD2960270B92408D221" section-type="subsequent-section"><enum>127.</enum><header>Plan for preserving affordability of rental projects</header><subsection id="H2913EE51C5FE4C028250F96FFE3C4D38"><enum>(a)</enum><header>Plan</header><text display-inline="yes-display-inline">Not later than 180 days after the date of enactment of this Act, the Secretary of Agriculture (in this section referred to as the <term>Secretary</term>) shall submit a written plan to Congress for preserving the affordability for low-income families of rental projects for which loans were made under section 515 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1485">42 U.S.C. 1485</external-xref>) or made to nonprofit or public agencies under section 514 of that Act (<external-xref legal-doc="usc" parsable-cite="usc/42/1484">42 U.S.C. 1484</external-xref>) and avoiding the displacement of tenant households, which shall—</text><paragraph id="H84A29881CF424ABFAC443B28276229F0"><enum>(1)</enum><text>set forth specific performance goals and measures;</text></paragraph><paragraph id="H27900D21250041448495311890DB7290"><enum>(2)</enum><text display-inline="yes-display-inline">set forth the specific actions and mechanisms by which such goals will be achieved;</text></paragraph><paragraph id="HBAB868FC7B5848E0BA0672CBEB81659F"><enum>(3)</enum><text>set forth specific measurements by which progress towards achievement of each goal can be measured;</text></paragraph><paragraph id="H7E087A80BEF7487E98CB807E16C3BEAB"><enum>(4)</enum><text>provide for detailed reporting on outcomes; and</text></paragraph><paragraph id="H4E782508A8964D73AF16850ACBA12ADA"><enum>(5)</enum><text>include any legislative recommendations to assist in achievement of the goals under the plan.</text></paragraph></subsection><subsection id="H2C43781C3FF3487C815BBDAA8BF52AEB"><enum>(b)</enum><header>Advisory committee</header><paragraph id="HB41C2630312245CA9D231ED685455B65"><enum>(1)</enum><header>Establishment; purpose</header><text display-inline="yes-display-inline">The Secretary shall establish an advisory committee whose purpose shall be to assist the Secretary—</text><subparagraph id="idF259E23C02FD4DD9BEDA04CB7F8D44DC"><enum>(A)</enum><text display-inline="yes-display-inline">in preserving properties assisted under section 514 or 515 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1484">42 U.S.C. 1484</external-xref>, 1485) that are owned by nonprofit or public agencies through the multifamily housing preservation and revitalization program under section 545 of that Act (as added by this subtitle); and</text></subparagraph><subparagraph id="id113AC8E4778842E5BD94252AA43CDB1F"><enum>(B)</enum><text display-inline="yes-display-inline">implementing the plan required under subsection (a) of this section.</text></subparagraph></paragraph><paragraph id="H2A54770B47764CDD9BF1615CD10D0A62"><enum>(2)</enum><header>Member</header><text display-inline="yes-display-inline">The advisory committee shall consist of 14 members, appointed by the Secretary, as follows:</text><subparagraph id="H1641D1952F5C4BAC9095594E8AF92517"><enum>(A)</enum><text>A State Director of Rural Development for the Department of Agriculture.</text></subparagraph><subparagraph id="HEE026D25C2924F7C85FBE014A242D56D"><enum>(B)</enum><text>The Administrator for Rural Housing Service of the Department of Agriculture.</text></subparagraph><subparagraph id="H3DD885B3F89F4D9A9D437E59233578C3"><enum>(C)</enum><text display-inline="yes-display-inline">Two representatives of for-profit developers or owners of multifamily rural rental housing.</text></subparagraph><subparagraph id="H573C9DFCB5604746A4576B992732CBE9"><enum>(D)</enum><text display-inline="yes-display-inline">Two representatives of nonprofit developers or owners of multifamily rural rental housing.</text></subparagraph><subparagraph id="HB43B79748B574C158C64171E43CC5C73"><enum>(E)</enum><text>Two representatives of State housing finance agencies.</text></subparagraph><subparagraph id="HF94B4175D2544D3E907937F3E2AD00DD"><enum>(F)</enum><text display-inline="yes-display-inline">Two representatives of tenants of multifamily rural rental housing.</text></subparagraph><subparagraph id="H2DA661D9AD56411DA5FA2E9D781159D8"><enum>(G)</enum><text display-inline="yes-display-inline">One representative of a community development financial institution that is involved in preserving the affordability of housing assisted under sections 514, 515, and 516 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1484">42 U.S.C. 1484</external-xref>, 1485, 1486).</text></subparagraph><subparagraph id="H021649A91EA24DF186C25DF4E6A5FDBD"><enum>(H)</enum><text display-inline="yes-display-inline">One representative of a nonprofit organization that operates nationally and has actively participated in the preservation of housing assisted by the Rural Housing Service by conducting research regarding, and providing financing and technical assistance for, preserving the affordability of such housing.</text></subparagraph><subparagraph id="H5CBEAF02C2FE44C0AE4F468FB8C5A581"><enum>(I)</enum><text>One representative of low-income housing tax credit investors.</text></subparagraph><subparagraph id="HD8ADAD924C824AC9AEEC0C1D59E56A26"><enum>(J)</enum><text display-inline="yes-display-inline">One representative of regulated financial institutions that finance affordable multifamily rural rental housing developments.</text></subparagraph></paragraph><paragraph id="HA49E6ACE57294A46870E671F6806AF5B"><enum>(3)</enum><header>Meetings</header><text>The advisory committee shall meet not less often than once each calendar quarter.</text></paragraph><paragraph id="HC54E5390EC744D6C9D53EE43BE5949FB"><enum>(4)</enum><header>Functions</header><text display-inline="yes-display-inline">In providing assistance to the Secretary to carry out its purpose, the advisory committee shall carry out the following functions:</text><subparagraph id="H59B0D909EDB74A5E9612F5FEF7CB5B7F"><enum>(A)</enum><text>Assisting the Rural Housing Service of the Department of Agriculture to improve estimates of the size, scope, and condition of rental housing portfolio of the Service, including the time frames for maturity of mortgages and costs for preserving the portfolio as affordable housing.</text></subparagraph><subparagraph id="H30496F4D5DB843F8A16D4E6A59398336"><enum>(B)</enum><text display-inline="yes-display-inline">Reviewing current policies and procedures of the Rural Housing Service regarding preservation of affordable rental housing financed under sections 514, 515, 516, and 538 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1484">42 U.S.C. 1484</external-xref>, 1485, 1486, 1490p–2), the Multifamily Preservation and Revitalization Demonstration program (commonly known as the <quote>MPR</quote>), and the Rural Rental Assistance program under section 521 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1490a">42 U.S.C. 1490a</external-xref>) and making recommendations regarding improvements and modifications to such policies and procedures.</text></subparagraph><subparagraph id="HCB9EE1EE1E9841C88519560427230AAA"><enum>(C)</enum><text>Providing ongoing review of Rural Housing Service program results.</text></subparagraph><subparagraph id="H5DFE7304EDA14D5E85C3C2A3A2DA2DFF"><enum>(D)</enum><text>Providing reports to Congress and the public on meetings, recommendations, and other findings of the advisory committee.</text></subparagraph></paragraph></subsection></section><section display-inline="no-display-inline" id="HCDA39440D7E54CE28F26BBC7D379353B" section-type="subsequent-section"><enum>128.</enum><header>Covered housing programs</header><text display-inline="no-display-inline">Section 41411(a)(3) of the Violence Against Women Act of 1994 (<external-xref legal-doc="usc" parsable-cite="usc/34/12491">34 U.S.C. 12491(a)(3)</external-xref>) is amended—</text><paragraph id="H74ECBEF19E974CADBE1887DE53F0E5F5"><enum>(1)</enum><text>in subparagraph (I), by striking <quote>and</quote> at the end;</text></paragraph><paragraph id="HDADC3CE6DBB2468FB0F7675928794FC3"><enum>(2)</enum><text display-inline="yes-display-inline">by redesignating subparagraph (J) as subparagraph (K); and</text></paragraph><paragraph id="HA2E033C90C3F49E88878DCE0178ABB56"><enum>(3)</enum><text>by inserting after subparagraph (I) the following:</text><quoted-block display-inline="no-display-inline" id="H69A6C404FBDD41A6BB326DA9478D820D" style="OLC"><subparagraph id="H66088A771A644948A8936A8443EF44CE"><enum>(J)</enum><text display-inline="yes-display-inline">rural development housing voucher assistance provided by the Secretary of Agriculture under section 542 of the Housing Act of 1949 (<external-xref legal-doc="usc" parsable-cite="usc/42/1490r">42 U.S.C. 1490r</external-xref>), without regard to subsection (b) of that section, and applicable appropriation Acts; and</text></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></section></subtitle><enum>II</enum><header>Revenue provisions</header><section id="id931C864FE925418ABEF27AB73BDB9E79"><enum>201.</enum><header>Extension of period for rehabilitation expenditures</header><subsection id="id687b62c3c2414490952df8fa3a528698"><enum>(a)</enum><header>In general</header><text>Clause (ii) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(e)(3)(A)</external-xref> of the Internal Revenue Code of 1986 is amended by inserting <quote>(any 36-month period, in the case of buildings receiving an allocation of housing credit dollar amount before January 1, 2023)</quote> after <quote>24-month period</quote>.</text></subsection><subsection id="id5C4F997C282B405193E8BE131C0E4C05"><enum>(b)</enum><header>Conforming amendment</header><text>Subparagraph (A) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(e)(4)</external-xref> of the Internal Revenue Code of 1986 is amended by inserting <quote>(or 36-month period, if applicable)</quote> after <quote>24-month period</quote>.</text></subsection><subsection id="id4f9e759879ca41e7af1632a1746f7ce8"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to buildings receiving an allocation of housing credit dollar amount after December 31, 2017.</text></subsection></section><section id="id2B18067B332E40769886378E92C5A5FD"><enum>202.</enum><header>Extension of basis expenditure deadline</header><subsection id="id14571C5163964A78B0D3984F17CED996"><enum>(a)</enum><header>In general</header><text>Clause (i) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(1)(E)</external-xref> of the Internal Revenue Code of 1986 is amended by inserting <quote>(the third calendar year, in the case of an allocation made before January 1, 2023)</quote> after <quote>second calendar year</quote>.</text></subsection><subsection id="idCB4F244F82834BACB707F9985DD9F6A9"><enum>(b)</enum><header>Qualified building</header><text>Clause (ii) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(1)(E)</external-xref> of the Internal Revenue Code of 1986 is amended—</text><paragraph id="idAB0007F6A7B540969BFA1AD1EC1B4BC9"><enum>(1)</enum><text>by striking <quote>the date which is 1 year after the date that the allocation was made</quote> and inserting <quote>the applicable date</quote>;</text></paragraph><paragraph id="idA21D3899CFBA4FE4850D0F443DB9B6D0"><enum>(2)</enum><text>by inserting <quote>(or third, if applicable)</quote> after <quote>second</quote> in the first sentence;</text></paragraph><paragraph id="id63E05082A1684C4E8AE576EF168A4908"><enum>(3)</enum><text>by inserting <quote>(or third)</quote> after <quote>second</quote> in the second sentence;</text></paragraph><paragraph id="idD19410DAAAA94658836179F16CF8394C"><enum>(4)</enum><text>by striking <quote><header-in-text style="OLC" level="clause">building</header-in-text>.—For purposes of</quote> and inserting “<header-in-text level="clause" style="OLC">building</header-in-text>.—</text><quoted-block style="OLC" display-inline="no-display-inline" id="id8B3E793A283C47C0B80C609CA8C125AD"><subclause id="idE8A1A87B7134437EBB7B1354D3124E65"><enum>(I)</enum><header>In general</header><text>For purposes of</text></subclause><after-quoted-block>; and</after-quoted-block></quoted-block></paragraph><paragraph id="idF7EE44D30869475DB754C73AC3E107E4"><enum>(5)</enum><text>by adding at the end the following new subclause:</text><quoted-block style="OLC" display-inline="no-display-inline" id="id4D86D3E564D341C9B3E91DACB2BF3D6E"><subclause id="id921929793E9F40FF8A190ACCF09C5D02"><enum>(II)</enum><header>Applicable date</header><text>For purposes of subclause (I), the applicable date is 1 year after the date that the allocation was made with respect to the building (2 years, in the case of allocations made before January 1, 2023).</text></subclause><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection id="idFABB19BE1A7B4016A73B09944D709DEC" commented="no" display-inline="no-display-inline"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to buildings receiving an allocation of housing credit dollar amount after December 31, 2017.</text></subsection></section><section id="idFF88B992599C4096AE6F0213AAE2D519"><enum>203.</enum><header>Tax-exempt bond financing requirement</header><subsection id="id584E81FEF6A94DADA9178C427957970C"><enum>(a)</enum><header>In general</header><text>Subparagraph (B) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(4)</external-xref> of the Internal Revenue Code of 1986 is amended by adding at the end the following: <quote>The preceding sentence shall be applied by substituting <quote>25 percent</quote> for <quote>50 percent</quote> in the case of any building which is financed by any obligation issued in calendar year 2021, 2022, 2023, or 2024 (and not by any previously issued obligation).</quote>.</text></subsection><subsection id="id94F52054B99947D28244DC131D68930B"><enum>(b)</enum><header>Effective date</header><text>The amendment made by this section shall apply to buildings placed in service in taxable years beginning after December 31, 2021.</text></subsection></section><section section-type="subsequent-section" id="id64CDC347C70D4D08AC8C9F7BB1E91C5D"><enum>204.</enum><header>Increases in State allocations</header><subsection id="idA350F1B81A8B4869ACF2DC4EA46F594E"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Clause (ii) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(3)(C)</external-xref> of the Internal Revenue Code of 1986 is amended—</text><paragraph id="id2BEEA5175DFC455897DC39374EC3B1DE"><enum>(1)</enum><text>by striking <quote>$1.75</quote> in subclause (I) and inserting <quote>$4.92 ($3.88 in the case of calendar year 2021)</quote>; and</text></paragraph><paragraph id="idC565489F33334BE08CA32212F0B4353E"><enum>(2)</enum><text>by striking <quote>$2,000,000</quote> in subclause (II) and inserting <quote>$5,670,462 ($4,462,734 in the case of calendar year 2021)</quote>.</text></paragraph></subsection><subsection id="idC9D725D6E83A499EA2A61F29F7ADD39F"><enum>(b)</enum><header>Cost-of-Living adjustment</header><text>Subparagraph (H) of section 42(h)(3) of such Code is amended—</text><paragraph id="id71CE5760B38A4158889E7DF41AC29747"><enum>(1)</enum><text>by striking <quote>2002</quote> in clause (i) and inserting <quote>2022</quote>;</text></paragraph><paragraph id="id2FC2CD5EB4C24BA4B3AEBA2A497D93E3"><enum>(2)</enum><text>by striking <quote>the $2,000,000 and $1.75 amounts in subparagraph (C)</quote> in clause (i) and inserting <quote>the dollar amounts applicable to such calendar year under subclauses (I) and (II) of subparagraph (C)(ii)</quote>;</text></paragraph><paragraph id="id3058683D024D4490BC7F28FE70546696"><enum>(3)</enum><text>by striking <quote>2001</quote> in clause (i)(II) and inserting <quote>2021</quote>;</text></paragraph><paragraph id="id7DEB0DD4BD094B5EB6727B544D97670E"><enum>(4)</enum><text>by striking <quote>$2,000,000 amount</quote> in clause (ii)(I) and inserting <quote>amount under subparagraph (C)(ii)(II)</quote>; and</text></paragraph><paragraph id="idAC23B891AC2349F3B0EE766C62D3A59F"><enum>(5)</enum><text>by striking <quote>$1.75 amount</quote> in clause (ii)(II) and inserting <quote>amount under subparagraph (C)(ii)(I)</quote>.</text></paragraph></subsection><subsection id="id7FE4161E0EFA40CB8354722CA526C22D" commented="no" display-inline="no-display-inline"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to calendar years beginning after December 31, 2020. </text></subsection></section><section id="id4514045BE71D4694960CDAE0831552CB"><enum>205.</enum><header>Buildings designated to serve extremely low-income households</header><subsection id="idBE1A46B69D2F46F4AEE0E672373FAE58"><enum>(a)</enum><header>Reserved State allocation</header><paragraph id="id59887ECD15884F8397CED56EAE93EBE2"><enum>(1)</enum><header>In general</header><text>Subsection (h) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42</external-xref> of the Internal Revenue Code of 1986 is amended—</text><subparagraph id="id712F053ED28C4EBB8648E143F3D00392"><enum>(A)</enum><text>by redesignating paragraphs (6), (7), and (8) as paragraphs (7), (8), and (9), respectively; and</text></subparagraph><subparagraph id="id60BDBB5A80C64F0FAFFE5CF82EBBC004"><enum>(B)</enum><text>by inserting after paragraph (5) the following new paragraph:</text><quoted-block style="OLC" display-inline="no-display-inline" id="id94F4080A070D45BCA4AB6837ECD4E039"><paragraph id="idDC580DEE491D46D888D3A3330629EB21"><enum>(6)</enum><header>Portion of State ceiling set-aside for projects designated to serve extremely low-income households</header><subparagraph id="id6E8F8F89236145C4BCBEAE8918256A65"><enum>(A)</enum><header>In general</header><text>Not more than 90 percent of the State housing credit ceiling for any State for any calendar year shall be allocated to buildings other than buildings described in subparagraph (B).</text></subparagraph><subparagraph id="id1EA0E780638941069D41208CD0086D75"><enum>(B)</enum><header>Buildings described</header><text>A building is described in this subparagraph if 20 percent or more of the residential units in such building are rent-restricted (determined as if the imputed income limitation applicable to such units were 30 percent of area median gross income) and are designated by the taxpayer for occupancy by households the aggregate household income of which does not exceed the greater of—</text><clause id="id6FC90AB80E1C45B9A55FA79C281CDCA1"><enum>(i)</enum><text>30 percent of area median gross income, or</text></clause><clause id="idBC693C75F40A46509EBDC6E761273B10"><enum>(ii)</enum><text>100 percent of an amount equal to the Federal poverty line (within the meaning of section 36B(d)(3)).</text></clause></subparagraph><subparagraph id="id48D1923FB0CF4665A1D5A6013B39E43F"><enum>(C)</enum><header>State may not override set-aside</header><text>Nothing in subparagraph (F) of paragraph (3) shall be construed to permit a State not to comply with subparagraph (A) of this paragraph.</text></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></subparagraph></paragraph><paragraph id="idE1940F096D904E70B918F7DD373D1B69"><enum>(2)</enum><header>Conforming amendment</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/42">Section 42(b)(4)(C)</external-xref> of the Internal Revenue Code of 1986 is amended by striking <quote>(h)(7)</quote> and inserting <quote>(h)(8)</quote>.</text></paragraph></subsection><subsection id="idDF47E7679A5447B6B176619E07646DE6"><enum>(b)</enum><header>Increase in credit</header><text>Paragraph (5) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(d)</external-xref> of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:</text><quoted-block id="id4656683F0EE04E2196D9D23733D606F8" display-inline="no-display-inline" style="OLC" act-name=""><subparagraph id="id83BCAB9DAC9A48BBA4053B4380117613"><enum>(C)</enum><header>Increase in credit for projects designated to serve extremely low-income households</header><text>In the case of any building—</text><clause id="id5ACBE5C788BC47B698CAF097CA06BA89"><enum>(i)</enum><text>which is described in subsection (h)(6)(B), and</text></clause><clause id="id8ADA4809F4FB4754B858E7A9EA80A345"><enum>(ii)</enum><text>which is designated by the housing credit agency as requiring the increase in credit under this subparagraph in order for such building to be financially feasible as part of a qualified low-income housing project,</text></clause><continuation-text commented="no" continuation-text-level="subparagraph">subparagraph (B) shall not apply to the portion of such building which is comprised of such units, and the eligible basis of such portion of the building shall be 150 percent of such basis determined without regard to this subparagraph.</continuation-text></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="id4A62FB86C7C64B06BC7A523F241D2264" commented="no" display-inline="no-display-inline"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to buildings which receive allocations of housing credit dollar amount or, in the case of projects financed by tax-exempt bonds as described in <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(4)</external-xref> of the Internal Revenue Code of 1986, which receive a determination of housing credit dollar amount, after the date of the enactment of this Act. </text></subsection></section><section id="id60AE639ED7044B3597F7E3CFF46168AE"><enum>206.</enum><header>Inclusion of Indian areas as difficult development areas for purposes of certain buildings</header><subsection id="id068B1C47C34F4EC2BEFF92467DF090D6"><enum>(a)</enum><header>In general</header><text>Subclause (I) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(d)(5)(B)(iii)</external-xref> of the Internal Revenue Code of 1986 is amended by inserting before the period the following: <quote>, and any Indian area</quote>.</text></subsection><subsection id="idBB81EF0BD91A445A913AAFFC57A93C35"><enum>(b)</enum><header>Indian area</header><text>Clause (iii) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(d)(5)(B)</external-xref> of the Internal Revenue Code of 1986 is amended by redesignating subclause (II) as subclause (IV) and by inserting after subclause (I) the following new subclauses:</text><quoted-block act-name="" id="idAD1A742DFF95432B9583EBE705CD8B07" style="OLC"><subclause id="id9D93ED04FE934223816E6AA14BD01ADC"><enum>(II)</enum><header>Indian area</header><text>For purposes of subclause (I), the term <term>Indian area</term> means any Indian area (as defined in section 4(11) of the Native American Housing Assistance and Self Determination Act of 1996 (<external-xref legal-doc="usc" parsable-cite="usc/25/4103">25 U.S.C. 4103(11)</external-xref>)).</text></subclause><subclause id="id11C00A78C24D47C6892465CA9677A655" commented="no" display-inline="no-display-inline"><enum>(III)</enum><header display-inline="yes-display-inline">Special rule for buildings in Indian areas</header><text display-inline="yes-display-inline">In the case of an area which is a difficult development area solely because it is an Indian area, a building shall not be treated as located in such area unless such building is assisted or financed under the Native American Housing Assistance and Self Determination Act of 1996 (<external-xref legal-doc="usc" parsable-cite="usc/25/4101">25 U.S.C. 4101 et seq.</external-xref>) or the project sponsor is an Indian tribe (as defined in section 45A(c)(6)), a tribally designated housing entity (as defined in section 4(22) of such Act (<external-xref legal-doc="usc" parsable-cite="usc/25/4103">25 U.S.C. 4103(22)</external-xref>)), or wholly owned or controlled by such an Indian tribe or tribally designated housing entity. </text></subclause><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="id41A884DBBBF345BA985C824068FB85B2" commented="no" display-inline="no-display-inline"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to buildings placed in service after December 31, 2021.</text></subsection></section><section id="id5A97BFC5E6714FACB332C780369FE733"><enum>207.</enum><header>Inclusion of rural areas as difficult development areas</header><subsection id="id37323DD5668D4DD6922C26552740A35C"><enum>(a)</enum><header>In general</header><text>Subclause (I) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(d)(5)(B)(iii)</external-xref> of the Internal Revenue Code of 1986, as amended by section 206, is further amended by inserting <quote>, any rural area</quote> after <quote>median gross income</quote>.</text></subsection><subsection id="idA4030745FD7E4D3EAC359C3321CD8191"><enum>(b)</enum><header>Rural area</header><text>Clause (iii) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(d)(5)(B)</external-xref> of the Internal Revenue Code of 1986, as amended by section 206, is further amended by redesignating subclause (IV) as subclause (V) and by inserting after subclause (III) the following new subclause:</text><quoted-block act-name="" id="id0B12DA9C94C8481592EF48D67D485B08" style="OLC"><subclause id="idE9A471098BB741E69BC6451AB0BA1416"><enum>(IV)</enum><header>Rural area</header><text>For purposes of subclause (I), the term <term>rural area</term> means any non-metropolitan area, or any rural area as defined by section 520 of the Housing Act of 1949, which is identified by the qualified allocation plan under subsection (m)(1)(B).</text></subclause><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="id016062786316481BAB3D5F459B0685D5" commented="no" display-inline="no-display-inline"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to buildings placed in service after December 31, 2021. </text></subsection></section><section id="id02165DC6E9CF4F5682FAE5D77ECA9D98"><enum>208.</enum><header>Increase in credit for bond-financed projects designated by housing credit agency</header><subsection id="id39E35FA01DF24D6DA99DCBAC7225B6DF"><enum>(a)</enum><header>In general</header><text>Clause (v) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(d)(5)(B)</external-xref> of the Internal Revenue Code of 1986 is amended by striking the second sentence.</text></subsection><subsection id="id71273FE3B044421DAB48094D6810F72A"><enum>(b)</enum><header>Technical amendments</header><text>Clause (v) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(d)(5)(B)</external-xref> of the Internal Revenue Code of 1986, as amended by subsection (a), is further amended—</text><paragraph id="id6E77C32B44B14DB0B3888EBDD3EC7E27"><enum>(1)</enum><text>by striking <quote><header-in-text level="clause" style="OLC">State</header-in-text></quote> in the heading; and</text></paragraph><paragraph id="id0DF1793C68DD4EEC837CCABE969FDBE0"><enum>(2)</enum><text>by striking <quote>State housing credit agency</quote> and inserting <quote>housing credit agency</quote>.</text></paragraph></subsection><subsection id="id04C10324BA534EE7AA1CECEE0D09218B" commented="no" display-inline="no-display-inline"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to buildings which receive a determination of housing credit dollar amount after the date of the enactment of this Act. </text></subsection></section><section id="id26CEAA8CABDC422C9BDA17B935D05ADD" section-type="subsequent-section"><enum>209.</enum><header>Repeal of qualified contract option</header><subsection id="id3F05DD9E787F42BE830FCE6E5C772617"><enum>(a)</enum><header>Termination of option for certain buildings</header><paragraph id="id52CC65555BDE409F9EB53015602A76FC"><enum>(1)</enum><header>In general</header><text display-inline="yes-display-inline">Subclause (II) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(7)(E)(i)</external-xref> of the Internal Revenue Code of 1986, as redesignated by section 205, is amended by inserting <quote>in the case of a building described in clause (iii),</quote> before <quote>on the last day</quote>.</text></paragraph><paragraph id="idC172E74B6082461E8F6113F1EEE21371"><enum>(2)</enum><header>Buildings described</header><text>Subparagraph (E) of section 42(h)(7) of such Code, as so redesignated, is amended by adding at the end the following new clause:</text><quoted-block display-inline="no-display-inline" id="id12E91ACFA81B4B8EBE782E6E6F1A7E9E" style="OLC"><clause id="id48C0548EC89C47C9B7CFE8DE38DDF1D8"><enum>(iii)</enum><header>Buildings described</header><text>A building described in this clause is a building—</text><subclause id="id49AE043152C546DB85DBD987217FFE32"><enum>(I)</enum><text>which received its allocation of housing credit dollar amount before January 1, 2021, or</text></subclause><subclause id="id535C603472884D4DA880B47778F8A353"><enum>(II)</enum><text>in the case of a building any portion of which is financed as described in paragraph (4), which received before January 1, 2021, a determination from the issuer of the tax-exempt bonds or the housing credit agency that the building is eligible to receive an allocation of housing credit dollar amount under the rules of paragraphs (1) and (2) of subsection (m).</text></subclause></clause><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection id="idF1BBE29D004848B8A9444688362FA6E7"><enum>(b)</enum><header>Rules relating to existing projects</header><text>Subparagraph (F) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(7)</external-xref> of the Internal Revenue Code of 1986, as redesignated by section 205, is amended by striking <quote>the nonlow-income portion</quote> and all that follows and inserting <quote>the nonlow-income portion and the low-income portion of the building for fair market value (determined by the housing credit agency by taking into account the rent restrictions required for the low-income portion of the building to continue to meet the standards of paragraphs (1) and (2) of subsection (g)). The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out this paragraph.</quote>.</text></subsection><subsection id="idBDF1E66B428E418BB7DADF6BF0E72C18"><enum>(c)</enum><header>Conforming amendments</header><paragraph id="idE36A70A6865F40DDA3F01DA0B2496403"><enum>(1)</enum><text>Paragraph (7) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)</external-xref> of the Internal Revenue Code of 1986, as redesignated by section 205, is amended by striking subparagraph (G) and by redesignating subparagraphs (H), (I), (J), and (K) as subparagraphs (G), (H), (I), and (J), respectively.</text></paragraph><paragraph id="id4F562C394FA643D1A9BCB383920E1C08"><enum>(2)</enum><text>Subclause (II) of section 42(h)(7)(E)(i) of such Code, as so redesignated and as amended by subsection (a), is further amended by striking <quote>subparagraph (I)</quote> and inserting <quote>subparagraph (H)</quote>.</text></paragraph></subsection><subsection id="id1E214B2BF488491A95718524D4C7AE9B"><enum>(d)</enum><header>Technical amendment</header><text>Subparagraph (I) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(7)</external-xref> of the Internal Revenue Code of 1986, as redesignated by section 205 and subsection (c), is amended by striking <quote>agreement</quote> and inserting <quote>commitment</quote>.</text></subsection><subsection id="idF9BEA827F1324B29923FD2463B5225AE" commented="no" display-inline="no-display-inline"><enum>(e)</enum><header>Effective date</header><text>The amendments made by this section shall apply to buildings with respect to which a written request described in <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(7)(H)</external-xref> of the Internal Revenue Code of 1986, as redesignated by section 205 and subsection (c), is submitted after the date of the enactment of this Act. </text></subsection></section><section commented="no" display-inline="no-display-inline" id="idB3C81427D98C4823AE8B7CA5A69F1982"><enum>210.</enum><header>Modification and clarification of rights relating to building purchase</header><subsection commented="no" display-inline="no-display-inline" id="id815DA4C8E25F4B12A1CDFA836B71D6E1"><enum>(a)</enum><header>Modification of right of first refusal</header><paragraph commented="no" display-inline="no-display-inline" id="idB4F00A7229FC4D4B924CCDDF412D4D58"><enum>(1)</enum><header>In general</header><text>Subparagraph (A) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(i)(7)</external-xref> of the Internal Revenue Code of 1986 is amended by striking <quote>a right of 1st refusal</quote> and inserting <quote>an option</quote>.</text></paragraph><paragraph display-inline="no-display-inline" commented="no" id="idDB45AEF2CC6B461A8255AB97F8B43E7D"><enum>(2)</enum><header>Conforming amendment</header><text>The heading of paragraph (7) of section 42(i) of such Code is amended by striking <quote><header-in-text style="OLC" level="paragraph">right of 1st refusal</header-in-text></quote> and inserting <quote><header-in-text style="OLC" level="paragraph">option</header-in-text></quote>.</text></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="id50D551D77E5D4519961FDB57D559B99E"><enum>(b)</enum><header>Clarification with respect to right of first refusal and purchase options</header><paragraph commented="no" display-inline="no-display-inline" id="id74264FB69BA441BD8728913D38CBC38A"><enum>(1)</enum><header>Purchase of partnership interest</header><text>Subparagraph (A) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(i)(7)</external-xref> of the Internal Revenue Code of 1986, as amended by subsection (a), is amended by striking <quote>the property</quote> and inserting <quote>the property or all of the partnership interests (other than interests of the person exercising such option or a related party thereto (within the meaning of section 267(b) or 707(b)(1))) relating to the property</quote>.</text></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id1355940996744693A7A1B9A3350A72A3"><enum>(2)</enum><header>Property includes assets relating to the building</header><text>Paragraph (7) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(i)</external-xref> of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:</text><quoted-block style="OLC" display-inline="no-display-inline" id="id6E8DB1A7E5F24558AD0EC1721955B01B"><subparagraph commented="no" display-inline="no-display-inline" id="id6F7A5E0CFBA2409E96D70748BCCE234E"><enum>(C)</enum><header>Property</header><text>For purposes of subparagraph (A), the term <term>property</term> may include all or any of the assets held for the development, operation, or maintenance of a building.</text></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id418DBDA33F6D45A98327E5413602803B"><enum>(3)</enum><header>Exercise of right of first refusal and purchase options</header><text>Subparagraph (A) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(i)(7)</external-xref> of the Internal Revenue Code of 1986, as amended by subsection (a) and paragraph (1)(A), is amended by adding at the end the following: “For purposes of determining whether an option, including a right of first refusal, to purchase property or partnership interests holding (directly or indirectly) such property is described in the preceding sentence—</text><quoted-block style="OLC" display-inline="no-display-inline" id="idCE748ACAE66A4760A7A726384C79980E"><clause commented="no" display-inline="no-display-inline" id="id471AF0AD6C6D432D9D4575A59E4F7A80"><enum>(i)</enum><text>such option or right of first refusal shall be exercisable with or without the approval of any owner of the project (including any partner, member, or affiliated organization of such an owner), and</text></clause><clause commented="no" display-inline="no-display-inline" id="id1796469055AC4645960E45EA0899029C"><enum>(ii)</enum><text>a right of first refusal shall be exercisable in response to any offer to purchase the property or partnership interests, including an offer by a related party.</text></clause><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="id4396B5A88CC84C37AEA7E333A5CC3D2D"><enum>(c)</enum><header>Conforming amendments</header><text>Subparagraph (B) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(i)(7)</external-xref> of the Internal Revenue Code of 1986 is amended by striking <quote>the sum of</quote> and all that follows and inserting <quote>the principal amount of outstanding indebtedness secured by the building (other than indebtedness incurred within the 5-year period ending on the date of the sale to the tenants). In the case of a purchase of a partnership interest, the minimum purchase price is an amount not less than such interest's ratable share of the amount determined under the first sentence of this subparagraph.</quote>.</text></subsection><subsection commented="no" display-inline="no-display-inline" id="id0782C12C98494873807808305341DB2C"><enum>(d)</enum><header>Effective dates</header><paragraph commented="no" display-inline="no-display-inline" id="id9515DE9FFEA244E9AA1814E8C4F39687"><enum>(1)</enum><header>Modification of right of first refusal</header><text>The amendment made by subsection (a) shall apply to agreements entered into or amended after the date of the enactment of this Act.</text></paragraph><paragraph commented="no" display-inline="no-display-inline" id="idB246BB26DD5F48698EA29CCD5D0F49EA"><enum>(2)</enum><header>Clarification</header><text>The amendments made by subsections (b) and (c) shall apply to agreements among the owners of the project (including partners, members, and their affiliated organizations) and persons described in <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(i)(7)(A)</external-xref> of the Internal Revenue Code of 1986 entered into before, on, or after the date of the enactment of this Act.</text></paragraph><paragraph id="id1F543CA8DC5842CBA8F8700F6938ADAD" commented="no" display-inline="no-display-inline"><enum>(3)</enum><header>No effect on agreements</header><text>None of the amendments made by this section is intended to supersede express language in any agreement with respect to the terms of a right of first refusal or option permitted by <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(i)(7)</external-xref> of the Internal Revenue Code of 1986 in effect on the date of the enactment of this Act.</text></paragraph></subsection></section><section id="idB8A024E5DCB24E4584A3C71D82C7FFDF"><enum>211.</enum><header>Prohibition of local approval and contribution requirements</header><subsection id="id83123639E6D549C5B72478242FEADB0C"><enum>(a)</enum><header>In general</header><text>Paragraph (1) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(m)</external-xref> of the Internal Revenue Code of 1986 is amended—</text><paragraph id="idF31BF7E35E5E4C32BC2881302B371498"><enum>(1)</enum><text>by striking clause (ii) of subparagraph (A) and by redesignating clauses (iii) and (iv) thereof as clauses (ii) and (iii); and</text></paragraph><paragraph id="id2344E5D056494CE29BF2DD513BF14AD8"><enum>(2)</enum><text>by adding at the end the following new subparagraph:</text><quoted-block act-name="" id="id78FD140AC9D94965B4A900E289F32214" style="OLC"><subparagraph id="id0273C3196F7A448781A9ADC3700A6EB1"><enum>(E)</enum><header>Local approval or contribution not taken into account</header><text>The selection criteria under a qualified allocation plan shall not include consideration of—</text><clause id="idFB94E28D21944B32BF4785E9BC6CDD5B"><enum>(i)</enum><text>any support or opposition with respect to the project from local or elected officials, or</text></clause><clause id="idFEA3AF8E234A4BEFAEBDF4896A1D76BA"><enum>(ii)</enum><text>any local government contribution to the project, except to the extent such contribution is taken into account as part of a broader consideration of the project's ability to leverage outside funding sources, and is not prioritized over any other source of outside funding.</text></clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection id="idF320ABBCBCBC4FD6978E7117D3621DA2" commented="no" display-inline="no-display-inline"><enum>(b)</enum><header>Effective date</header><text>The amendments made by this section shall apply to allocations of housing credit dollar amounts made after December 31, 2021.</text><pagebreak></pagebreak></subsection></section><section commented="no" display-inline="no-display-inline" id="id366DA1109A474023B480420F2774B19D"><enum>212.</enum><header>Adjustment of credit to provide relief during COVID–19 outbreak</header><subsection commented="no" display-inline="no-display-inline" id="id1600B38D7BA148658319632C1CDC76D4"><enum>(a)</enum><header>In general</header><text>At the election of a taxpayer who is an owner of an eligible low-income building—</text><paragraph commented="no" display-inline="no-display-inline" id="idE567B8DF58EC4AF58B6457E7ED144EEC"><enum>(1)</enum><text>the credit determined under <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42</external-xref> of the Internal Revenue Code of 1986 for the first or second taxable year of such building’s credit period ending on or after July 1, 2020, shall be 150 percent of the amount which would (but for this subsection) be so allowable with respect to such building for such taxable year; and</text></paragraph><paragraph id="idc440cdf23b394a3c8a40f3dba7649cae"><enum>(2)</enum><text>the aggregate credits allowable under such section with respect to such building shall be reduced, on a pro rata basis for each subsequent taxable year in the credit period, by the increase in the credit allowed by reason of paragraph (1) with respect to such first or second taxable year.</text></paragraph><continuation-text continuation-text-level="subsection">The preceding sentence shall not be construed to affect whether any taxable year is part of the credit, compliance, or extended use periods for purposes of such section 42. </continuation-text></subsection><subsection id="idd945e536642e484ea11c3475c90129a2"><enum>(b)</enum><header>Eligible low-Income building</header><text>For purposes of this section, the term <term>eligible low-income building</term> means a qualified low-income building with respect to which—</text><paragraph id="id26E925CA7AB0461291D5194F493C9B59"><enum>(1)</enum><text>the first year in the credit period ends on or after July 1, 2020, and before July 1, 2022; and</text></paragraph><paragraph id="id0787741A235D458C93338C0F560E362F"><enum>(2)</enum><text>construction or leasing delays have occurred after January 31, 2020, due to the outbreak of coronavirus disease 2019 (COVID–19) in the United States.</text></paragraph></subsection><subsection id="id1f9219ccf52c41bc8883cc91e5275d8b"><enum>(c)</enum><header>Election</header><paragraph id="id89F236AAAA7B4773A99FE0E52F79F0C7"><enum>(1)</enum><header>In general</header><text>The election under subsection (a) shall be made at such time and in such manner as shall be prescribed by the Secretary of the Treasury (or the Secretary's delegate) and, once made, shall be irrevocable by the taxpayer and any successor in ownership.</text></paragraph><paragraph id="idCD4ECD1C07DE4920B07DC3DC9F87DD9B"><enum>(2)</enum><header>Partnerships</header><text>In the case of an eligible low-income building owned by a partnership or S corporation, such election shall be made at the entity level.</text></paragraph><paragraph id="idFF28DABA0C1940DE9E383D6F235E4AF6"><enum>(3)</enum><header>Certification</header><text>An owner making such election shall provide to the housing credit agency, at the same time and in addition to such other information as may be required under <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(l)(1)</external-xref> of the Internal Revenue Code of 1986 with respect to the building, a certification that the purpose of making such election is to offset any reductions in capital or additional costs arising by reason of the outbreak of coronavirus disease 2019 (COVID–19) in the United States. Such certification shall include any documentation which the housing credit agency may request.</text></paragraph></subsection><subsection id="id27B18BB7721448D18FC690467966B445"><enum>(d)</enum><header>Definitions</header><text>Any term used in this section which is also used in <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42</external-xref> of the Internal Revenue Code of 1986 shall have the same meaning as when used in such section.</text></subsection></section><section id="id84CDB4F4BB1F4B6591A96FFE31420895"><enum>213.</enum><header>Increase in credit for low-income housing supportive services</header><subsection id="id86B2E72CC4B24F1B975BC91F4D1EABBE"><enum>(a)</enum><header>In general</header><text>Paragraph (5) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(d)</external-xref> of the Internal Revenue Code of 1986, as amended by section 205, is further amended by adding at the end the following new subparagraphs:</text><quoted-block style="OLC" act-name="" id="idDCFAB845999E4541BF347D3AE04D4FEC"><subparagraph id="idEA2B4867C92E4D80A248B05BC693400C"><enum>(D)</enum><header>Increase in credit for providing supportive services</header><clause id="id7BB07CEA88FE4B50A2E870973231EF3A"><enum>(i)</enum><header>In general</header><text>In the case of any building which includes common areas, or property used therein, dedicated to the provision of on-site qualified supportive services, except as provided in subparagraphs (E) and (F), the eligible basis of the portion of the building which is comprised of such areas or property (after the application of subparagraphs (A) and (B)) shall be increased by an amount equal to 50 percent of such basis determined without regard to this subparagraph and subparagraphs (B) and (C).</text></clause><clause id="id4DDF84EC58E14B5795EE529A13C7EA99"><enum>(ii)</enum><header>Qualified supportive services</header><text>For purposes of clause (i), the term <term>qualified supportive services</term> means services—</text><subclause id="id0F9362BABA244C84B100E89F83DDAA49"><enum>(I)</enum><text>provided by the owner of a building (directly or through contracts with third-party service providers) primarily to tenants of the building,</text></subclause><subclause id="idf45c3ac3006942c095a4a674d51cbf2e"><enum>(II)</enum><text>which are intended to promote economic self-sufficiency and physical and mental health and well-being in pursuit of retaining permanent housing, including childcare or eldercare services, health services, coordination of tenant benefits, job training, financial counseling, resident engagement services, or such other similar services as may be defined by the allocating agency in the qualified allocation plan,</text></subclause><subclause id="id17E896BAA2D6430E95BDE977A7845744"><enum>(III)</enum><text>which are provided to tenants and other beneficiaries as may be specified by the housing credit agency, including specifications as to which services may be provided to non-tenants,</text></subclause><subclause id="id262eeee1302848a1b723cfd03fe24a7a"><enum>(IV)</enum><text>which are provided at no cost to beneficiaries other than any fee, copay, or coinsurance customarily charged by service providers for similar services, and</text></subclause><subclause id="id48e33be36ce64d7a9098eee054e6859b"><enum>(V)</enum><text>usage of or participation in which is not a condition of tenancy in the building.</text></subclause><continuation-text continuation-text-level="clause">Such term includes reasonable and necessary measures for the provision of such services, including measures to engage tenants and other beneficiaries in and coordinate such services, and measures required to obtain the certification described in subparagraph (E)(ii)(III).</continuation-text></clause></subparagraph><subparagraph id="idd59cdce0c053460cb6e2cf2b2843ccea" commented="no"><enum>(E)</enum><header>Extended supportive services commitment</header><clause commented="no" id="id70D557CE227048F8B77BCA8F29325812"><enum>(i)</enum><header>In general</header><text>Subparagraph (D)(i) shall not apply to a building for any taxable year unless an extended supportive services commitment is in effect for such taxable year.</text></clause><clause commented="no" id="id3388EB962A474F9083CC40C5CAB4F191"><enum>(ii)</enum><header>Extended supportive services commitment</header><text>The term <term>extended supportive services commitment</term> means any agreement between the owner of a building and the housing credit agency which—</text><subclause id="id8850df97f37c47c2962e673e4542a1d5" commented="no"><enum>(I)</enum><text>provides estimates of the amounts to be spent, updated at least once every 5 years, on the provision of qualified supportive services to tenants of such building and other beneficiaries for each taxable year remaining in the credit period, </text></subclause><subclause id="ida222042f2b5d4f2a82ace840721db953" commented="no"><enum>(II)</enum><text>requires the designation of one or more individuals to engage tenants regarding and coordinate delivery of qualified supportive services,</text></subclause><subclause id="id0232259d50274037ae87d03e1fd8049a" commented="no"><enum>(III)</enum><text>requires the maintenance of an appropriate certification, as determined by the Secretary in consultation with the housing credit agencies, for qualified supportive services, subject to recertification at least once every 5 years,</text></subclause><subclause id="id8dca85ddc73f4ce7b39b800e6bfad59d" commented="no"><enum>(IV)</enum><text>requires appropriate annual reporting to the housing credit agency on expenditures and outcomes, as determined by such agency, and</text></subclause><subclause id="id74a7bd5a5a134d1f8694389affe8b80d" commented="no"><enum>(V)</enum><text>is binding on all successors in ownership of such building.</text></subclause></clause><clause id="id1765EAE56C524B829DF2174F09F4145A"><enum>(iii)</enum><header>Exceptions if foreclosure or if no buyer willing to maintain services</header><text>The requirement of clause (ii)(V) for any building shall terminate on the date the building is acquired by foreclosure (or instrument in lieu of foreclosure) unless the housing credit agency determines that such acquisition is part of an arrangement with the taxpayer a purpose of which is to terminate such requirement.</text></clause><clause id="idC0A8F1990BDC43088FA232DDFAC26663"><enum>(iv)</enum><header>Effect of noncompliance</header><text>If, during a taxable year, there is a determination by the housing credit agency that an extended supportive services commitment was not in effect as of the beginning of such year or that there is evidence of other noncompliance as determined by the housing credit agency (including failure to provide qualified supportive services)—</text><subclause id="id38E3AF02EA674C79A15389F6E22B7840"><enum>(I)</enum><text>such determination shall not apply to any period before such year and subparagraph (D)(i) shall apply to such taxable year without regard to such determination if the failure is corrected within 1 year from the date of the determination, and</text></subclause><subclause id="id97A41DE9766047F9A1293A6788CCC538"><enum>(II)</enum><text>in the case of any year to which such determination does apply, if the failure is not corrected within 1 year from the date of the determination, the credit recapture amount under subsection (j)(1) for the year in which such 1 year period expires shall be increased by the amount of any increase in the credit under this section by reason of subparagraph (D)(i) for the year to which the determination applies.</text></subclause></clause><clause id="id19B9B427E8684ABC83390E73BADD6DD2"><enum>(v)</enum><header>Projects which consist of more than 1 building</header><text>Rules similar to the rules of subsection (h)(7)(J) shall apply.</text></clause></subparagraph><subparagraph id="idEBF69C203F894D2C8A3DAFB9B2B9D186"><enum>(F)</enum><header>Responsibilities of housing credit agency</header><text>Subparagraph (D)(i) shall not apply to a building for any taxable year unless—</text><clause id="id849d171b834e4c3fa343e61f65af38e0"><enum>(i)</enum><text>the housing credit agency sets forth criteria—</text><subclause id="idBED9B27F1C194D5683BFBDA861B653B4"><enum>(I)</enum><text>to determine appropriate, evidence-based supportive services,</text></subclause><subclause id="id6BDA4D05EEF546B08D4146E00420837E"><enum>(II)</enum><text>for the selection of appropriate and competent service providers, and</text></subclause><subclause id="idC0EBEA45503B4BDC80114548F92F627F"><enum>(III)</enum><text>which common areas or property described in subparagraph (D)(i) shall meet in order to qualify for the increase in credit under subparagraph (D),</text></subclause></clause><clause id="idBB14FC9FDD9841B8BC4567EC2E70F8AB"><enum>(ii)</enum><text>the housing credit agency provides a procedure that the agency (or an agent or other private contractor of such agency) shall follow in monitoring for noncompliance with the provisions of this subparagraph and subparagraphs (D) and (E) and in reporting such noncompliance to the Secretary, and</text></clause><clause id="ida421938143bd4ac7a5828ce7fb1835bb"><enum>(iii)</enum><text>appropriate books and records for expenditures with respect to the qualified supportive services are maintained on an annual basis, and are available for inspection upon request by the housing credit agency.</text></clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="idAE3B31F19DC249BA9422F129F662A94B" commented="no" display-inline="no-display-inline"><enum>(b)</enum><header>Effective date</header><text>The amendment made by this section shall apply to buildings which receive allocations of housing credit dollar amount or, in the case of projects financed by tax-exempt obligations as described in <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(4)</external-xref> of the Internal Revenue Code of 1986, which are first taken into account under section 146 of such Code, after the date of the enactment of this Act.</text></subsection></section><section id="id003ed47d94a94062b6205d7678a886f1"><enum>214.</enum><header>Study of tax incentives for the conversion of commercial property to affordable housing</header><text display-inline="no-display-inline">Within 6 months of the date of the enactment of this Act, the Secretary of the Treasury, the Secretary of Housing and Urban Development, the Deputy Under Secretary for Rural Development of the Department of Agriculture, and the Director of the Office of Management and Budget shall collaborate to produce a cost-benefit analysis of providing tax incentives, including the non-recognition of capital gains, to the owners of vacant or under-utilized commercial real estate in exchange for selling these properties to State, local, or tribal housing finance agencies for conversion to affordable rental housing for low-income residents, including shelters for the homeless.</text></section><section id="idD116DB19BC524D46B3F4B250491B5657"><enum>215.</enum><header>Renters credit</header><subsection commented="no" display-inline="no-display-inline" id="idD405A96B3CFC4EFA844370FC6385FE6B"><enum>(a)</enum><header display-inline="yes-display-inline">In general</header><text display-inline="yes-display-inline">Subpart C of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986 is amended by inserting after section 36B the following new section:</text><quoted-block style="OLC" display-inline="no-display-inline" id="idE41CDC4098154CAFB5CFD895D3BA8C61"><section commented="no" display-inline="no-display-inline" section-type="subsequent-section" id="id75BC7B39B62A4F8E95FE0C30E37E19A0"><enum>36C.</enum><header display-inline="yes-display-inline">Renters credit</header><subsection commented="no" display-inline="no-display-inline" id="id99E22C6F8BF346B088ACDD372E3EF941"><enum>(a)</enum><header>Allowance of credit</header><paragraph commented="no" display-inline="no-display-inline" id="id951EEA6A41B74B6B80E2643F87D65FEB"><enum>(1)</enum><header>In general</header><text>There shall be allowed as a credit against the tax imposed by this subtitle for any taxable year an amount equal to the sum of the amounts determined under paragraph (2) for all qualified buildings with a credit period which includes months occurring during the taxable year.</text></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id0711444E88A14F27AB02723EAA723B87"><enum>(2)</enum><header>Qualified building amount</header><text>The amount determined under this paragraph with respect to any qualified building for any taxable year shall be an amount equal to the lesser of—</text><subparagraph commented="no" display-inline="no-display-inline" id="id64210A2152E54976A0FBB1D16AF076C6"><enum>(A)</enum><text>the aggregate qualified rental reduction amounts for all eligible units within such building for months occurring during the taxable year which are within the credit period for such building, or</text></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id3C73C9494E5049F180F68B9B6B73B3C2"><enum>(B)</enum><text>the rental reduction credit amount allocated to such building for such months.</text></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id9EACB5D031C24739B2D02F3CD46D6B94"><enum>(3)</enum><header>Qualified building</header><text>For purposes of this section—</text><subparagraph commented="no" display-inline="no-display-inline" id="id46D994601EBA4BEBB837EF8095E578FA"><enum>(A)</enum><header>In general</header><text>The term <term>qualified building</term> means any building which is residential rental property (as defined in section 168(e)(2)(A)) of the taxpayer with respect to which—</text><clause commented="no" display-inline="no-display-inline" id="idC7AAFA2478194D2CB587DDBDE5474761"><enum>(i)</enum><text>a rental reduction credit amount has been allocated by a rental reduction credit agency of a State, and</text></clause><clause commented="no" display-inline="no-display-inline" id="id1EACBE38FB2C4286B3E03741E02B0569"><enum>(ii)</enum><text>a qualified rental reduction agreement is in effect.</text></clause></subparagraph><subparagraph id="idF67427F8053C485B9A2ED07CFC3E9B1F"><enum>(B)</enum><header>Building not disqualified by other assistance</header><text>A building shall not fail to be treated as a qualified building merely because—</text><clause id="id92FC6D38DA2F495CA7E2F82B1EE9E0A1"><enum>(i)</enum><text>a credit was allowed under section 42 with respect to such building or there was any other Federal assistance in the construction or rehabilitation of such building,</text></clause><clause id="id4AB834645D3843CBB76C9C7658FE6B41"><enum>(ii)</enum><text>the rehabilitation credit determined under section 47 was allowed under section 38 with respect to such building, or</text></clause><clause id="id51AA7A0F189E4232BB1A3EAE8B0743A6"><enum>(iii)</enum><text>Federal rental assistance was provided for such building during any period preceding the credit period.</text></clause></subparagraph></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="idA60D12445C3D4DD180037ED5830D2137"><enum>(b)</enum><header>Qualified rental reduction amount</header><text>For purposes of this section—</text><paragraph commented="no" display-inline="no-display-inline" id="id937B9F06BEFB4000AF553AAA718FE490"><enum>(1)</enum><header>In general</header><text>The term <term>qualified rental reduction amount</term> means, with respect to any eligible unit for any month, an amount equal to the applicable percentage (as determined under subsection (e)(1)) of the excess of—</text><subparagraph commented="no" display-inline="no-display-inline" id="id26E9347C6F164FAFA053E28B77664D89"><enum>(A)</enum><text>the applicable rent for such unit, over</text></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id64E49EBE799448B79801346983969E72"><enum>(B)</enum><text>the family rental payment required for such unit.</text></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="id8E85CC566C524A91B9BD77DAFAA01C81"><enum>(2)</enum><header>Applicable rent</header><subparagraph commented="no" display-inline="no-display-inline" id="id1B1D8C4154A04EE3A23B459130C04A7F"><enum>(A)</enum><header>In general</header><text>The term <term>applicable rent</term> means, with respect to any eligible unit for any month, the lesser of—</text><clause commented="no" display-inline="no-display-inline" id="id7B99651C12C44D4F80B8C640F9FF2A34"><enum>(i)</enum><text>the amount of rent which would be charged for a substantially similar unit with the same number of bedrooms in the same building which is not an eligible unit, or</text></clause><clause commented="no" display-inline="no-display-inline" id="id209E6611DB8E442298D1FC96488AE6D4"><enum>(ii)</enum><text>an amount equal to the market rent standard for such unit.</text></clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id84256ADE54F34924A8F69B15DC816E20"><enum>(B)</enum><header>Market rent standard</header><clause commented="no" display-inline="no-display-inline" id="id10B84CC88EAC4D0AA831C25585EBED53"><enum>(i)</enum><header>In general</header><text>The market rent standard with respect to any eligible unit is—</text><subclause commented="no" display-inline="no-display-inline" id="id61F177DCBB744DCFBEA77DAEF5C7E9E0"><enum>(I)</enum><text>the small area fair market rent determined by the Secretary of Housing and Urban Development for units with the same number of bedrooms in the same zip code tabulation area, or</text></subclause><subclause commented="no" display-inline="no-display-inline" id="idA0CFE2BA767F46AAB910A5E896DE191D"><enum>(II)</enum><text>if there is no rent described in subclause (I) for such area, the fair market rent determined by such Secretary for units with the same number of bedrooms in the same county.</text></subclause></clause><clause commented="no" display-inline="no-display-inline" id="idB96549C8331040088152EB66C10594D2"><enum>(ii)</enum><header>State option</header><text>A State may in its rental reduction allocation plan provide that the market rent standard for all (or any part) of a zip code tabulation area or county within the State shall be equal to a percentage (not less than 75 nor more than 125) of the amount determined under clause (i) (after application of clause (iii)) for such area or county.</text></clause><clause commented="no" display-inline="no-display-inline" id="idAA5E45475DF94E7B8E03B7791DAE6969"><enum>(iii)</enum><header>Minimum amount</header><text>Notwithstanding clause (i), the market rent standard with respect to any eligible unit for any year in the credit period after the first year in the credit period for such unit shall not be less than the market rent standard determined for such first year.</text></clause></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="idBE7159962BF440B1B66488FED601C76F"><enum>(3)</enum><header>Family rental payment requirements</header><subparagraph commented="no" display-inline="no-display-inline" id="idB6FFCB23C199448CB1F3D1F406C0EAB9"><enum>(A)</enum><header>In general</header><text>Each qualified rental reduction agreement with respect to any qualified building shall require that the family rental payment for an eligible unit within such building for any month shall be equal to the lesser of—</text><clause commented="no" display-inline="no-display-inline" id="id9058052E298E4B89BC91A487A0B90280"><enum>(i)</enum><text>30 percent of the monthly family income of the residents of the unit (as determined under subsection (e)(5)), or</text></clause><clause commented="no" display-inline="no-display-inline" id="id7C8B8DB8DFAA48B6A224475CF7F3F2A7"><enum>(ii)</enum><text>the applicable rent for such unit.</text></clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id53D85C185727412DAB2FA659CE081124"><enum>(B)</enum><header>Utility costs</header><text>Any utility allowance (determined by the Secretary in the same manner as under section 42(g)(2)(B)(ii)) paid by residents of an eligible unit shall be taken into account as rent in determining the family rental payment for such unit for purposes of this paragraph.</text></subparagraph></paragraph></subsection><subsection id="id872FF975C47F4628BEBB8EF7BF8079E3"><enum>(c)</enum><header>Rental reduction credit amount</header><text>For purposes of this section—</text><paragraph id="id0A8A89F536304FB4842BC51A57B26C93"><enum>(1)</enum><header>Determination of amount</header><subparagraph id="id5971C103B0D442B79A9E109CBBFCD21C"><enum>(A)</enum><header>In general</header><text>The term <term>rental reduction credit amount</term> means, with respect to any qualified building, the dollar amount which is allocated to such building (and to eligible units within such building) under this subsection. Such dollar amount shall be allocated to months in the credit period with respect to such building (and such units) on the basis of the estimates described in paragraph (2)(B).</text></subparagraph><subparagraph id="idE3AAB31307D7477ABAB417DBAEAD7A9C"><enum>(B)</enum><header>Allocation on project basis</header><text>In the case of a project which includes (or will include) more than 1 building, the rental reduction credit amount shall be the dollar amount which is allocated to such project for all buildings included in such project. Subject to the limitation under subsection (e)(3)(B), such amount shall be allocated among such buildings in the manner specified by the taxpayer unless the qualified rental reduction agreement with respect to such project provides for such allocation.</text></subparagraph></paragraph><paragraph id="idBE0C4555C786471DB8B9839CE01E3732"><enum>(2)</enum><header>State allocation</header><subparagraph id="idAB70E14D935A43FD8256E3593FBFEE81"><enum>(A)</enum><header>In general</header><text>Except as provided in subparagraph (C), each rental reduction credit agency of a State shall each calendar year allocate its portion of the State rental reduction credit ceiling to qualified buildings (and to eligible units within each such building) in accordance with the State rental reduction allocation plan.</text></subparagraph><subparagraph id="id0C57C46E09DE4406932D40CDFE8722BF"><enum>(B)</enum><header>Allocations to each building</header><text>The rental reduction credit amount allocated to any qualified building shall not exceed the aggregate qualified rental reduction amounts which such agency estimates will occur over the credit period for eligible units within such building, based on reasonable estimates of rents, family incomes, and vacancies in accordance with procedures established by the State as part of its State rental reduction allocation plan.</text></subparagraph><subparagraph id="idBC000CA8D4B24E67BF81F3161816EFB8"><enum>(C)</enum><header>Specific allocations</header><clause id="idB12049FBD46C4E87AA379F4B3EA02EA7"><enum>(i)</enum><header>Nonprofit organizations</header><text>At least 25 percent of the State rental reduction credit ceiling for any State for any calendar year shall be allocated to qualified buildings in which a qualified nonprofit organization (as defined in section 42(h)(5)(C)) owns (directly or through 1 or more partnerships) an interest and materially participates (within the meaning of section 469(h)) in the operation of the building throughout the credit period. A State may waive or lower the requirement under this clause for any calendar year if it determines that meeting such requirement is not feasible.</text></clause><clause id="idA651ADB93D4B48629D63B812A4EC4132"><enum>(ii)</enum><header>Rural areas</header><subclause id="idFB984E1CB5054CEBB7C684E6688410C0"><enum>(I)</enum><header>In general</header><text>The State rental reduction credit ceiling for any State for any calendar year shall be allocated to buildings in rural areas (as defined in section 520 of the Housing Act of 1949) in an amount which, as determined by the Secretary of Housing and Urban Development, bears the same ratio to such ceiling as the number of extremely low-income households with severe rent burdens in such rural areas bears to the total number of such households in the State.</text></subclause><subclause id="id8C4E728770CA44C2860FEA30FE65DB0E"><enum>(II)</enum><header>Alternative 5-year testing period</header><text>In the case of the 5-calendar year period beginning in 2021, a State shall not be treated as failing to meet the requirements of subclause (I) for any calendar year in such period if, as determined by the Secretary, the average annual amount allocated to such rural areas during such period meets such requirements.</text></subclause></clause></subparagraph></paragraph><paragraph id="id37A4B42482684D1990C8D16D359C1F91"><enum>(3)</enum><header>Application of allocated credit amount</header><subparagraph id="idEE80CD25F55241F8B1959DCD7A45C14A"><enum>(A)</enum><header> Amount available to taxpayer for all months in credit period</header><text>Any rental reduction credit amount allocated to any qualified building out of the State rental reduction credit ceiling for any calendar year shall apply to such building for all months in the credit period ending during or after such calendar year. </text></subparagraph><subparagraph id="id6131D6BAF461470F9E6DAC43D0D56854"><enum>(B)</enum><header>Ceiling for allocation year reduced by entire credit amount</header><text>Any rental reduction credit amount allocated to any qualified building out of an allocating agency's State rental reduction credit ceiling for any calendar year shall reduce such ceiling for such calendar year by the entire amount so allocated for all months in the credit period (as determined on the basis of the estimates under paragraph (2)(B)) and no reduction shall be made in such agency's State rental reduction credit ceiling for any subsequent calendar year by reason of such allocation.</text></subparagraph></paragraph><paragraph id="idD0DCFA2700C3411585FBEF9E4253A90E"><enum>(4)</enum><header>State rental reduction credit ceiling</header><subparagraph id="idAD2C7D99E8E74FDEB6B37F85647A5291"><enum>(A)</enum><header>In general</header><text>The State rental reduction credit ceiling applicable to any State for any calendar year shall be an amount equal to the sum of—</text><clause id="idA3EA450617F04E65A22854882C362B0B"><enum>(i)</enum><text>the greater of—</text><subclause id="id103BB3EF37C6461882B83AE9BE4C35F7"><enum>(I)</enum><text>the per capita dollar amount multiplied by the State population, or</text></subclause><subclause id="idEE4D70713D3B4965A957E92A3F4036F7"><enum>(II)</enum><text>the minimum ceiling amount, plus</text></subclause></clause><clause id="idD7138876FAAA450BA036F49E20CDE40B"><enum>(ii)</enum><text>the amount of the State rental reduction credit ceiling returned in the calendar year.</text></clause></subparagraph><subparagraph id="id4BDBFFF612C54E98975DDEDE8EBDF242"><enum>(B)</enum><header>Return of State ceiling amounts</header><text>For purposes of subparagraph (A)(ii), except as provided in subsection (d)(2), the amount of the State rental reduction credit ceiling returned in a calendar year equals the amount of the rental reduction credit amount allocated to any building which, after the close of the calendar year for which the allocation is made—</text><clause id="id7086BDEA8FC847DBB12BC8E33B8BE762"><enum>(i)</enum><text>is canceled by mutual consent of the rental reduction credit agency and the taxpayer because the estimates made under paragraph (2)(B) were substantially incorrect, or</text></clause><clause id="id5F3A8C41EFE74B839A529A6F04003421"><enum>(ii)</enum><text>is canceled by the rental reduction credit agency because the taxpayer violates the qualified rental reduction agreement and, under the terms of the agreement, the rental reduction credit agency is authorized to cancel all (or any portion) of the allocation by reason of the violation.</text></clause></subparagraph><subparagraph id="id5658C02DA8DC499CAF2AF9C77D8B47FA"><enum>(C)</enum><header>Per capita dollar amount; minimum ceiling amount</header><text>For purposes of this paragraph—</text><clause id="idB2E6F7943F6D4330841CE419EC0719EC"><enum>(i)</enum><header>Per capita dollar amount</header><text>The per capita dollar amount is—</text><subclause id="idB9CACF62EEE34BB391592532DB8EBF9C"><enum>(I)</enum><text>for calendar year 2021, $12.30,</text></subclause><subclause id="idEB0F3601935644F4B2208D2EFD0B4882"><enum>(II)</enum><text>for calendar year 2022, $24.50, and</text></subclause><subclause id="idE0B94A20B9B846278DA73660C98AD19B"><enum>(III)</enum><text>for calendar years 2023 and thereafter, $36.75.</text></subclause></clause><clause id="idBB233B5D61F1469298A75F3B2AE98FB0"><enum>(ii)</enum><header>Minimum ceiling amount</header><text>The minimum ceiling amount is—</text><subclause id="id9C228E7F1F9544E382B62A6681234512"><enum>(I)</enum><text>for calendar year 2021, $14,000,000,</text></subclause><subclause id="idCC3A94728D7047B2AB64034A109543AB"><enum>(II)</enum><text>for calendar year 2022, $28,000,000, and</text></subclause><subclause id="idAA57D43616D043C9956A0E00ADE7C76E"><enum>(III)</enum><text>for calendar years 2023 and thereafter, $42,000,000.</text></subclause></clause><clause id="id356219ccc24d46b5b97a5a7dd855864c"><enum>(iii)</enum><header>Cost-of-living adjustment</header><text>In the case of a calendar year beginning after 2023, the $36.75 and $42,000,000 amounts in clauses (i)(III) and (ii)(III) shall each be increased by an amount equal to— </text><subclause id="id021BC287D63F48A4A49D999A716D0976"><enum>(I)</enum><text>such dollar amount, multiplied by </text></subclause><subclause id="idf1a91d5234154f4d9c7d4c67fe6c42d9"><enum>(II)</enum><text>the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting <quote>calendar year 2022</quote> for <quote>calendar year 2016</quote> in subparagraph (A)(ii) thereof.</text></subclause><continuation-text continuation-text-level="clause">In the case of the $42,000,000 amount, any increase under this clause which is not a multiple of $5,000 shall be rounded to the next lowest multiple of $5,000 and in the case of the $36.75 amount, any increase under this clause which is not a multiple of 5 cents shall be rounded to the next lowest multiple of 5 cents.</continuation-text></clause></subparagraph><subparagraph commented="no" display-inline="no-display-inline" id="id8B673CBAB9694D3B8E045CA6F36E46B2"><enum>(D)</enum><header display-inline="yes-display-inline">Population</header><text display-inline="yes-display-inline">For purposes of this paragraph, population shall be determined in accordance with section 146(j).</text></subparagraph><subparagraph id="P942EFED8F7C7469AA02B27D1F2C2D454"><enum>(E)</enum><header>Unused rental reduction credit allocated among certain States</header><clause id="P411973297EB54990B604EAADA1100114"><enum>(i)</enum><header>In general</header><text>The unused rental reduction credit of a State for any calendar year shall be assigned to the Secretary for allocation among qualified States for the succeeding calendar year.</text></clause><clause id="PB8DA87A69F1C4734A6C5AFE06D506608"><enum>(ii)</enum><header>Unused rental reduction credit</header><text>For purposes of this subparagraph, the unused rental reduction credit of a State for any calendar year is the excess (if any) of—</text><subclause id="PB809B188489146DC88BC0B2CEA457F60"><enum>(I)</enum><text>the State rental reduction credit ceiling for the year preceding such year, over</text></subclause><subclause id="P263DD5F4403243CA9D795CE9A2BCE45F"><enum>(II)</enum><text>the aggregate rental reduction credit amounts allocated for such year.</text></subclause></clause><clause id="P7A3BFC7458824F30B7B426A463DB8221"><enum>(iii)</enum><header>Formula for allocation of unused credit among qualified States</header><text>The amount allocated under this subparagraph to a qualified State for any calendar year shall be the amount determined by the Secretary to bear the same ratio to the aggregate unused rental reduction credits of all States for the preceding calendar year as such State's population for the calendar year bears to the population of all qualified States for the calendar year. For purposes of the preceding sentence, population shall be determined in accordance with section 146(j).</text></clause><clause id="P2F59A522FE9E402AB869ACF1A93F342E"><enum>(iv)</enum><header>Qualified State</header><text>For purposes of this subparagraph, the term <term>qualified State</term> means, with respect to a calendar year, any State—</text><subclause id="PE1BD06AB692648AA8CEF2CA39F1AA533"><enum>(I)</enum><text>which allocated its entire State rental reduction credit ceiling for the preceding calendar year, and</text></subclause><subclause id="P6AD4BCA130484A6CB2072808B6EC7EDF"><enum>(II)</enum><text>for which a request is made (at such time and in such manner as the Secretary may prescribe) to receive an allocation under clause (iii).</text></subclause></clause></subparagraph></paragraph><paragraph id="id5FD9945C607E4349860EDCCD0AE947CA"><enum>(5)</enum><header>Other definitions</header><text>For purposes of this section—</text><subparagraph id="idDAB6E2AE72E642A2B28D335FE1A46284"><enum>(A)</enum><header>Rental reduction credit agency</header><text>The term <term>rental reduction credit agency</term> means any agency authorized by a State to carry out this section. Such authorization shall include the jurisdictions within the State where the agency may allocate rental reduction credit amounts.</text></subparagraph><subparagraph id="id738B1AF92E1C44248C8329CFE45F8D7C"><enum>(B)</enum><header>Possessions treated as States</header><text>The term <term>State</term> includes a possession of the United States.</text></subparagraph><subparagraph id="id8211444D76064AC0B9A5FF5C2C967183"><enum>(C)</enum><header>Family</header><text>The term <term>family</term> has the same meaning as when used in the United States Housing Act of 1937.</text></subparagraph></paragraph></subsection><subsection id="id7BB3C22CBCEF4CD4882CB4F4A684A5F5"><enum>(d)</enum><header>Modifications To correct inaccurate amounts due to incorrect estimates</header><paragraph id="id31CCD806D8A3496B8B3066362648CFA3"><enum>(1)</enum><header>Establishment of reserves</header><subparagraph id="id7C04A26FAD36475D8A768BD1D53B42DC"><enum>(A)</enum><header>In general</header><text>Each rental reduction credit agency of a State shall establish a reserve for the transfer and reallocation of amounts pursuant to this paragraph, and notwithstanding any other provision of this section, the rental reduction credit amount allocated to any building by such agency shall be zero unless such agency has in effect such a reserve at the time of the allocation of such credit amount.</text></subparagraph><subparagraph id="id2B3CA3EFCEFB4D7799BFB39FD11DAE5A"><enum>(B)</enum><header>Transfers to reserve</header><clause id="idF96904912D82459B8C550BDCDDC9AF1A"><enum>(i)</enum><header>In general</header><text>If, for any taxable year, a taxpayer would (but for this subparagraph) not be able to use the entire rental reduction credit amount allocated to a qualified building by a rental reduction credit agency of a State for the taxable year because of a rental reduction shortfall, then the taxpayer shall for the taxable year transfer to the reserve established by such agency under subparagraph (A) an amount equal to such rental reduction shortfall.</text></clause><clause id="idB0039A14B7D446BCB1A3D2D2E36A923E"><enum>(ii)</enum><header>Rental reduction shortfall</header><text>For purposes of this subparagraph, the rental reduction shortfall for any qualified building for any taxable year is the amount by which the aggregate amount of the excesses determined under subsection (b)(1) for all eligible units within such building are less than such aggregate amount estimated under subsection (c)(2)(B) for the taxable year.</text></clause><clause id="id792F2A9B57EC43ADA4853E3661B35127"><enum>(iii)</enum><header>Treatment of transferred amount</header><text>For purposes of subsection (a)(2)(A), the aggregate qualified rental reduction amounts for all eligible units within a qualified building with respect to which clause (i) applies for any taxable year shall be increased by an amount equal to the applicable percentage (determined under subsection (e)(1) for the building) of the amount of the transfer to the reserve under clause (i) with respect to such building for such taxable year.</text></clause></subparagraph><subparagraph id="id015E05405CE04C95B05D0A1F135CAE34"><enum>(C)</enum><header>Reallocation of amounts transferred</header><clause id="id69A64BDD5A3A4499A4187CEE144AF359"><enum>(i)</enum><header>In general</header><text>If, for any taxable year—</text><subclause id="idEF7F5843F93F4CB28B8837702A4D4EE2"><enum>(I)</enum><text>the aggregate qualified rental reduction amounts for all eligible units within a qualified building for the taxable year, exceed</text></subclause><subclause id="id8A128106896F48618F65DBFB5E6CAD7E"><enum>(II)</enum><text>the rental reduction credit amount allocated to such building by a rental reduction credit agency of a State for the taxable year (determined after any increase under paragraph (2)),</text></subclause><continuation-text continuation-text-level="clause">the rental reduction credit agency shall, upon application of the taxpayer, pay to the taxpayer from the reserve established by such agency under subparagraph (A) the amount which, when multiplied by the applicable percentage (determined under subsection (e)(1) for the building), equals such excess. If the amount in the reserve is less than the amounts requested by all taxpayers for taxable years ending within the same calendar year, the agency shall ratably reduce the amount of each payment otherwise required to be made.</continuation-text></clause><clause id="id6A02E30E79DD404BB910D15FB6065B50"><enum>(ii)</enum><header>Excess reserve amounts</header><text>If a rental reduction credit agency of a State determines that the balance in its reserve is in excess of the amounts reasonably needed over the following 5 calendar years to make payments under clause (i), the agency may withdraw such excess but only to—</text><subclause id="idf6d264045a034a24b2db0d05be1bc18d"><enum>(I)</enum><text>reduce the rental payments of eligible tenants in a qualified building in units other than eligible units, or of eligible tenants in units in a building other than a qualified building, to amounts no higher than the sum of rental payments required for eligible tenants in qualified buildings under subsection (b)(3) and any rental charges to such tenants in excess of the market rent standard; or</text></subclause><subclause id="ida5aebfd2ec35411b8a6518dcbcd453a1"><enum>(II)</enum><text>address maintenance and repair needs in qualified buildings that cannot reasonably be met using other resources available to the owners of such buildings.</text></subclause></clause></subparagraph><subparagraph id="idA424CF954FCC41CD9161EF3E2482FD6B"><enum>(D)</enum><header>Administration</header><text>Each rental reduction credit agency of a State shall establish procedures for the timing and manner of transfers and payments made under this paragraph.</text></subparagraph><subparagraph id="idBF4BFC51AA6943FD8DCEAD73905C15DF"><enum>(E)</enum><header>Special rule for projects</header><text>In the case of a rental reduction credit allocated to a project consisting of more than 1 qualified building, a taxpayer may elect to have this paragraph apply as if all such buildings were 1 qualified building if the applicable percentage for each such building is the same.</text></subparagraph><subparagraph id="id2152915B0F5649ABBA3A58B25C5B79CA"><enum>(F)</enum><header>Alternative methods of transfer and reallocation</header><text>Upon request to, and approval by, the Secretary, a State may establish an alternative method for the transfer and reallocation of amounts otherwise required to be transferred to, and allocated from, a reserve under this paragraph. Any State adopting an alternative method under this subparagraph shall, at such time and in such manner as the Secretary prescribes, provide to the Secretary and the Secretary of Housing and Urban Development detailed reports on the operation of such method, including providing such information as such Secretaries may require.</text></subparagraph></paragraph><paragraph id="idA16C3B63B92D44ECBE352C76CCE6C8AD"><enum>(2)</enum><header>Allocation of returned State ceiling amounts</header><text>In the case of any rental reduction credit amount allocated to a qualified building which is canceled as provided in subsection (c)(4)(B)(i), the rental reduction credit agency may, in lieu of treating such allocation as a returned credit amount under subsection (c)(4)(A)(ii), elect to allocate, upon the request of the taxpayer, such amount to any other qualified building for which the credit amount allocated in any preceding calendar year was too small because the estimates made under subsection (c)(2)(B) were substantially incorrect.</text></paragraph><paragraph id="id3D79D18DE167436A85ABCCDC7C429C22"><enum>(3)</enum><header>Renting to noneligible tenants</header><text>If, after the application of paragraphs (1)(C) (or any similar reallocation under paragraph (1)(F)) and (2), a rental reduction credit agency of a State determines that, because of the incorrect estimates under subsection (c)(2)(B), the aggregate qualified rental reduction amounts for all eligible units within a qualified building will (on an ongoing basis) exceed the rental reduction credit amount allocated to such building, a taxpayer may elect, subject to subsection (g)(2) and only to the extent necessary to eliminate such excess, rent vacant eligible units without regard to the requirements that such units be rented only to eligible tenants and at the rental rate determined under subsection (b)(3).</text></paragraph></subsection><subsection id="idAA1AB0DAB775431CBA912C71AEB87233"><enum>(e)</enum><header>Terms relating to rental reduction credit and requirements</header><text>For purposes of this section—</text><paragraph id="idB860645AA3E84227875854CE69EB6D1A"><enum>(1)</enum><header>Applicable percentage</header><subparagraph id="idB39BA3D4A1394141923B1179A0EB3C16"><enum>(A)</enum><header>In general</header><text>The term <term>applicable percentage</term> means, with respect to any qualified building, the percentage (not greater than 110 percent) set by the rental reduction credit agency at the time it allocates the rental reduction dollar amount to such building.</text></subparagraph><subparagraph id="idCDF67781F2A248B2BF0390A1578BF57A"><enum>(B)</enum><header>Higher percentage for high-opportunity areas</header><text>The rental reduction credit agency may set a percentage under subparagraph (A) up to 120 percent for any qualified building which— </text><clause id="idE608212F53C047428FD3C5AE96A6007F"><enum>(i)</enum><text>targets its eligible units for rental to families with children, and</text></clause><clause id="id78636E157EB5446494F53A66539C61C6"><enum>(ii)</enum><text>is located in a neighborhood which has a poverty rate of no more than 10 percent. </text></clause></subparagraph></paragraph><paragraph id="idA143A0A8E5CF4D6B9BADD52BFC240B97"><enum>(2)</enum><header>Credit period</header><subparagraph id="id59992D22ACDD4EF7825BA54BE0323373"><enum>(A)</enum><header>In general</header><text>The term <term>credit period</term> means, with respect to any qualified building, the 15-year period beginning with the first month for which the qualified rental reduction agreement is in effect with respect to such building.</text></subparagraph><subparagraph id="idFFBA1636BE564DA983452816835CD72C"><enum>(B)</enum><header>State option to reduce period</header><text>A rental reduction credit agency may provide a credit period for any qualified building which is less than 15 years. </text></subparagraph></paragraph><paragraph id="idCD49F24E95344E4E99E49F69A8600118"><enum>(3)</enum><header>Eligible unit</header><subparagraph id="id44A07EB8CA824ABF86959C52402A7966"><enum>(A)</enum><header>In general</header><text>The term <term>eligible unit</term> means, with respect to any qualified building, a unit—</text><clause id="id593112AEEB334D44B9E68F356787C387"><enum>(i)</enum><text>which is occupied by an eligible tenant,</text></clause><clause id="id64B8E7B9B3E94480B6A5A1F1E20B4A9D"><enum>(ii)</enum><text>the rent of which for any month equals 30 percent of the monthly family income of the residents of such unit (as determined under paragraph (5)),</text></clause><clause id="id83E7D0A2BEF84F3A8BDF8A5DB6E34E11"><enum>(iii)</enum><text>with respect to which the tenant is not concurrently receiving rental assistance under any other Federal program, and</text></clause><clause id="id97AE0513865A43288D34871177857549"><enum>(iv)</enum><text>which is certified to the rental reduction credit agency as an eligible unit for purposes of this section and the qualified rental reduction agreement.</text></clause><continuation-text continuation-text-level="subparagraph">Notwithstanding clause (iii), a State may provide in its State rental reduction allocation plan that an eligible unit shall also not include a unit with respect to which any resident is receiving rental assistance under a State or local program.</continuation-text></subparagraph><subparagraph id="id1C62F1DACA4941898F9C31D190BC8FC1"><enum>(B)</enum><header>Limitation on number of units</header><clause id="id9B5A338D78234E4780797BF2761338A2"><enum>(i)</enum><header>In general</header><text>The number of units which may be certified as eligible units with respect to any qualified building under subparagraph (A)(iv) at any time shall not exceed the greater of—</text><subclause id="id14CC57ABA31E484A90D4E8AD67780A3A"><enum>(I)</enum><text>40 percent of the total units in such building, or</text></subclause><subclause id="id0EB3BBF8378243D1914C3C1CAE42BA90"><enum>(II)</enum><text>25 units.</text></subclause><continuation-text continuation-text-level="clause">In the case of an allocation to a project under subsection (c)(1)(B), the limitation under the preceding sentence shall be applied on a project basis and the certification of such eligible units shall be allocated to each building in the project, except that if buildings in such project are on non-contiguous tracts of land, buildings on each such tract shall be treated as a separate project for purposes of applying this sentence.</continuation-text></clause><clause id="id5B769464E37B43E88C488D6EB9B7CB58"><enum>(ii)</enum><header>Buildings receiving previous Federal rental assistance</header><text>If, at any time prior to the entering into of a qualified rental reduction agreement with respect to a qualified building, tenants in units within such building had been receiving project-based rental assistance under any other Federal program, then, notwithstanding clause (i), the maximum number of units which may be certified as eligible units with respect to the building under subparagraph (A)(iv) shall not be less than the sum of—</text><subclause id="id2EC867D3A1BB47F19A57562AFE2C23B4"><enum>(I)</enum><text>the maximum number of units in the building previously receiving such assistance at any time before the agreement takes effect, plus</text></subclause><subclause id="idC7765AE823654C41B7FC34814C1F50E3"><enum>(II)</enum><text>the amount determined under clause (i) without taking into account the units described in subclause (I).</text></subclause></clause></subparagraph></paragraph><paragraph id="id322CC267E4834BAEBA0A819A2F0E18DC"><enum>(4)</enum><header>Eligible tenant</header><subparagraph id="idE79A2B27ACDB4AAF8DC15D65F41AA631"><enum>(A)</enum><header>In general</header><text>The term <term>eligible tenant</term> means any individual if the individual's family income does not exceed the greater of—</text><clause id="id81FC1451AF944FA6B8FEA115D593D4BD"><enum>(i)</enum><text>30 percent of the area median gross income (as determined under section 42(g)(1)), or</text></clause><clause id="idAFE16FF6860745C5BFFE69C936EF4DB4"><enum>(ii)</enum><text>the applicable poverty line for a family of the size involved.</text></clause></subparagraph><subparagraph id="id30F2AB96DD2A45E5B86F4F6F0F859362"><enum>(B)</enum><header>Treatment of individuals whose incomes rise above limit</header><clause id="id70BCC48205D94AE880DD119924A01135"><enum>(i)</enum><header>In general</header><text>Notwithstanding an increase in the family income of residents of a unit above the income limitation applicable under subparagraph (A), such residents shall continue to be treated as eligible tenants if the family income of such residents initially met such income limitation and such unit continues to be certified as an eligible unit under this section.</text></clause><clause id="id5C1464DADB7645D7B211595149D78C05"><enum>(ii)</enum><header>No rental reduction for at least 2 years</header><text>A qualified rental reduction agreement with respect to a qualified building shall provide that if, by reason of an increase in family income described in clause (i), there is no qualified rental reduction amount with respect to the dwelling unit for 2 consecutive years, the taxpayer shall rent the next available unit to an eligible tenant (without regard to whether such unit is an eligible unit under this section).</text></clause></subparagraph><subparagraph id="id89092CC8CD084E40954E4CB7A3FA0191"><enum>(C)</enum><header>Applicable poverty line</header><text>The term <term>applicable poverty line</term> means the most recently published poverty line (within the meaning of section 2110(c)(5) of the Social Security Act (<external-xref legal-doc="usc" parsable-cite="usc/42/1397jj">42 U.S.C. 1397jj(c)(5)</external-xref>)) as of the time of the determination as to whether an individual is an eligible tenant.</text></subparagraph></paragraph><paragraph id="idA146E53F953A4559BE7659AD3A9188A8"><enum>(5)</enum><header>Family income</header><subparagraph id="idE066EACE7C744CBAB21E41DDCDEDC0F8"><enum>(A)</enum><header>In general</header><text>Family income shall be determined in the same manner as under section 8 of the United States Housing Act of 1937.</text></subparagraph><subparagraph id="id0BFDA8CE7BF9495AA092D76C59339F23"><enum>(B)</enum><header>Time for determining income</header><clause id="idC8196E6A0F774A2AA833E727C617EF0A"><enum>(i)</enum><header>In general</header><text>Except as provided in this subparagraph, family income shall be determined at least annually on the basis of income for the preceding calendar year.</text></clause><clause id="id9069EF4422D0426C9C49413276D82306"><enum>(ii)</enum><header>Families on fixed income</header><text>If at least 90 percent of the family income of the residents of a unit at the time of any determination under clause (i) is derived from payments under title II or XVI of the Social Security Act (or any similar fixed income amounts specified by the Secretary), the taxpayer may elect to treat such payments (or amounts) as the family income of such residents for the year of the determination and the 2 succeeding years, except that the taxpayer shall, in such manner as the Secretary may prescribe, adjust such amount for increases in the cost of living.</text></clause><clause id="id81C6B0EF12D844C1823570B230E250F5"><enum>(iii)</enum><header>Initial income</header><text>The Secretary may allow a State to provide that the family income of residents at the time such residents first rent a unit in a qualified building may be determined on the basis of current or anticipated income.</text></clause><clause id="id84C0C2D901E444508A7E6679A0FDD428"><enum>(iv)</enum><header>Special rules where family income is reduced</header><text>If residents of a unit establish (in such manner as the rental reduction credit agency provides) that their family income has been reduced by at least 10 percent below such income for the determination year—</text><subclause id="idB4FCB0AE690C48D3B818307B8C3BD8A8"><enum>(I)</enum><text>such residents may elect, at such time and in such manner as such agency may prescribe, to have their family income redetermined, and</text></subclause><subclause id="id1D85CE33F8D44BEFB504477A879E372C"><enum>(II)</enum><text>clause (ii) shall not apply to any of the 2 succeeding years described in such clause which are specified in the election.</text></subclause></clause></subparagraph></paragraph></subsection><subsection id="id6E50183BB5374817B6F4C63101C44B54"><enum>(f)</enum><header>State rental reduction allocation plan</header><paragraph id="id7BF814D3F2544FF28CC7CD127D809442"><enum>(1)</enum><header>Adoption of plan required</header><subparagraph id="idEEBCE057011841DCBF1EFC049532A936"><enum>(A)</enum><header>In general</header><text>For purposes of this section—</text><clause id="idEAC3CBA4F75B4A30ABDE57DA3F201826"><enum>(i)</enum><text>each State shall, before the allocation of its State rental reduction credit ceiling, establish and have in effect a State rental reduction allocation plan, and</text></clause><clause id="id280D08CD7ABA465D853491512A16981D"><enum>(ii)</enum><text>notwithstanding any other provision of this section, the rental reduction credit amount allocated to any building shall be zero unless such amount was allocated pursuant to a State rental reduction allocation plan.</text></clause><continuation-text continuation-text-level="subparagraph">Such plan shall only be adopted after such plan is made public and at least 60 days has been allowed for public comment.</continuation-text></subparagraph><subparagraph id="id65F2D9BF75BE4A75BB95BFD11E92193F"><enum>(B)</enum><header>State rental reduction allocation plan</header><text>For purposes of this section, the term <term>State rental reduction allocation plan</term> means, with respect to any State, any plan of the State meeting the requirements of paragraphs (2) and (3).</text></subparagraph></paragraph><paragraph id="id478AA60E32B3408A8FC8A3FE90C96C17"><enum>(2)</enum><header>General plan requirements</header><text>A plan shall meet the requirements of this paragraph only if—</text><subparagraph id="id3FE1F3E851A24185905052E00E40882D"><enum>(A)</enum><text>the plan sets forth the criteria and priorities which a rental reduction credit agency of the State shall use in allocating the State rental reduction credit ceiling to eligible units within a building,</text></subparagraph><subparagraph id="idEE60AA2913E14B9C88243C2A61C36A12"><enum>(B)</enum><text>the plan provides that no credit allocation shall be made which is not in accordance with the criteria and priorities set forth under subparagraph (A) unless such agency provides a written explanation to the general public for any credit allocation which is not so made and the reasons why such allocation is necessary, and</text></subparagraph><subparagraph id="idFF7B6EA6380D47748ED4F4AC5D6871DF"><enum>(C)</enum><text>the plan provides that such agency is required to prioritize the renewal of existing credit allocations at the time of the expiration of the qualified rental reduction agreement with respect to the allocation, including, where appropriate, a commitment within a qualified rental reduction agreement that the credit allocation will be renewed if the terms of the agreement have been met and sufficient new credit authority is available.</text></subparagraph></paragraph><paragraph id="idE59260E4659F4BEC877AD6EEAE242DD1"><enum>(3)</enum><header>Specific requirements</header><text>A plan shall meet the requirements of this paragraph only if—</text><subparagraph id="id6CF56B74CA424179AC82DD58AA2ACC9F"><enum>(A)</enum><text>the plan provides methods for determining—</text><clause id="idD915A52EA63A49ED8C9C993D409ADD56"><enum>(i)</enum><text>the amount of rent which would be charged for a substantially similar unit in the same building which is not an eligible unit for purposes of subsection (b)(2)(A)(i), including whether such determination may be made by self-certification or by undertaking rent reasonableness assessments similar to assessments required under section 8(o)(10) of the United States Housing Act of 1937 (<external-xref legal-doc="usc" parsable-cite="usc/42/1437f">42 U.S.C. 1437f(o)(10)</external-xref>),</text></clause><clause id="id2384D7FB27DB438CB0BDD4B4873A9E86"><enum>(ii)</enum><text>the qualified rental reduction amounts under subsection (c)(2)(B), and</text></clause><clause id="id9637D302C08B44C6A1336B4371D8A241"><enum>(iii)</enum><text>the applicable percentage under subsection (e)(1),</text></clause></subparagraph><subparagraph id="id1E24FC28BE4D44F88C5F38ADC0F81B71"><enum>(B)</enum><text>the plan provides a procedure that the rental reduction credit agency (or an agent or other private contractor of such agency) will follow in monitoring for—</text><clause id="id07F9FE83654D43348E12E488D2C77D49"><enum>(i)</enum><text>noncompliance with the provisions of this section and the qualified rental reduction agreement and in notifying the Internal Revenue Service of any such noncompliance of which such agency becomes aware, and</text></clause><clause id="id25AE2F2F0A8A4A308BBCE72577808C38"><enum>(ii)</enum><text>noncompliance with habitability standards through regular site visits,</text></clause></subparagraph><subparagraph id="id91B95184A474474FB0713069382A40F2"><enum>(C)</enum><text>the plan requires a person receiving a credit allocation to report to the rental reduction credit agency such information as is necessary to ensure compliance with the provisions of this section and the qualified rental reduction agreement, and</text></subparagraph><subparagraph id="id3BB23BD73730433D9C788C036FD5A1C3"><enum>(D)</enum><text>the plan provides methods by which any excess reserve amounts which become available under subsection (d)(1)(C)(ii) will be used to reduce rental payments of eligible tenants or to address maintenance and repair needs in qualified buildings, including how such assistance will be allocated among eligible tenants and qualified buildings.</text></subparagraph></paragraph></subsection><subsection id="id2F8564AEE56E46FC949662F92F800128"><enum>(g)</enum><header>Qualified rental reduction agreement</header><text>For purposes of this section—</text><paragraph id="idCE570DACAB3040C28FD98B2F4C061763"><enum>(1)</enum><header>In general</header><text>The term <term>qualified rental reduction agreement</term> means, with respect to any building which is residential rental property (as defined in section 168(e)(2)(A)), a written, binding agreement between a rental reduction credit agency and the taxpayer which specifies—</text><subparagraph id="id7A7E8B87504744A78F1AD2204E75B551"><enum>(A)</enum><text>the number of eligible units within such building for which a rental reduction credit amount is being allocated,</text></subparagraph><subparagraph id="id489004C3532D4EE1BBAB37C1D06D9652"><enum>(B)</enum><text>the credit period for such building,</text></subparagraph><subparagraph id="id92BF217B16FC40A7926E3942C1A49C44"><enum>(C)</enum><text>the rental reduction credit amount allocated to such building (and dwelling units within such building) and the portion of such amount allocated to each month within the credit period under subsection (c)(2)(B),</text></subparagraph><subparagraph id="id60EE47E6D0F44A23BA3BB6E9A8E4A261"><enum>(D)</enum><text>the applicable percentage to be used in computing the qualified rental reduction amounts with respect to the building,</text></subparagraph><subparagraph id="id17110DFA8AC24640B89B39335F641E3C"><enum>(E)</enum><text>the method for determining the amount of rent which may be charged for eligible units within the building, and</text></subparagraph><subparagraph id="id29E333D362DF432785C00CBD9177D46E"><enum>(F)</enum><text> whether—</text><clause id="id7D38170A6F664A6BBF1D75067C86939A"><enum>(i)</enum><text>the agency commits to entering into a new agreement with the taxpayer if the terms of the agreement have been met and sufficient new credit authority is available for such new agreement, and</text></clause><clause id="id8F19F1C55DD14561B01ABD523900061C"><enum>(ii)</enum><text>the taxpayer is required to accept such new agreement. </text></clause></subparagraph></paragraph><paragraph id="idA626133C07734D3AAE34697734BD864B"><enum>(2)</enum><header>Tenant protections</header><text>A qualified rental reduction agreement shall provide the following:</text><subparagraph id="id920504C9B5DC457391E5991F7B1728DC"><enum>(A)</enum><header>Non-displacement of non-eligible tenants</header><text>A taxpayer receiving a rental reduction credit amount may not refuse to renew the lease of or evict (other than for good cause) a tenant of a unit who is not an eligible tenant at any time during the credit period and such unit shall not be treated as an eligible unit while such tenant resides there.</text></subparagraph><subparagraph id="idCEC8E18B67464981B91E90F6DB437500"><enum>(B)</enum><header>Only good cause evictions of eligible tenants</header><text>A taxpayer receiving a rental reduction credit amount may not refuse to renew the lease of or evict (other than for good cause) an eligible tenant of an eligible unit.</text></subparagraph><subparagraph id="idA5A5316652044CD296CCCAEEF7A5C180"><enum>(C)</enum><header>Mobility</header><text>A taxpayer receiving a rental reduction credit amount shall—</text><clause id="idE14CBF9223C346AABE82A1541D1BD3A4"><enum>(i)</enum><text>give priority to rent any available unit of suitable size to tenants who are eligible tenants who are moving from another qualified building where such tenants had lived at least 1 year and were in good standing, and</text></clause><clause id="idC3F518FB0B5C4D2EA765F0488457F1F3"><enum>(ii)</enum><text>inform eligible tenants within the building of their right to move after 1 year and provide a list maintained by the State of qualified buildings where such tenants might move.</text></clause><clause id="id8F9EAE36D3D74E2BB005FB6BEEBB0F9B"><enum>(iii)</enum><header>Fair housing and civil rights</header><text>If a taxpayer receives a rental reduction credit amount—</text><subclause id="id9299F73351F54EF9833CBDF0640AACFC"><enum>(I)</enum><text>such taxpayer shall comply with the Fair Housing Act with respect to the building, and</text></subclause><subclause id="idE7F888962FFD4585AFAAB13B5781CE1F"><enum>(II)</enum><text>the receipt of such amount shall be treated as the receipt of Federal financial assistance for purposes of applying any Federal civil rights laws.</text></subclause></clause><clause id="idBCD02DEF2C2C4972B49B802B16D19376"><enum>(iv)</enum><header>Admissions preferences</header><text>A taxpayer receiving a rental reduction credit amount shall comply with any admissions preferences established by the State for tenants within particular demographic groups eligible for health or social services.</text></clause></subparagraph></paragraph><paragraph id="id9E059EFB140D4EEF9D3043C8392D07D6"><enum>(3)</enum><header>Compliance requirements</header><text>A qualified rental reduction agreement shall provide that a taxpayer receiving a rental reduction credit amount shall comply with all reporting and other procedures established by the State to ensure compliance with this section and such agreement.</text></paragraph><paragraph id="id974B0F2772FA4627908337D291D80871"><enum>(4)</enum><header>Projects</header><text>In the case of a rental reduction credit allocated to a project consisting of more than 1 building, the rental reduction credit agency may provide for a single qualified rental reduction agreement which applies to all buildings which are part of such project.</text></paragraph></subsection><subsection id="id412E7E1F1827430EB4C1144A66D2DB4F"><enum>(h)</enum><header>Certifications and other reports to Secretary</header><paragraph id="id00DD560D211149B099725B1D1FB561B1"><enum>(1)</enum><header>Certification with respect to 1st year of credit period</header><text>Following the close of the 1st taxable year in the credit period with respect to any qualified building, the taxpayer shall certify to the Secretary (at such time and in such form and in such manner as the Secretary prescribes)—</text><subparagraph id="idAC39227CBD7E464EBDF94C5159114F60"><enum>(A)</enum><text>the information described in subsection (g)(1) required to be contained in the qualified rental reduction agreement with respect to the building, and</text></subparagraph><subparagraph id="id07EA0942AB874CC0A0FFD803CF4D1646"><enum>(B)</enum><text>such other information as the Secretary may require.</text></subparagraph><continuation-text continuation-text-level="paragraph">In the case of a failure to make the certification required by the preceding sentence on the date prescribed therefor, unless it is shown that such failure is due to reasonable cause and not to willful neglect, no credit shall be allowable by reason of subsection (a) with respect to such building for any taxable year ending before such certification is made.</continuation-text></paragraph><paragraph id="id0A3B7FC5F25640278A47FAF7BF1F5404"><enum>(2)</enum><header>Annual reports to the Secretary</header><text>The Secretary may require taxpayers to submit an information return (at such time and in such form and manner as the Secretary prescribes) for each taxable year setting forth—</text><subparagraph id="idA06D5939FCF442D59CBF60C7B73AA228"><enum>(A)</enum><text>the information described in paragraph (1)(A) for the taxable year, and</text></subparagraph><subparagraph id="idCDA6697A2827462791B03D6B544ED07C"><enum>(B)</enum><text>such other information as the Secretary may require.</text></subparagraph><continuation-text continuation-text-level="paragraph">The penalty under section 6652(j) shall apply to any failure to submit the return required by the Secretary under the preceding sentence on the date prescribed therefor.</continuation-text></paragraph><paragraph id="id29ADF1AFDEE844EEA55618F11414E29D"><enum>(3)</enum><header>Annual reports from rental reduction credit agency</header><subparagraph id="id2D33732005064D2CB2D892E84D6B269E"><enum>(A)</enum><header>Reports</header><text>Each rental reduction credit agency which allocates any rental reduction credit amount to 1 or more buildings for any calendar year shall submit to the Secretary (at such time and in such manner as the Secretary shall prescribe) an annual report specifying—</text><clause id="id06E9FC958BF1408DADE1F69DF35E7726"><enum>(i)</enum><text>the amount of rental reduction credit amounts allocated to each such building for such year,</text></clause><clause id="id1C51F86DFB7746238A3B13449DC89813"><enum>(ii)</enum><text>sufficient information to identify each such building and the taxpayer with respect thereto,</text></clause><clause id="idEB2B22E2FCD54E068E39DB3EEB4BF239"><enum>(iii)</enum><text>information as to the demographic and income characteristics of eligible tenants of all such buildings to which such amounts were allocated, and</text></clause><clause id="idCF4F29D9C79D47CB8E02BEA0131FE4EF"><enum>(iv)</enum><text>such other information as the Secretary may require.</text></clause></subparagraph><subparagraph id="id7812EF0FB7DE4F7D96B339E9AA99CB1B"><enum>(B)</enum><header>Penalty</header><text>The penalty under section 6652(j) shall apply to any failure to submit the report required by subparagraph (A) on the date prescribed therefor.</text></subparagraph><subparagraph id="id356CAE033B2D424DA1494185EE58CA15"><enum>(C)</enum><header>Information made public</header><text>The Secretary shall, in consultation with Secretary of Housing and Urban Development, make information reported under this paragraph for each qualified building available to the public annually to the greatest degree possible without disclosing personal information about individual tenants.</text></subparagraph></paragraph></subsection><subsection id="idd94252a7c01f484c8fd4e1c133c270ff"><enum>(i)</enum><header>Special rule for payments to partnerships and S corporations</header><text>For purposes of this subtitle, in the case of any qualified building directly held by any partnership or S corporation, the payment under section 6433 shall be made in lieu of the credit determined under this section with respect to such building. </text></subsection><subsection id="id4266C5B33CD14D0493C5E5C253D5F1D7"><enum>(j)</enum><header>Regulations and guidance</header><text>The Secretary shall prescribe such regulations or guidance as may be necessary to carry out the purposes of this section, including—</text><paragraph id="id8F140BF5C3344537A0E9C08B11FFCB25"><enum>(1)</enum><text>providing necessary forms and instructions, and</text></paragraph><paragraph id="id9747F89F654344CC9CFC6D710137F960"><enum>(2)</enum><text>providing for proper treatment of projects for which a credit is allowed both under this section and section 42.</text></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection display-inline="no-display-inline" commented="no" id="id77F76023DA4D4330AD0616C871EB1D1F"><enum>(b)</enum><header>Payment to partnerships and S corporations in lieu of credit</header><paragraph display-inline="no-display-inline" commented="no" id="id8D00B4302D834838A6F8ED69BC0D52D0"><enum>(1)</enum><header>In general</header><text>Subchapter B of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/65">chapter 65</external-xref> of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: </text><quoted-block style="OLC" display-inline="no-display-inline" id="idF152294C917A4A16A00AC89F76BB0831"><section id="id74D2094462504206BD5F4D68C23BF332"><enum>6433.</enum><header>Payments in lieu of renters credit for partnerships and S corporations</header><subsection id="id06E8DBDDDD9944039BA721EFE9AC0B93"><enum>(a)</enum><header>In general</header><text>In the case of any qualified building (as defined in section 36C(a)(3)) directly held by any partnership or S corporation, the Secretary shall pay to such partnership or S corporation for any taxable year an amount equal to the amount of the credit which, but for section 36C(i), would be allowed under section 36C with respect to such building.</text></subsection><subsection id="id8A5670D945AA468E9BA52FAB74C1C4FB"><enum>(b)</enum><header>Regulatory authority</header><text>The Secretary shall prescribe such regulations, rules, and guidance as may be necessary to carry out section 36C(i), section 92, and this section, including regulations, rules, and guidance providing for—</text><paragraph id="id6D7607E3B064440BBB62869052BB7373"><enum>(1)</enum><text>the application of the rules under section 36C with respect to payments under this section in the same manner as such rules apply for purposes of the credit under section 36C,</text></paragraph><paragraph id="idC615FEB163D74952A8C9178BD33C91DB"><enum>(2)</enum><text> the time and manner of payments under subsection (a), and</text></paragraph><paragraph id="idFD79AF8F742D4AEDA6B908C39BA98C6B"><enum>(3)</enum><text>the determination of a partner's distributive share, or an S corporation shareholder's pro rata share, of any payment under subsection (a). </text></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></paragraph><paragraph id="id0234d8b519174452adea4188aa89f649"><enum>(2)</enum><header>Conforming amendment</header><text>The table of sections for subchapter B of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/65">chapter 65</external-xref> of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:</text><quoted-block style="OLC" display-inline="no-display-inline" id="idB1BB5328BD2C473BBED264511F3E079D"><toc><toc-entry level="section" bold="off">Sec. 6433. Payments in lieu of renters credit for partnerships and S corporations.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection id="id5A689B8049E84C56B2B6646E809F1872"><enum>(c)</enum><header>Credit includible in gross income</header><paragraph commented="no" display-inline="no-display-inline" id="ID778D6BE9AF4A40AEA019E46FF0D1C8CD"><enum>(1)</enum><header display-inline="yes-display-inline">In general</header><text display-inline="yes-display-inline">Part II of subchapter B of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:</text><quoted-block display-inline="no-display-inline" id="IDC4CC598FC9A04FB8B092E22A2999D650" style="OLC"><section commented="no" display-inline="no-display-inline" id="ID725922F1DEDC48AC9CBC0AC479A68B61" section-type="subsequent-section"><enum>92.</enum><header display-inline="yes-display-inline">Inclusion in income of renters credit and payments</header><text display-inline="no-display-inline">Gross income includes the amount of the credit allowed to the taxpayer under section 36C for the taxable year and the amount of any payment in lieu of such credit under section 6433.</text></section><after-quoted-block>.</after-quoted-block></quoted-block></paragraph><paragraph display-inline="no-display-inline" commented="no" id="idAA6AF8B2B2984D1D8DA9564443FDEBC3"><enum>(2)</enum><header>Income disregarded for alternative minimum taxable income</header><text>Section 56(a) of such Code is amended by adding at the end the following:</text><quoted-block style="OLC" display-inline="no-display-inline" id="id359FBE7DF4B644B7B9B6BCE446FAB629"><paragraph display-inline="no-display-inline" commented="no" id="id67F0144EA7F44E5F90187BFD4ECD4999"><enum>(8)</enum><header>Section 92 not applicable</header><text>Section 92 (relating to inclusion in income of renters credit) shall not apply.</text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></paragraph><paragraph commented="no" display-inline="no-display-inline" id="ID1EA5A6A2B07945A19AD97CD311283EC1"><enum>(3)</enum><header display-inline="yes-display-inline">Conforming amendment</header><text display-inline="yes-display-inline">The table of sections for part II of subchapter B of chapter 1 of such Code is amended by adding at the end the following new item:</text><quoted-block display-inline="no-display-inline" id="ID084609D3B90E4CB4A5D9C8275499C1EC" style="OLC"><toc regeneration="no-regeneration"><toc-entry bold="off" level="section">Sec. 92. Inclusion in income of renters credit and payments.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection commented="no" display-inline="no-display-inline" id="idD54D1086429F45438DA5374BC38627F9"><enum>(d)</enum><header>Administrative fees</header><text>No provision of, or amendment made by, this Act shall be construed to prevent a rental reduction credit agency of a State from imposing fees to cover its costs or from levying any such fee on a taxpayer applying for or receiving a rental reduction credit amount.</text></subsection><subsection id="id659ABC6E0F81478B81BCB78BF7C7CCB0"><enum>(e)</enum><header>Other conforming amendments</header><paragraph id="idC3DED4996AA94A5680164BC27375E6DC"><enum>(1)</enum><text><external-xref legal-doc="usc" parsable-cite="usc/26/6211">Section 6211(b)(4)</external-xref> of the Internal Revenue Code of 1986 is amended by inserting <quote>36C (including any related payment under section 6433),</quote> after <quote>36B,</quote>.</text></paragraph><paragraph id="idee778ec169be41d0a90ac5de831f5c8c"><enum>(2)</enum><text>Paragraph (2) of section 1324(b) of title 31, United States Code, is amended by inserting <quote>36C (including any related payment under section 6433),</quote> after <quote>36B,</quote>. </text></paragraph><paragraph id="id9E4DFC1A290C4CF19C0464E73C0F157B"><enum>(3)</enum><text>The table of sections for subpart C of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 36B the following new item:</text><quoted-block style="OLC" id="id2780BD9BAF8B4797B921AEDA98DCD647"><toc><toc-entry idref="P78C9E79EF8354D92A03EC3D0FB6070E7" level="section">Sec. 36C. Renters credit.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection id="id57B3CBF842004A8680053BE6C0E25200" commented="no" display-inline="no-display-inline"><enum>(f)</enum><header>Effective date</header><text>The amendments made by this section shall apply to taxable years beginning after December 31, 2020.</text></subsection></section><section id="idD878E8484F7943E1804CF96625071D95"><enum>216.</enum><header>Middle-income housing tax credit</header><subsection id="idAA1DACC9F0694826ABF24AE3B90E0B2B"><enum>(a)</enum><header>In general</header><text>Subpart D of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986 is amended by inserting after section 42 the following new section:</text><quoted-block style="OLC" display-inline="no-display-inline" id="id6B112C71F82D4381B1B330E5C5F01844"><section commented="no" display-inline="no-display-inline" section-type="subsequent-section" id="P78C9E79EF8354D92A03EC3D0FB6070E7"><enum>42A.</enum><header>Middle-income housing credit</header><subsection id="PC3AACF1D7AC344998470A0DE598494C7"><enum>(a)</enum><header>In general</header><text>For purposes of section 38, the amount of the middle-income housing credit determined under this section for any taxable year in the credit period shall be an amount equal to—</text><paragraph id="P9ECE8C9B425C46A98BBA27742FCC8B32"><enum>(1)</enum><text>the applicable percentage, of</text></paragraph><paragraph id="P0838E3FD933D4A888B025DC6BE3D2779"><enum>(2)</enum><text>the qualified basis of each qualified middle-income building.</text></paragraph></subsection><subsection id="P146B58FDCA4F47609941A70FFADE66BC"><enum>(b)</enum><header>Applicable percentage</header><paragraph id="P4BB49DA4C90749D79C1E1F742943CA10"><enum>(1)</enum><header>Determination of applicable percentage</header><text>For purposes of this section—</text><subparagraph id="PF089DCBB76C646AD88838EF31CEDCC2A"><enum>(A)</enum><header>In general</header><text>The term <term>applicable percentage</term> means, with respect to any building, the appropriate percentage prescribed by the Secretary for the earlier of—</text><clause id="P494262CAB1C3499AA1035FADCFF626AB"><enum>(i)</enum><text>the month in which such building is placed in service, or</text></clause><clause id="P0F0B8D4E80264C92A703A07E296F5E2C"><enum>(ii)</enum><text>at the election of the taxpayer, the month in which the taxpayer and the housing credit agency enter into an agreement with respect to such building (which is binding on such agency, the taxpayer, and all successors in interest) as to the housing credit dollar amount to be allocated to such building.</text></clause><continuation-text continuation-text-level="subparagraph">A month may be elected under clause (ii) only if the election is made not later than the 5th day after the close of such month. Such an election, once made, shall be irrevocable.</continuation-text></subparagraph><subparagraph id="P05B4994697384AA9AECB3F0B421464EC"><enum>(B)</enum><header>Method of prescribing percentages</header><text>The percentages prescribed by the Secretary for any month shall be percentages which will yield over a 15-year period amounts of credit under subsection (a) which have a present value equal to—</text><clause id="idffd4a71f140e4219a1e5bd93e86bb756"><enum>(i)</enum><text>50 percent of the qualified basis of a new building which is not Federally subsidized for the taxable year, and</text></clause><clause id="id3fbf9000abd44d218f8e89f3d27b158d"><enum>(ii)</enum><text>20 percent of the qualified basis of a building not described in clause (i). </text></clause></subparagraph><subparagraph id="P25CC423D50DC4B98AA03A41A34F3BD44"><enum>(C)</enum><header>Method of discounting</header><text>The present value under subparagraph (B) shall be determined—</text><clause id="PDF05473753D847A5B308E1086857D9B3"><enum>(i)</enum><text>as of the last day of the 1st year of the 15-year period referred to in subparagraph (B),</text></clause><clause id="PF37CB0B18B7149D4819F204B4EE1CA08"><enum>(ii)</enum><text>by using a discount rate equal to 72 percent of the average of the annual Federal mid-term rate and the annual Federal long-term rate applicable under section 1274(d)(1) to the month applicable under clause (i) or (ii) of subparagraph (A) and compounded annually, and</text></clause><clause id="P65D875A6519B4DEDA862BEBE660C7D55"><enum>(iii)</enum><text>by assuming that the credit allowable under this section for any year is received on the last day of such year.</text></clause></subparagraph></paragraph><paragraph id="id0E7E77CBB9E444B39A4328F2027BA929" commented="no"><enum>(2)</enum><header>Minimum credit rate</header><subparagraph commented="no" id="id6513992FF42941A7B84B8CF871A8E90D"><enum>(A)</enum><header>In general</header><text>The applicable percentage for any building which is not Federally subsidized for the taxable year shall not be less than 5 percent.</text></subparagraph><subparagraph id="id659b69629f1b49d6a3548f3283b91936"><enum>(B)</enum><header>Minimum credit rate for Federally subsidized buildings</header><text>In the case of any building to which subparagraph (A) does not apply, except as provided in paragraph (3), the applicable percentage shall not be less than 2 percent.</text></subparagraph></paragraph><paragraph id="id9188B58D1BB94FFDACB4D2E2E620AE06"><enum>(3)</enum><header>Exception for certain Federally subsidized buildings</header><text>In the case of any building to which paragraph (2)(A) does not apply, the applicable percentage is zero unless—</text><subparagraph id="id47DAAAE4699E446480CD32EF5F3711BE"><enum>(A)</enum><text>a credit is allowed under section 42 with respect to such building for the taxable year, and</text></subparagraph><subparagraph id="id1456ADEEFF394B8086BDC4D7848E5DAE"><enum>(B)</enum><text>such building is financed by tax-exempt bonds as described in section 42(h)(4).</text></subparagraph></paragraph><paragraph commented="no" id="P23CC6FB5465F49EC9FC695652B33640E"><enum>(4)</enum><header>Cross references</header><subparagraph commented="no" id="PD761310DDE6B442A9E2526AC636789E4"><enum>(A)</enum><text>For treatment of certain rehabilitation expenditures as separate new buildings, see subsection (e).</text></subparagraph><subparagraph commented="no" id="P9D11DAB1C45D41F3ABD414CED4186149"><enum>(B)</enum><text>For determination of applicable percentage for increases in qualified basis after the 1st year of the credit period, see subsection (f)(3).</text></subparagraph><subparagraph commented="no" id="PF6DEE1BC9E78409F8A471A4F88F79F5C"><enum>(C)</enum><text>For authority of housing credit agency to limit applicable percentage and qualified basis which may be taken into account under this section with respect to any building, see subsection (h)(6).</text></subparagraph></paragraph></subsection><subsection id="P3F364467B6124D9CA2680009FE7DC3E9"><enum>(c)</enum><header>Qualified basis; qualified middle-Income building</header><text>For purposes of this section—</text><paragraph id="P795D7EA6AB0C4DB59244C8AB0907D608"><enum>(1)</enum><header>Qualified basis</header><subparagraph id="P8C9FFD6427024D92A1B81BB059BED328"><enum>(A)</enum><header>Determination</header><text>The qualified basis of any qualified middle-income building for any taxable year is an amount equal to—</text><clause id="P1BD2056C45E84CB19D386408869F88AF"><enum>(i)</enum><text>the applicable fraction (determined as of the close of such taxable year) of</text></clause><clause id="P0F8BC436C94A4A13A1C4AD1D10458D2D"><enum>(ii)</enum><text>the eligible basis of such building (determined under subsection (d)).</text></clause></subparagraph><subparagraph id="PA5728798E37F47E6BA41DD08F00B3729"><enum>(B)</enum><header>Applicable fraction</header><text>For purposes of subparagraph (A), the term <term>applicable fraction</term> means the smaller of the unit fraction or the floor space fraction.</text></subparagraph><subparagraph id="P97A38A7FD5E146F3BEDCAFFDB8EBC3F3"><enum>(C)</enum><header>Unit fraction</header><text>For purposes of subparagraph (B), the term <term>unit fraction</term> means the fraction—</text><clause id="P89FA8A0D3EC640A2854683345FD5DF0C"><enum>(i)</enum><text>the numerator of which is the number of middle-income units in the building, and</text></clause><clause id="PDF7FF691ADED4347A28EBA2D01BBDF87"><enum>(ii)</enum><text>the denominator of which is the number of residential rental units (whether or not occupied) in such building.</text></clause></subparagraph><subparagraph id="PF23E052DD8AB46D783CAF98D34ADDB05"><enum>(D)</enum><header>Floor space fraction</header><text>For purposes of subparagraph (B), the term <term>floor space fraction</term> means the fraction—</text><clause id="P7E46A8ACCCA34F418B7C97E9609962F1"><enum>(i)</enum><text>the numerator of which is the total floor space of the middle-income units in such building, and</text></clause><clause id="PE04330BD64314B4388FD2264C8C9541C"><enum>(ii)</enum><text>the denominator of which is the total floor space of the residential rental units (whether or not occupied) in such building.</text></clause></subparagraph></paragraph><paragraph id="PCE4FD62ACF9A498BB4A896F9B5C55136"><enum>(2)</enum><header>Qualified middle-income building</header><text>The term <term>qualified middle-income building</term> means any building which is part of a qualified middle-income housing project at all times during the period—</text><subparagraph id="P17E8B8C32E844B9D85BD30A2DCFA9BA4"><enum>(A)</enum><text>beginning on the 1st day in the credit period on which such building is part of such a project, and</text></subparagraph><subparagraph id="P18EA1FD1CAF64BDE8DE5B108BC7219A5"><enum>(B)</enum><text>ending on the last day of the credit period with respect to such building.</text></subparagraph></paragraph></subsection><subsection id="P7C60EB0A9A2442BB9B1A70D744B463C5"><enum>(d)</enum><header>Eligible basis</header><text>For purposes of this section—</text><paragraph id="PB0DE9C087A354A3EA64642524E973D51"><enum>(1)</enum><header>New buildings</header><text>The eligible basis of a new building is its adjusted basis as of the close of the 1st taxable year of the credit period.</text></paragraph><paragraph id="PA0EC4D3D666041C5AAD3FB1E3F80981D"><enum>(2)</enum><header>Existing buildings</header><subparagraph id="PC5BAFCEFFCF2471E9EC36AB7CE62BD42"><enum>(A)</enum><header>In general</header><text>The eligible basis of an existing building is—</text><clause id="PD36F702A201D477799C45216F0463D90"><enum>(i)</enum><text>in the case of a building which meets the requirements of subparagraph (B), its adjusted basis as of the close of the 1st taxable year of the credit period, and</text></clause><clause id="PC0E955825581402DBF75A8E889AB0987"><enum>(ii)</enum><text>zero in any other case.</text></clause></subparagraph><subparagraph id="PEE999573D0434D139CEBB976C2515D6D"><enum>(B)</enum><header>Requirements</header><text>A building meets the requirements of this subparagraph if—</text><clause id="PB7A9E9F95BD94D4281D85F2D1B61946A"><enum>(i)</enum><text>the building is acquired by purchase (as defined in section 179(d)(2)),</text></clause><clause id="P9846EF9D017D4545ACFADF32032D02B1"><enum>(ii)</enum><text>there is a period of at least 10 years between the date of its acquisition by the taxpayer and the date the building was last placed in service,</text></clause><clause id="P3AAB58CF1C3947A28F66BBE7A4E5CC04"><enum>(iii)</enum><text>the building was not previously placed in service by the taxpayer or by any person who was a related person with respect to the taxpayer as of the time previously placed in service, and</text></clause><clause commented="no" id="P879CD5CE90954C2DA38AD39199F0D3B6"><enum>(iv)</enum><text>except as provided in subsection (f)(5), a credit is allowable under subsection (a) by reason of subsection (e) with respect to the building.</text></clause></subparagraph><subparagraph id="P5E57B221621246A2BC60D48BADF379A0"><enum>(C)</enum><header>Adjusted basis</header><text>For purposes of subparagraph (A), the adjusted basis of any building shall not include so much of the basis of such building as is determined by reference to the basis of other property held at any time by the person acquiring the building.</text></subparagraph><subparagraph id="PFAF8567C17E64A3B8EDA100407CB3A33"><enum>(D)</enum><header>Special rules</header><clause id="P217177912F174B33B2472116D9A2EE94"><enum>(i)</enum><header>Special rules for certain transfers</header><text>For purposes of determining under subparagraph (B)(ii) when a building was last placed in service, there shall not be taken into account any placement in service—</text><subclause id="PD6AD277D545445D68CB26A7126E558BA"><enum>(I)</enum><text>in connection with the acquisition of the building in a transaction in which the basis of the building in the hands of the person acquiring it is determined in whole or in part by reference to the adjusted basis of such building in the hands of the person from whom acquired,</text></subclause><subclause id="P9E1248B5F7154697AAE19EE0F015FA48"><enum>(II)</enum><text>by a person whose basis in such building is determined under section 1014(a) (relating to property acquired from a decedent),</text></subclause><subclause id="P2AF901F15AFD4A1A8DA09911DCC60F6C"><enum>(III)</enum><text>by any governmental unit or qualified nonprofit organization if the requirements of subparagraph (B)(ii) are met with respect to the placement in service by such unit or organization and all the income from such property is exempt from Federal income taxation,</text></subclause><subclause id="PE05CD86DB66D4C57943031FFA313FAD5"><enum>(IV)</enum><text>by any person who acquired such building by foreclosure (or by instrument in lieu of foreclosure) of any purchase-money security interest held by such person if the requirements of subparagraph (B)(ii) are met with respect to the placement in service by such person and such building is resold within 12 months after the date such building is placed in service by such person after such foreclosure, or</text></subclause><subclause id="P93282747F2B84D51861D3A64D7C861C0"><enum>(V)</enum><text>of a single-family residence by any individual who owned and used such residence for no other purpose than as his principal residence.</text></subclause></clause><clause id="PEB93F716807748F4A349E9C6FD354E1A"><enum>(ii)</enum><header>Related person</header><text>For purposes of subparagraph (B)(iii), a person (hereinafter in this subclause referred to as the <term>related person</term>) is related to any person if the related person bears a relationship to such person specified in section 267(b) or 707(b)(1), or the related person and such person are engaged in trades or businesses under common control (within the meaning of subsections (a) and (b) of section 52).</text></clause></subparagraph></paragraph><paragraph id="P593FF2A1C2084D5EA3F9DFF3296CD699"><enum>(3)</enum><header>Special rules relating to determination of adjusted basis</header><text>For purposes of this subsection—</text><subparagraph id="PEC5E9BD3F4B04B8C9A64F9BC0F5B7EAC"><enum>(A)</enum><header>In general</header><text>Except as provided in subparagraph (B), the adjusted basis of any building shall be determined without regard to the adjusted basis of any property which is not residential rental property.</text></subparagraph><subparagraph id="P6B48FB47D8D04066A4C0641D4CAA6A7B"><enum>(B)</enum><header>Basis of property in common areas, etc., included</header><clause id="idA88C2EA7099C4000BC43DFEA7F7A7C34"><enum>(i)</enum><header>In general</header><text>Except as provided in clause (ii), the adjusted basis of any building shall be determined by taking into account the adjusted basis of property (of a character subject to the allowance for depreciation) used in common areas or provided as comparable amenities to all residential rental units in such building.</text></clause><clause id="id278C6DA368B64880AF0D648C54C26012"><enum>(ii)</enum><header>Special rule</header><text>In the case of any building for which the low-income housing tax credit is allowable under section 42, the adjusted basis of the building under this section shall be determined without regard to property used in common areas or provided as comparable amenities to all residential rental units in such building.</text></clause></subparagraph><subparagraph commented="no" id="P2488A2A27D5B4E269DA8D94345A1D9D7"><enum>(C)</enum><header>No reduction for depreciation</header><text>The adjusted basis of any building shall be determined without regard to paragraphs (2) and (3) of section 1016(a).</text></subparagraph></paragraph><paragraph id="ide7c1e5ce0db6488aa60fc1d133009c12"><enum>(4)</enum><header>Federal grants not taken into account in determining eligible basis</header><text>The eligible basis of a building shall not include any costs financed with the proceeds of a Federally funded grant. </text></paragraph><paragraph commented="no" id="P373BE918E7A64EDDB27AFDB1C5DEA070"><enum>(5)</enum><header>Credit allowable for certain buildings acquired during 10-year period</header><text>On application by the taxpayer, the Secretary may waive paragraph (2)(B)(ii) with respect to any building acquired from an insured depository institution in default (as defined in section 3 of the Federal Deposit Insurance Act) or from a receiver or conservator of such an institution.</text></paragraph><paragraph commented="no" id="P31931C1ECDE74D59B751DB61A28CAFF6"><enum>(6)</enum><header>Acquisition of building before end of prior credit period</header><subparagraph commented="no" id="P2A08BC42B0844A35BEDC209195BCC144"><enum>(A)</enum><header>In general</header><text>Under regulations prescribed by the Secretary, in the case of a building described in subparagraph (B) (or interest therein) which is acquired by the taxpayer—</text><clause commented="no" id="P46B0497E38094B2F841C861B64C8281B"><enum>(i)</enum><text>paragraph (2)(B) shall not apply, but</text></clause><clause commented="no" id="PFBC8F5C73D9D4C9EB6623611171018AF"><enum>(ii)</enum><text>the credit allowable by reason of subsection (a) to the taxpayer for any period after such acquisition shall be equal to the amount of credit which would have been allowable under subsection (a) for such period to the prior owner referred to in subparagraph (B) had such owner not disposed of the building.</text></clause></subparagraph><subparagraph commented="no" id="P12B5EAC5A1324F959DCD429C56466920"><enum>(B)</enum><header>Description of building</header><text>A building is described in this subparagraph if—</text><clause commented="no" id="PFB1B657B79E84031A102D31605353AD8"><enum>(i)</enum><text>a credit was allowed by reason of subsection (a) to any prior owner of such building, and</text></clause><clause commented="no" id="P7157ACE48ADD45F59A51211937D75022"><enum>(ii)</enum><text>the taxpayer acquired such building before the end of the credit period for such building with respect to such prior owner (determined without regard to any disposition by such prior owner).</text></clause></subparagraph></paragraph></subsection><subsection id="PB0C120743FDD44218ADF7D90C498EEE1"><enum>(e)</enum><header>Rehabilitation expenditures treated as separate new building</header><paragraph id="P22F5C92BEC72408AB77F625618441FEE"><enum>(1)</enum><header>In general</header><text>Rehabilitation expenditures paid or incurred by the taxpayer with respect to any building shall be treated for purposes of this section as a separate new building.</text></paragraph><paragraph id="P4A6E82F6747B47A4B337F4CAAFFDD05F"><enum>(2)</enum><header>Rehabilitation expenditures</header><text>For purposes of paragraph (1)—</text><subparagraph id="P3CB2C585ED7542D09683AA1E51E92D8E"><enum>(A)</enum><header>In general</header><text>The term <term>rehabilitation expenditures</term> means amounts chargeable to capital account and incurred for property (or additions or improvements to property) of a character subject to the allowance for depreciation in connection with the rehabilitation of a building.</text></subparagraph><subparagraph id="PDC00BC3C109C4E59B808CFCE0A6D2BB8"><enum>(B)</enum><header>Cost of acquisition, etc., not included</header><text>Such term does not include the cost of acquiring any building (or interest therein) or any amount not permitted to be taken into account under paragraph (3) of subsection (d).</text></subparagraph><subparagraph id="id967CF37A47894D67A204404840D06820"><enum>(C)</enum><header>Certain relocation costs</header><text>In the case of a rehabilitation of a building to which section 280B does not apply, costs relating to the relocation of occupants, including—</text><clause id="id8A14296279964ED3AA78A8096ED1F770"><enum>(i)</enum><text>amounts paid to occupants,</text></clause><clause id="id17EF73DEB7D2460BB275FE6961DBF0AF"><enum>(ii)</enum><text>amounts paid to third parties for services relating to such relocation, and</text></clause><clause id="id8A9898FC021F4A87B69B8B796BBF1737"><enum>(iii)</enum><text>amounts paid for temporary housing for occupants,</text></clause><continuation-text continuation-text-level="subparagraph">shall be treated as chargeable to capital account and taken into account as rehabilitation expenditures.</continuation-text></subparagraph></paragraph><paragraph id="PF254EFFE8CF14F3F93C93E11BFC626FD"><enum>(3)</enum><header>Minimum expenditures to qualify</header><subparagraph id="PBCA4037B85DE45A888409244F4B5E543"><enum>(A)</enum><header>In general</header><text>Paragraph (1) shall apply to rehabilitation expenditures with respect to any building only if—</text><clause id="P82AC2C6BCEB6468883C165093A0AC55C"><enum>(i)</enum><text>the expenditures are allocable to 1 or more middle-income units or substantially benefit such units, and</text></clause><clause id="PB7C2A71B6D8D4C60BB7AD3E47883EC62"><enum>(ii)</enum><text>the amount of such expenditures during any 24-month period meets the requirements of whichever of the following subclauses requires the greater amount of such expenditures:</text><subclause id="PFBAC78C3B5214C0C9DECA0D7024FC8BB"><enum>(I)</enum><text>The requirement of this subclause is met if such amount is not less than 20 percent of the adjusted basis of the building (determined as of the 1st day of such period and without regard to paragraphs (2) and (3) of section 1016(a)).</text></subclause><subclause id="P33E7D8045AD440F0AC5D6CE38BE5DFC1"><enum>(II)</enum><text>The requirement of this subclause is met if the qualified basis attributable to such amount, when divided by the number of middle-income units in the building, is equal to or greater than the dollar amount in effect under section 42(e)(3)(A)(ii)(II) for the calendar year in which such expenditures are treated as placed in service under paragraph (4).</text></subclause></clause></subparagraph><subparagraph id="P03019580753946F2B7EAD9B28E1732E3"><enum>(B)</enum><header>Date of determination</header><text>The determination under subparagraph (A) shall be made as of the close of the 1st taxable year in the credit period with respect to such expenditures.</text></subparagraph></paragraph><paragraph id="PF1AB321343FB447EA0F183BAB3920DCC"><enum>(4)</enum><header>Special rules</header><text>For purposes of applying this section with respect to expenditures which are treated as a separate building by reason of this subsection—</text><subparagraph id="P88541D0200A54629A9B1829958C0D184"><enum>(A)</enum><text>such expenditures shall be treated as placed in service at the close of the 24-month period referred to in paragraph (3)(A), and</text></subparagraph><subparagraph id="PC626AD0232374A60BA79AA247A854718"><enum>(B)</enum><text>the applicable fraction under subsection (c)(1) shall be the applicable fraction for the building (without regard to paragraph (1)) with respect to which the expenditures were incurred.</text></subparagraph><continuation-text continuation-text-level="paragraph">Nothing in subsection (d)(2) shall prevent a credit from being allowed by reason of this subsection.</continuation-text></paragraph><paragraph id="PF6547981B8204007B0A1E94922830E98"><enum>(5)</enum><header>No double counting</header><text>Rehabilitation expenditures may, at the election of the taxpayer, be taken into account under this subsection or subsection (d)(2)(A)(i) but not under both such subsections.</text></paragraph><paragraph id="P03C0B192121F4801A9A44457ED138E1B"><enum>(6)</enum><header>Regulations to apply subsection with respect to group of units in building</header><text>The Secretary may prescribe regulations, consistent with the purposes of this subsection, treating a group of units with respect to which rehabilitation expenditures are incurred as a separate new building.</text></paragraph></subsection><subsection id="P0EECF4E694FD4D0AB6619F62A1A15C42"><enum>(f)</enum><header>Definition and special rules relating to credit period</header><paragraph id="P3137D189296949FD872AFAD517A82EB5"><enum>(1)</enum><header>Credit period defined</header><text>For purposes of this section, the term <term>credit period</term> means, with respect to any building, the period of 15 taxable years beginning with—</text><subparagraph id="P22D0F015497D45128231EA94CB3958F6"><enum>(A)</enum><text>the taxable year in which the building is placed in service, or</text></subparagraph><subparagraph id="P3503CB68ED894BC0A33E95E907C00526"><enum>(B)</enum><text>at the election of the taxpayer, the succeeding taxable year,</text></subparagraph><continuation-text continuation-text-level="paragraph">but only if the building is a qualified middle-income building as of the close of the 1st year of such period. The election under subparagraph (B), once made, shall be irrevocable.</continuation-text></paragraph><paragraph id="P0105EDAFB28B4C1C9B150FD4B178759A"><enum>(2)</enum><header>Special rule for 1st year of credit period</header><subparagraph id="P9C61F0231EA0472BA542393E0CE42D0F"><enum>(A)</enum><header>In general</header><text>The credit allowable under subsection (a) with respect to any building for the 1st taxable year of the credit period shall be determined by substituting for the applicable fraction under subsection (c)(1) the fraction—</text><clause id="PE62AAFA7C9004A659013042B4DF8E986"><enum>(i)</enum><text>the numerator of which is the sum of the applicable fractions determined under subsection (c)(1) as of the close of each full month of such year during which such building was in service, and</text></clause><clause id="P0C7ECBC876994B97AE4ABA87385459E5"><enum>(ii)</enum><text>the denominator of which is 12.</text></clause></subparagraph><subparagraph id="PEB7294216BC64B6D9F954DC1D1317159"><enum>(B)</enum><header>Disallowed 1st-year credit allowed in 16th year</header><text>Any reduction by reason of subparagraph (A) in the credit allowable (without regard to subparagraph (A)) for the 1st taxable year of the credit period shall be allowable under subsection (a) for the 1st taxable year following the credit period.</text></subparagraph></paragraph><paragraph commented="no" id="P9F562C2194EA4A90BDAFF3EFD3A6F518"><enum>(3)</enum><header>Determination of applicable percentage with respect to increases in qualified basis after 1st year of credit period</header><subparagraph commented="no" id="P0BFBCFAA1E8249FCAFB386D8686926E2"><enum>(A)</enum><header>In general</header><text>In the case of any building which was a qualified middle-income building as of the close of the 1st year of the credit period, if—</text><clause commented="no" id="P0273960FA2FC4604BA721A46881EF153"><enum>(i)</enum><text>as of the close of any taxable year in the credit period (after the 1st year of such period) the qualified basis of such building, exceeds</text></clause><clause commented="no" id="PA42DFCD401024F7F8DA64601E21F5496"><enum>(ii)</enum><text>the qualified basis of such building as of the close of the 1st year of the credit period,</text></clause><continuation-text commented="no" continuation-text-level="subparagraph">the applicable percentage which shall apply under subsection (a) for the taxable year to such excess shall be the percentage equal to <fraction>2/3</fraction> of the applicable percentage which (after the application of subsection (h)) would but for this paragraph apply to such basis.</continuation-text></subparagraph><subparagraph id="PD724E81D30974FCD889DEE20C7BB1829"><enum>(B)</enum><header>1st year computation applies</header><text>A rule similar to the rule of paragraph (2)(A) shall apply to any increase in qualified basis to which subparagraph (A) applies for the 1st year of such increase.</text></subparagraph></paragraph><paragraph id="PC9B14C1B8DDD4CD9AE166686EDC4EB40"><enum>(4)</enum><header>Dispositions of property</header><text>If a building (or an interest therein) is disposed of during any year for which credit is allowable under subsection (a), such credit shall be allocated between the parties on the basis of the number of days during such year the building (or interest) was held by each.</text></paragraph><paragraph id="P6B17127328DC40639AE0885DA25E7048"><enum>(5)</enum><header>Credit period for existing buildings not to begin before rehabilitation credit allowed</header><subparagraph id="PEA5FE291429F4D0E90D0247EFEE6D38B"><enum>(A)</enum><header>In general</header><text>The credit period for an existing building shall not begin before the 1st taxable year of the credit period for rehabilitation expenditures with respect to the building.</text></subparagraph><subparagraph id="P0FD0E8B7BDF344A08EE372172D66E0CA"><enum>(B)</enum><header>Acquisition credit allowed for certain buildings not allowed a rehabilitation credit</header><clause id="P4E96434064784831A57E7A3A051FFE88"><enum>(i)</enum><header>In general</header><text>In the case of a building described in clause (ii)—</text><subclause id="P39DAA8A81B5B470F833EEAC0EFCA6753"><enum>(I)</enum><text>subsection (d)(2)(B)(iv) shall not apply, and</text></subclause><subclause id="P4C47638CD5E3486AA9ED8396CE8EFAE4"><enum>(II)</enum><text>the credit period for such building shall not begin before the taxable year which would be the 1st taxable year of the credit period for rehabilitation expenditures with respect to the building under the modifications described in clause (ii)(II).</text></subclause></clause><clause id="PC8D0B75233704536AACEAAE1CCA024C5"><enum>(ii)</enum><header>Building described</header><text>A building is described in this clause if—</text><subclause id="P326AAB2D70E745DBB8C5346C64D9619B"><enum>(I)</enum><text>a waiver is granted under subsection (d)(4) with respect to the acquisition of the building, and</text></subclause><subclause id="P4281286A867C44A4B7B23CF3E2AE8E8B"><enum>(II)</enum><text>a credit would be allowed for rehabilitation expenditures with respect to such building if subsection (e)(3)(A)(ii)(I) did not apply and if the dollar amount in effect under subsection (e)(3)(A)(ii)(II) were two-thirds of such amount.</text></subclause></clause></subparagraph></paragraph></subsection><subsection id="P193D2F50363E4177922A494EAE6C3D59"><enum>(g)</enum><header>Qualified middle-Income housing project</header><text>For purposes of this section—</text><paragraph id="P00D21DC1B58D44E6B7269D1EB818AF1B"><enum>(1)</enum><header>In general</header><text>The term <term>qualified middle-income housing project</term> means any project for residential rental property if 60 percent or more of the residential units in such project are both rent-restricted and occupied by individuals whose income is 100 percent or less of area median gross income. For purposes of the preceding sentence, residential units in a building which is not a qualified middle-income building by reason of subsection (c)(2)(B) shall not be taken into account.</text></paragraph><paragraph id="P0BEB31013C824904AE6628F5C6FACAA8"><enum>(2)</enum><header>Rent-restricted units</header><subparagraph id="P201DE2C7BDC2494AABE8878764480037"><enum>(A)</enum><header>In general</header><text>For purposes of paragraph (1), a residential unit is rent-restricted if the gross rent with respect to such unit does not exceed 30 percent of the imputed income limitation applicable to such unit. For purposes of the preceding sentence, the amount of the income limitation under paragraph (1) applicable for any period shall not be less than such limitation applicable for the earliest period the building (which contains the unit) was included in the determination of whether the project is a qualified middle-income housing project.</text></subparagraph><subparagraph id="PAA598FE8B17A47AC9B7945C03917EAC3"><enum>(B)</enum><header>Gross rent</header><text>For purposes of subparagraph (A), gross rent—</text><clause commented="no" id="PDCE04ED36A1243AE94B90683B24FBFA1"><enum>(i)</enum><text>includes any utility allowance determined by the Secretary after taking into account such determinations under section 8 of the United States Housing Act of 1937,</text></clause><clause commented="no" id="P2FD1B289E87E4C30BFBEC9637013F68F"><enum>(ii)</enum><text>does not include any fee for a supportive service which is paid to the owner of the unit (on the basis of the middle-income status of the tenant of the unit) by any governmental program of assistance (or by an organization described in section 501(c)(3) and exempt from tax under section 501(a)) if such program (or organization) provides assistance for rent and the amount of assistance provided for rent is not separable from the amount of assistance provided for supportive services, and</text></clause><clause id="PB59EAB96E611467D8FBC30B48A0A6EF1"><enum>(iii)</enum><text>does not include any rental payment to the owner of the unit to the extent such owner pays an equivalent amount to the Farmers' Home Administration under section 515 of the Housing Act of 1949.</text></clause><continuation-text continuation-text-level="subparagraph">For purposes of clause (ii), the term <term>supportive service</term> means any service provided under a planned program of services designed to enable residents of a residential rental property to remain independent and avoid placement in a hospital, nursing home, or intermediate care facility for the mentally or physically handicapped.</continuation-text></subparagraph><subparagraph id="PF7A5376694674C9A8286A260923C82B7"><enum>(C)</enum><header>Imputed income limitation applicable to unit</header><text>For purposes of this paragraph, the imputed income limitation applicable to a unit is the income limitation which would apply under paragraph (1) to individuals occupying the unit if the number of individuals occupying the unit were as follows:</text><clause id="P12373317724C4C019C658B81F86084E1"><enum>(i)</enum><text>In the case of a unit which does not have a separate bedroom, 1 individual.</text></clause><clause id="PB840187B5341457A96343FAE066FBE86"><enum>(ii)</enum><text>In the case of a unit which has 1 or more separate bedrooms, 1.5 individuals for each separate bedroom.</text></clause><continuation-text continuation-text-level="subparagraph">In the case of a project with respect to which a credit is allowable by reason of this section and for which financing is provided by a bond described in section 142(a)(7), the imputed income limitation shall apply in lieu of the otherwise applicable income limitation for purposes of applying section 142(d)(4)(B)(ii). </continuation-text></subparagraph><subparagraph id="PBB1ACFC7B5294FC5BF11D23DED47E5EE"><enum>(D)</enum><header>Treatment of units occupied by individuals whose incomes rise above limit</header><clause id="P5CF2B68645AA44CF800383795ACAABB2"><enum>(i)</enum><header>In general</header><text>Except as provided in clause (ii), notwithstanding an increase in the income of the occupants of a middle-income unit above the income limitation applicable under paragraph (1), such unit shall continue to be treated as a middle-income unit if the income of such occupants initially met such income limitation and such unit continues to be rent-restricted.</text></clause><clause id="P8E4F7D32231E43829A0B59213234376F"><enum>(ii)</enum><header>Next available unit must be rented to middle-income tenant if income rises above 140 percent of income limit</header><text>If the income of the occupants of the unit increases above 140 percent of the income limitation applicable under paragraph (1), clause (i) shall cease to apply to such unit if any residential rental unit in the building (of a size comparable to, or smaller than, such unit) is occupied by a new resident whose income exceeds such income limitation.</text></clause></subparagraph></paragraph><paragraph id="PE7CBD4BB4C534CEA94AD8D6EBA734268"><enum>(3)</enum><header>Date for meeting requirements</header><subparagraph id="P8834862A0B07496DB7E30ECEA65C2E0F"><enum>(A)</enum><header>In general</header><text>Except as otherwise provided in this paragraph, a building shall be treated as a qualified middle-income building only if the project (of which such building is a part) meets the requirements of paragraph (1) not later than the close of the 1st year of the credit period for such building.</text></subparagraph><subparagraph id="PC97F84185F694226B76A6D6DF6101B33"><enum>(B)</enum><header>Buildings which rely on later buildings for qualification</header><clause id="PA8E47FF09B7440718FF66CF22C47149E"><enum>(i)</enum><header>In general</header><text>In determining whether a building (hereinafter in this subparagraph referred to as the <quote>prior building</quote>) is a qualified middle-income building, the taxpayer may take into account 1 or more additional buildings placed in service during the 12-month period described in subparagraph (A) with respect to the prior building only if the taxpayer elects to apply clause (ii) with respect to each additional building taken into account.</text></clause><clause id="PF075A07D8EE64A10ABD1CA089D6151F1"><enum>(ii)</enum><header>Treatment of elected buildings</header><text>In the case of a building which the taxpayer elects to take into account under clause (i), the period under subparagraph (A) for such building shall end at the close of the 12-month period applicable to the prior building.</text></clause><clause id="P241745273F584DBC834677E2B244CBAF"><enum>(iii)</enum><header>Date prior building is treated as placed in service</header><text>For purposes of determining the credit period for the prior building, the prior building shall be treated for purposes of this section as placed in service on the most recent date any additional building elected by the taxpayer (with respect to such prior building) was placed in service.</text></clause></subparagraph><subparagraph id="PB64D3B8B49D3486CA9F1D321750C26A1"><enum>(C)</enum><header>Special rule</header><text>A building—</text><clause id="P292B41F369C446C2BDA1EA0C88D3850B"><enum>(i)</enum><text>other than the 1st building placed in service as part of a project, and</text></clause><clause id="P834EE94562034387B55C1FCD80950064"><enum>(ii)</enum><text>other than a building which is placed in service during the 12-month period described in subparagraph (A) with respect to a prior building which becomes a qualified middle-income building,</text></clause><continuation-text continuation-text-level="subparagraph">shall in no event be treated as a qualified middle-income building unless the project is a qualified middle-income housing project (without regard to such building) on the date such building is placed in service.</continuation-text></subparagraph><subparagraph id="PC6ED9F1FDF93495790C394A32BE99C7B"><enum>(D)</enum><header>Projects with more than 1 building must be identified</header><text>For purposes of this section, a project shall be treated as consisting of only 1 building unless, before the close of the 1st calendar year in the project period (as defined in subsection (h)(1)(F)(ii)), each building which is (or will be) part of such project is identified in such form and manner as the Secretary may provide.</text></subparagraph></paragraph><paragraph commented="no" id="P25D1268DC2EE441C9686559E2D266737"><enum>(4)</enum><header>Certain rules made applicable</header><text>Paragraphs (2) (other than subparagraph (A) thereof), (3), and (7) of section 142(d), and section 6652(j), shall apply for purposes of determining whether any project is a qualified middle-income housing project and whether any unit is a middle-income unit; except that, in applying such provisions for such purposes—</text><subparagraph commented="no" id="id116CAAED4FB0414C8AFB20634E3BE6DD"><enum>(A)</enum><text>the term <term>gross rent</term> shall have the meaning given such term by paragraph (2)(B) of this subsection, and</text></subparagraph><subparagraph commented="no" id="id61555DBC9B6D4A80A07F04109D5A7F9F"><enum>(B)</enum><text>the term <term>applicable income limit</term> means the limitation under paragraph (1) of this subsection.</text></subparagraph></paragraph><paragraph commented="no" id="PBECD81090EA449B5889835D7401BD98B"><enum>(5)</enum><header>Election to treat building after credit period as not part of a project</header><text>For purposes of this section, the taxpayer may elect to treat any building as not part of a qualified middle-income housing project for any period beginning after the credit period for such building.</text></paragraph><paragraph id="P9D8BFB426F8B40FF9DA133973865857C"><enum>(6)</enum><header>Special rule where de minimis equity contribution</header><text>Property shall not be treated as failing to be residential rental property for purposes of this section merely because the occupant of a residential unit in the project pays (on a voluntary basis) to the lessor a de minimis amount to be held toward the purchase by such occupant of a residential unit in such project if—</text><subparagraph id="P6DE835A9360747FD942CE1D9F285A392"><enum>(A)</enum><text>all amounts so paid are refunded to the occupant on the cessation of his occupancy of a unit in the project, and</text></subparagraph><subparagraph id="P56490026C49C43C08251CB78AA8765E9"><enum>(B)</enum><text>the purchase of the unit is not permitted until after the close of the credit period with respect to the building in which the unit is located.</text></subparagraph><continuation-text continuation-text-level="paragraph">Any amount paid to the lessor as described in the preceding sentence shall be included in gross rent under paragraph (2) for purposes of determining whether the unit is rent-restricted.</continuation-text></paragraph><paragraph id="P3204276A36F24AFAA998699D482A598D"><enum>(7)</enum><header>Scattered site projects</header><text>Buildings which would (but for their lack of proximity) be treated as a project for purposes of this section shall be so treated if all of the dwelling units in each of the buildings are rent-restricted (within the meaning of paragraph (2)) residential rental units.</text></paragraph><paragraph id="P6F33BDC217304C0AA916925113C77DAC"><enum>(8)</enum><header>Waiver of certain recertifications</header><text>On application by the taxpayer, the Secretary may waive any annual recertification of tenant income for purposes of this subsection, if the entire building is occupied by middle-income tenants.</text></paragraph><paragraph id="PA1CDBB631A49460895524E937F4B093E"><enum>(9)</enum><header>Clarification of general public use requirement</header><text>A project does not fail to meet the general public use requirement solely because of occupancy restrictions or preferences that favor tenants—</text><subparagraph id="PB490F6DBC31240A8982D1370DBC864A1"><enum>(A)</enum><text>with special needs, or</text></subparagraph><subparagraph id="P08C9A07D97D447569BD7D2BCF20F9B37"><enum>(B)</enum><text>who are members of a specified group under a Federal program or State program or policy that supports housing for such a specified group.</text></subparagraph></paragraph></subsection><subsection id="PFA32C249D2D7483A92C4D3A41F784F23"><enum>(h)</enum><header>Limitation on aggregate credit allowable with respect to projects located in a State</header><paragraph id="PD7BB943EF67346EEB8C1B06450E3146B"><enum>(1)</enum><header>Credit may not exceed credit amount allocated to building</header><subparagraph id="P47B53B4D5C0E475E9B1CB2D40F4FEE64"><enum>(A)</enum><header>In general</header><text>The amount of the credit determined under this section for any taxable year with respect to any building shall not exceed the housing credit dollar amount allocated to such building under this subsection.</text></subparagraph><subparagraph id="P99F4F199321A4007863889EB6CC0CCEA"><enum>(B)</enum><header>Time for making allocation</header><text>Except in the case of an allocation which meets the requirements of subparagraph (C), (D), (E), or (F), an allocation shall be taken into account under subparagraph (A) only if it is made not later than the close of the calendar year in which the building is placed in service.</text></subparagraph><subparagraph id="P9161EB02C9D14FCEB87B9A87C3ED4236"><enum>(C)</enum><header>Exception where binding commitment</header><text>An allocation meets the requirements of this subparagraph if there is a binding commitment (not later than the close of the calendar year in which the building is placed in service) by the housing credit agency to allocate a specified housing credit dollar amount to such building beginning in a specified later taxable year.</text></subparagraph><subparagraph id="PFAC0AA335A794796A061D8980A57680C"><enum>(D)</enum><header>Exception where increase in qualified basis</header><clause id="PB869EEFEB92944E0A720456EB1DAAE4A"><enum>(i)</enum><header>In general</header><text>An allocation meets the requirements of this subparagraph if such allocation is made not later than the close of the calendar year in which ends the taxable year to which it will 1st apply but only to the extent the amount of such allocation does not exceed the limitation under clause (ii).</text></clause><clause id="PA0AD0681874A4A7A9F6FACD02C152FE6"><enum>(ii)</enum><header>Limitation</header><text>The limitation under this clause is the amount of credit allowable under this section (without regard to this subsection) for a taxable year with respect to an increase in the qualified basis of the building equal to the excess of—</text><subclause id="PC7E6F8594A134D67BB4E11737DDAC4CE"><enum>(I)</enum><text>the qualified basis of such building as of the close of the 1st taxable year to which such allocation will apply, over</text></subclause><subclause id="P5FD84473003C471FA61A761B6E38D34E"><enum>(II)</enum><text>the qualified basis of such building as of the close of the 1st taxable year to which the most recent prior housing credit allocation with respect to such building applied.</text></subclause></clause><clause id="P99B0312892414AAF841CC8C6B7728ACC"><enum>(iii)</enum><header>Housing credit dollar amount reduced by full allocation</header><text>Notwithstanding clause (i), the full amount of the allocation shall be taken into account under paragraph (2).</text></clause></subparagraph><subparagraph id="PC2A02CA919114A1884BAB4797D8BBDD1"><enum>(E)</enum><header>Exception where 10 percent of cost incurred</header><clause id="P9C127851232A40F981F728A42D0796E2"><enum>(i)</enum><header>In general</header><text>An allocation meets the requirements of this subparagraph if such allocation is made with respect to a qualified building which is placed in service not later than the close of the second calendar year following the calendar year in which the allocation is made.</text></clause><clause id="P220ADDD42DC9440C9B7EF25F77D3257C"><enum>(ii)</enum><header>Qualified building</header><text>For purposes of clause (i), the term <term>qualified building</term> means any building which is part of a project if the taxpayer's basis in such project (as of the date which is 1 year after the date that the allocation was made) is more than 10 percent of the taxpayer's reasonably expected basis in such project (as of the close of the second calendar year referred to in clause (i)). Such term does not include any existing building unless a credit is allowable under subsection (e) for rehabilitation expenditures paid or incurred by the taxpayer with respect to such building for a taxable year ending during the second calendar year referred to in clause (i) or the prior taxable year.</text></clause></subparagraph><subparagraph id="PECABDFA882EC4B3C8CDCE2DBDA5B0FDC"><enum>(F)</enum><header>Allocation of credit on a project basis</header><clause id="PDA2A88EEC0424C7B86FD682E5D006975"><enum>(i)</enum><header>In general</header><text>In the case of a project which includes (or will include) more than 1 building, an allocation meets the requirements of this subparagraph if—</text><subclause id="P23702CE32E1445B9BE46F9B564AB15C9"><enum>(I)</enum><text>the allocation is made to the project for a calendar year during the project period,</text></subclause><subclause id="P4948CF42908C4205BB7EF7DC33FC8112"><enum>(II)</enum><text>the allocation only applies to buildings placed in service during or after the calendar year for which the allocation is made, and</text></subclause><subclause id="PCA3FF3B7942F4344AEE4C3DFBC24C691"><enum>(III)</enum><text>the portion of such allocation which is allocated to any building in such project is specified not later than the close of the calendar year in which the building is placed in service.</text></subclause></clause><clause id="P5904F95D4F58478B87320C7AE9461AF3"><enum>(ii)</enum><header>Project period</header><text>For purposes of clause (i), the term <term>project period</term> means the period—</text><subclause id="PD39733F5F0F441F39C11583381AE9F81"><enum>(I)</enum><text>beginning with the 1st calendar year for which an allocation may be made for the 1st building placed in service as part of such project, and</text></subclause><subclause id="PAD20E1275A7D4B8C837832DEF655ACA2"><enum>(II)</enum><text>ending with the calendar year the last building is placed in service as part of such project.</text></subclause></clause></subparagraph></paragraph><paragraph id="P37A485F1D7A041ACBDD788A61960DD23"><enum>(2)</enum><header>Allocated credit amount to apply to all taxable years ending during or after credit allocation year</header><text>Any housing credit dollar amount allocated to any building for any calendar year—</text><subparagraph id="P640B7E527E934F628C74352B50EC52E6"><enum>(A)</enum><text>shall apply to such building for all taxable years in the credit period ending during or after such calendar year, and</text></subparagraph><subparagraph id="P08FBABA887A941A681E7F88A09ED629D"><enum>(B)</enum><text>shall reduce the aggregate housing credit dollar amount of the allocating agency only for such calendar year.</text></subparagraph></paragraph><paragraph id="PFEFBD1F1CB0D4783824B90CFDD0A9082"><enum>(3)</enum><header>Housing credit dollar amount for agencies</header><subparagraph id="P2D5FEF3446964919A9FA4117B396332A"><enum>(A)</enum><header>In general</header><text>The aggregate housing credit dollar amount which a housing credit agency may allocate for any calendar year is the portion of the State housing credit ceiling allocated under this paragraph for such calendar year to such agency.</text></subparagraph><subparagraph id="PE9FD7E315A694FE4B22B9AC2A21164C2"><enum>(B)</enum><header>State ceiling initially allocated to State housing credit agencies</header><text>Except as provided in subparagraph (D), the State housing credit ceiling for each calendar year shall be allocated to the housing credit agency of such State. If there is more than 1 housing credit agency of a State, all such agencies shall be treated as a single agency.</text></subparagraph><subparagraph id="P18787579BB6A4AECA0E489FE2774607D"><enum>(C)</enum><header>State housing credit ceiling</header><text>The State housing credit ceiling applicable to any State for any calendar year shall be an amount equal to the sum of—</text><clause id="P02D59999A7AD40DABC275553EB8C77BA"><enum>(i)</enum><text>the greater of—</text><subclause id="PB686C71CAA8246A4B1A75A51244115E2"><enum>(I)</enum><text>$1.00 multiplied by the State population, or</text></subclause><subclause id="PC82EE2E0526E4BEC86BA270A0EEADDD7"><enum>(II)</enum><text>$1,140,000, plus</text></subclause></clause><clause id="PF6F2B972539041339CED296D78449DF9"><enum>(ii)</enum><text>the amount of State housing credit ceiling returned in the calendar year.</text></clause><continuation-text continuation-text-level="subparagraph">For purposes of clause (ii), the amount of State housing credit ceiling returned in the calendar year equals the housing credit dollar amount previously allocated within the State to any project which fails to meet the 10 percent test under paragraph (1)(E)(ii) on a date after the close of the calendar year in which the allocation was made or which does not become a qualified middle-income housing project within the period required by this section or the terms of the allocation or to any project with respect to which an allocation is cancelled by mutual consent of the housing credit agency and the allocation recipient.</continuation-text></subparagraph><subparagraph id="PFE8E1011EB954CF28D20F810E3DA3F8C"><enum>(D)</enum><header>State may provide for different allocation</header><text>Rules similar to the rules of section 146(e) (other than paragraph (2)(B) thereof) shall apply for purposes of this paragraph.</text></subparagraph><subparagraph id="P16999E24C72B4C2AB1E8371F7DB29459"><enum>(E)</enum><header>Population</header><text>For purposes of this paragraph, population shall be determined in accordance with section 146(j).</text></subparagraph><subparagraph id="P9F3047F43E0E47D5A121EE65C6BC7CEF"><enum>(F)</enum><header>Cost-of-living adjustment</header><clause id="PA2567B500E5D493E962B718E05D78865"><enum>(i)</enum><header>In general</header><text>In the case of a calendar year after 2022, the $1,140,000 and $1.00 amounts in subparagraph (C) shall each be increased by an amount equal to—</text><subclause id="PD88BBBC9775D46DE837330F3A022B339"><enum>(I)</enum><text>such dollar amount, multiplied by</text></subclause><subclause id="PB5CC7EFB199CT95EB9C2108880A928BF"><enum>(II)</enum><text>the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting <quote>calendar year 2021</quote> for <quote>calendar year 2016</quote> in subparagraph (A)(ii) thereof.</text></subclause></clause><clause id="PEFFC09D4ED0E44C9B4B7EBB6F4BDB0BA"><enum>(ii)</enum><header>Rounding</header><subclause id="PE29FFC1685BB4496BE244A8FA40A16AE"><enum>(I)</enum><text>In the case of the $1,140,000 amount, any increase under clause (i) which is not a multiple of $5,000 shall be rounded to the next lowest multiple of $5,000.</text></subclause><subclause id="PBF077BE4223A454F92A06AD0C691AE77"><enum>(II)</enum><text>In the case of the $1.00 amount, any increase under clause (i) which is not a multiple of 5 cents shall be rounded to the next lowest multiple of 5 cents.</text></subclause></clause></subparagraph></paragraph><paragraph commented="no" id="P0794846BDD5F4D0F9058739661CAF63A"><enum>(4)</enum><header>Portion of State ceiling set-aside for certain projects involving qualified nonprofit organizations</header><subparagraph commented="no" id="P1935FE90D1994FD3869CACE16CCF0787"><enum>(A)</enum><header>In general</header><text>Not more than 90 percent of the State housing credit ceiling (determined without regard to paragraph (7)) for any State for any calendar year shall be allocated to projects other than qualified middle-income housing projects described in subparagraph (B).</text></subparagraph><subparagraph commented="no" id="PCAEBDBAC18A94C699B8377290AF0A654"><enum>(B)</enum><header>Projects involving qualified nonprofit organizations</header><text>For purposes of subparagraph (A), a qualified middle-income housing project is described in this subparagraph if a qualified nonprofit organization is to own an interest in the project (directly or through a partnership) and materially participate (within the meaning of section 469(h)) in the development and operation of the project throughout the credit period.</text></subparagraph><subparagraph commented="no" id="P9CEC8D76E4EB45B28B493016F4198A95"><enum>(C)</enum><header>Qualified nonprofit organization</header><text>For purposes of this paragraph, the term <term>qualified nonprofit organization</term> means any organization if—</text><clause commented="no" id="PF5530E40ABA3412ABDDAE62884D088E6"><enum>(i)</enum><text>such organization is described in paragraph (3) or (4) of section 501(c) and is exempt from tax under section 501(a),</text></clause><clause commented="no" id="PD7E9B482CC3C48D985D7920D7B1B0F19"><enum>(ii)</enum><text>such organization is determined by the State housing credit agency not to be affiliated with or controlled by a for-profit organization; and</text></clause><clause commented="no" id="P9E06D2C127104877AA5FBF818D546AC0"><enum>(iii)</enum><text>one of the exempt purposes of such organization includes the fostering of middle-income housing.</text></clause></subparagraph><subparagraph commented="no" id="P73928FD3018A4FD185E1D992E54B3C96"><enum>(D)</enum><header>Treatment of certain subsidiaries</header><clause commented="no" id="PF6AC9E3F8B8F4C23897B779C534B2FEB"><enum>(i)</enum><header>In general</header><text>For purposes of this paragraph, a qualified nonprofit organization shall be treated as satisfying the ownership and material participation test of subparagraph (B) if any qualified corporation in which such organization holds stock satisfies such test.</text></clause><clause commented="no" id="P2C78CCFFAD1B495887F2C3828E743702"><enum>(ii)</enum><header>Qualified corporation</header><text>For purposes of clause (i), the term <term>qualified corporation</term> means any corporation if 100 percent of the stock of such corporation is held by 1 or more qualified nonprofit organizations at all times during the period such corporation is in existence.</text></clause></subparagraph><subparagraph commented="no" id="PA2B3A42ED5FF40C59F0C43D1461468C8"><enum>(E)</enum><header>State may not override set-aside</header><text>Nothing in subparagraph (E) of paragraph (3) shall be construed to permit a State not to comply with subparagraph (A) of this paragraph.</text></subparagraph></paragraph><paragraph commented="no" id="P658727D6A6234DDAB9953048FB06BB64"><enum>(5)</enum><header>Buildings eligible for credit only if minimum long-term commitment to middle-income housing</header><subparagraph commented="no" id="P5AF8EDC921774A03B51AD9D0B7CC1AC7"><enum>(A)</enum><header>In general</header><text>No credit shall be allowed by reason of this section with respect to any building for the taxable year unless an extended middle-income housing commitment is in effect as of the end of such taxable year.</text></subparagraph><subparagraph commented="no" id="PBA8EEC96B1B445948C0490A3F36DCBA7"><enum>(B)</enum><header>Extended middle-income housing commitment</header><text>For purposes of this paragraph, the term <term>extended middle-income housing commitment</term> means any agreement between the taxpayer and the housing credit agency—</text><clause commented="no" id="PC0198DFC04CA49159B36A166E17FB3A5"><enum>(i)</enum><text>which requires that the applicable fraction (as defined in subsection (c)(1)) for the building for each taxable year in the extended use period will not be less than the applicable fraction specified in such agreement and which prohibits the actions described in subclauses (I) and (II) of subparagraph (E)(ii),</text></clause><clause commented="no" id="P226919ACE84A45C4BC252B0CB6EACF83"><enum>(ii)</enum><text>which allows individuals who meet the income limitation applicable to the building under subsection (g) (whether prospective, present, or former occupants of the building) the right to enforce in any State court the requirement and prohibitions of clause (i),</text></clause><clause commented="no" id="P14748DE9D5A7481BB7111C8DC85F9059"><enum>(iii)</enum><text>which prohibits the disposition to any person of any portion of the building to which such agreement applies unless all of the building to which such agreement applies is disposed of to such person,</text></clause><clause commented="no" id="PEF4DCBE5B0814DA6A9CD3B2C0B7FD13B"><enum>(iv)</enum><text>which prohibits the refusal to lease to a holder of a voucher or certificate of eligibility under section 8 of the United States Housing Act of 1937 because of the status of the prospective tenant as such a holder,</text></clause><clause commented="no" id="P0F5251E661014E628485DB6D439EC3BD"><enum>(v)</enum><text>which is binding on all successors of the taxpayer, and</text></clause><clause commented="no" id="P865455E79A2A437392895F3C64E917DA"><enum>(vi)</enum><text>which, with respect to the property, is recorded pursuant to State law as a restrictive covenant.</text></clause></subparagraph><subparagraph commented="no" id="P154F7E33ACE145AC86A99DCCA70B55F3"><enum>(C)</enum><header>Allocation of credit may not exceed amount necessary to support commitment</header><text>The housing credit dollar amount allocated to any building may not exceed the amount necessary to support the applicable fraction specified in the extended middle-income housing commitment for such building, including any increase in such fraction pursuant to the application of subsection (f)(3) if such increase is reflected in an amended middle-income housing commitment.</text></subparagraph><subparagraph id="id713f5e70ace34c7b8955f943cf938c8b"><enum>(D)</enum><header>Extended use period</header><text>For purposes of this paragraph, the term <term>extended use period</term> means the period—</text><clause id="id7bbd428c8ee24b7f8717e3e3e355b7bb"><enum>(i)</enum><text>beginning on the 1st day in the credit period on which such building is part of a qualified middle-income housing project, and</text></clause><clause id="id37a85c3c37b245f9892b27e7d225191e"><enum>(ii)</enum><text>ending on the later of—</text><subclause id="ida9fc3965025e4e1da2925ed3a40273ce"><enum>(I)</enum><text>the date specified by such agency in such agreement, or</text></subclause><subclause id="id6589b159152c49a28805a01bb60f0b7a"><enum>(II)</enum><text>the date which is 15 years after the close of the credit period.</text></subclause></clause></subparagraph><subparagraph id="P9BF2641E2A6F4BF3B95EE6E053C762DE"><enum>(E)</enum><header>Exceptions if foreclosure or if no buyer willing to maintain middle-income status</header><clause id="PE673C4894CA64BC78205801F2D241CAB"><enum>(i)</enum><header>In general</header><text>The extended use period for any building shall terminate on the date the building is acquired by foreclosure (or instrument in lieu of foreclosure) unless the Secretary determines that such acquisition is part of an arrangement with the taxpayer a purpose of which is to terminate such period.</text></clause><clause id="P9185D6AC7BD7461692494D42D55480E1"><enum>(ii)</enum><header>Eviction, etc., of existing middle-income tenants not permitted</header><text>The termination of an extended use period under clause (i) shall not be construed to permit before the close of the 3-year period following such termination—</text><subclause id="P0B0D75168B304B6783FA6A37D7B5A50E"><enum>(I)</enum><text>the eviction or the termination of tenancy (other than for good cause) of an existing tenant of any middle-income unit, or</text></subclause><subclause id="P8C73D15E03934541B85B3C65ECECE144"><enum>(II)</enum><text>any increase in the gross rent with respect to such unit not otherwise permitted under this section.</text></subclause></clause></subparagraph><subparagraph id="P2035BECD10F8465CBA82750A67E4861C"><enum>(F)</enum><header>Effect of noncompliance</header><text>If, during a taxable year, there is a determination that an extended middle-income housing agreement was not in effect as of the beginning of such year, such determination shall not apply to any period before such year and subparagraph (A) shall be applied without regard to such determination if the failure is corrected within 1 year from the date of the determination.</text></subparagraph><subparagraph id="idF7361C979DD64EA893FAF64B67685784"><enum>(G)</enum><header>Projects which consist of more than 1 building</header><text>The application of this paragraph to projects which consist of more than 1 building shall be made under regulations prescribed by the Secretary.</text></subparagraph></paragraph><paragraph id="P2437B3BD6EA449E49CDC0976A0BF5729"><enum>(6)</enum><header>Special rules</header><subparagraph id="P02AF91EC721640ECB2559F5BAF6328DC"><enum>(A)</enum><header>Building must be located within jurisdiction of credit agency</header><text>A housing credit agency may allocate its aggregate housing credit dollar amount only to buildings located in the jurisdiction of the governmental unit of which such agency is a part.</text></subparagraph><subparagraph id="PCF1DA4546E0A473CB9C26836E97DB460"><enum>(B)</enum><header>Agency allocations in excess of limit</header><text>If the aggregate housing credit dollar amounts allocated by a housing credit agency for any calendar year exceed the portion of the State housing credit ceiling allocated to such agency for such calendar year, the housing credit dollar amounts so allocated shall be reduced (to the extent of such excess) for buildings in the reverse of the order in which the allocations of such amounts were made.</text></subparagraph><subparagraph id="PA141A750B3994B458E5EE11664914AB1"><enum>(C)</enum><header>Credit reduced if allocated credit dollar amount is less than credit which would be allowable without regard to placed in service convention, etc</header><clause id="P6A1C7270AFDE4CF3A6F61089D2D62B63"><enum>(i)</enum><header>In general</header><text>The amount of the credit determined under this section with respect to any building shall not exceed the clause (ii) percentage of the amount of the credit which would (but for this subparagraph) be determined under this section with respect to such building.</text></clause><clause id="PDE73839CC4AF40EF87E75421637593DD"><enum>(ii)</enum><header>Determination of percentage</header><text>For purposes of clause (i), the clause (ii) percentage with respect to any building is the percentage which—</text><subclause id="P1A7CA4DAB7B64829A9CC164D42292A52"><enum>(I)</enum><text>the housing credit dollar amount allocated to such building, bears to</text></subclause><subclause id="PDBDF603A94F84372AB6900A99B94B007"><enum>(II)</enum><text>the credit amount determined in accordance with clause (iii).</text></subclause></clause><clause id="P4E869EF1CB234A84B95907690BAE28A3"><enum>(iii)</enum><header>Determination of credit amount</header><text>The credit amount determined in accordance with this clause is the amount of the credit which would (but for this subparagraph) be determined under this section with respect to the building if—</text><subclause id="P5DD783004AF7433DA552263DA284F1D5"><enum>(I)</enum><text>this section were applied without regard to paragraphs (2)(A) and (3)(B) of subsection (f), and</text></subclause><subclause id="P169B741C581A4D2E85D4D646E10708ED"><enum>(II)</enum><text>subsection (f)(3)(A) were applied without regard to <quote>the percentage equal to <fraction>2/3</fraction> of</quote>.</text></subclause></clause></subparagraph><subparagraph id="P5BA5F508EEA34308BB412DC0BFB982C1"><enum>(D)</enum><header>Housing credit agency to specify applicable percentage and maximum qualified basis</header><text>In allocating a housing credit dollar amount to any building, the housing credit agency shall specify the applicable percentage and the maximum qualified basis which may be taken into account under this section with respect to such building. The applicable percentage and maximum qualified basis so specified shall not exceed the applicable percentage and qualified basis determined under this section without regard to this subsection.</text></subparagraph></paragraph><paragraph id="idFE8A97CE1809405D9095E5653B5BD4DC"><enum>(7)</enum><header>Increase in State ceiling dedicated to certain rural development projects</header><subparagraph id="idF5EA08CAABDD4C2AA20159D36003734A"><enum>(A)</enum><header>In general</header><text>The State housing credit ceiling for any calendar year shall be increased by an amount equal to 5 percent of the amount determined under paragraph (3)(C)(i).</text></subparagraph><subparagraph id="id28C50269B09E4BE3B20AE854053336FA"><enum>(B)</enum><header>Use of increased amount</header><text>The amount of the increase under subparagraph (A) for any calendar year may only be allocated to buildings located in a rural area (as defined in section 42(d)(5)(B)(iii)(IV)).</text></subparagraph></paragraph><paragraph id="P031483DC46204B7C8C6177E0D07E63FE"><enum>(8)</enum><header>Other definitions</header><text>For purposes of this subsection—</text><subparagraph id="P0BDDEB737D5243CC87F92E49D92811B1"><enum>(A)</enum><header>Housing credit agency</header><text>The term <term>housing credit agency</term> means any agency authorized to carry out this subsection.</text></subparagraph><subparagraph id="P70C82B1701CD4004A682C2F03C45B484"><enum>(B)</enum><header>Possessions treated as States</header><text>The term <term>State</term> includes a possession of the United States.</text></subparagraph></paragraph><paragraph id="id170a3f9b00db40be98a4f7d17c9c48ac"><enum>(9)</enum><header>Credit for buildings financed by tax-exempt bonds subject to volume cap not taken into account</header><text>Rules similar to the rules of subsections (h)(4), (m)(1)(D), and (m)(2)(D) of section 42 shall apply for purposes of this subsection.</text></paragraph></subsection><subsection id="PA5F7C64B316C4F55A30725B482E46DBC"><enum>(i)</enum><header>Definitions and special rules</header><text>For purposes of this section—</text><paragraph id="P9BCE9A7CBCEA428A96C3E7AED124389D"><enum>(1)</enum><header>Middle-income unit</header><subparagraph id="PF8A277B42E0E454380F103ABCC35A3B6"><enum>(A)</enum><header>In general</header><text>The term <term>middle-income unit</term> means any unit in a building if—</text><clause id="P5DE8F5E2CE1A4497B0BD4FFA6ECFA675"><enum>(i)</enum><text>such unit is rent-restricted (as defined in subsection (g)(2)), and</text></clause><clause id="P98E4E3F1F2CB4BAF841F9293B551BEEE"><enum>(ii)</enum><text>the individuals occupying such unit meet the income limitation applicable under subsection (g)(1) to the project of which such building is a part.</text></clause></subparagraph><subparagraph id="PBE0E3E80E192467EAAE57CF59E5094A4"><enum>(B)</enum><header>Exceptions</header><clause id="id7F6FDB7879C948F5A189A2A1599CF5FB"><enum>(i)</enum><header>Exclusion of low-income units</header><text>A unit shall not be treated as a middle-income unit if such unit is a low-income unit (as defined under section 42(i)(3)).</text></clause><clause id="P4CF047859F6440939DB0CC6C691396A4"><enum>(ii)</enum><header>Unit must be suitable for permanent occupancy</header><subclause id="idE4443952AA4C42119ECCA81E5D7AD626"><enum>(I)</enum><header>In general</header><text>A unit shall not be treated as a middle-income unit unless the unit is suitable for occupancy and used other than on a transient basis.</text></subclause><subclause id="P3C3476DBE64E4E56AC20F8E6C84811E8"><enum>(II)</enum><header>Suitability for occupancy</header><text>For purposes of subclause (I), the suitability of a unit for occupancy shall be determined under regulations prescribed by the Secretary taking into account local health, safety, and building codes.</text></subclause><subclause id="P54C57B9D251D4F2896FBB94B6F3F2ECB"><enum>(III)</enum><header>Single-room occupancy units</header><text>For purposes of subclause (I), a single-room occupancy unit shall not be treated as used on a transient basis merely because it is rented on a month-by-month basis.</text></subclause></clause></subparagraph><subparagraph id="P73FFF9722BCA4A6CA6C98D89AD7A0BB1"><enum>(C)</enum><header>Special rule for buildings having 4 or fewer units</header><text>In the case of any building which has 4 or fewer residential rental units, no unit in such building shall be treated as a middle-income unit if the units in such building are owned by—</text><clause id="P703D8F306FBE46EDA8481C6C9DD3093B"><enum>(i)</enum><text>any individual who occupies a residential unit in such building, or</text></clause><clause id="P7C31716DF7BD403494BC56CB0F94ACC6"><enum>(ii)</enum><text>any person who is related (as defined in subsection (d)(2)(D)(ii)) to such individual.</text></clause></subparagraph><subparagraph id="id609F906EF1254358A00D3203FE3BFD7F"><enum>(D)</enum><header>Rules relating to students</header><clause id="id4E323C3B27B54C049B9E9C13537737A1"><enum>(i)</enum><header>In general</header><text>A unit occupied solely by individuals who—</text><subclause id="id14E8094C3C5749C29939FDDEEF005324"><enum>(I)</enum><text>have not attained age 24, and</text></subclause><subclause id="idE4850C73A2BC4519BA3F6F2F9DFAB28E"><enum>(II)</enum><text>are enrolled in a full-time course of study at an institution of higher education (as defined in section 3304(f)),</text></subclause><continuation-text continuation-text-level="clause">shall not be treated as a middle-income unit.</continuation-text></clause><clause id="id30452193A59543C5853EDE32BBB839E4"><enum>(ii)</enum><header>Exceptions</header><text>Clause (i) shall not apply to a unit occupied by an individual who—</text><subclause id="idB66D5A99CD9A4FB1899AAF3EE7422A6C"><enum>(I)</enum><text>is married, if such individual's spouse also occupies the unit,</text></subclause><subclause id="id0CE0C46AF162417B8DED9043C8099A6E"><enum>(II)</enum><text>is a person with disabilities (as defined in section 3(b)(3)(E) of the United States Housing Act of 1937),</text></subclause><subclause id="idD9C41D773A134A1AB3183D4902B6E507"><enum>(III)</enum><text>is a veteran (as defined in section 101(2) of title 38, United States Code),</text></subclause><subclause id="id41CD8E038B0D4146B0ACCC869906435C"><enum>(IV)</enum><text>has one or more qualifying children (as defined in section 152(c)), if such children also occupy the unit, the individual is not a dependent (as defined in section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof) of another individual, and such children are not claimed as dependents (as so defined) of another individual, or</text></subclause><subclause id="id66930E81D66E4C4C86AC8B499673439C"><enum>(V)</enum><text>is, or was immediately prior to attaining the age of majority—</text><item id="id13A8DD4F2B224BDABBBA8D741CE536BC"><enum>(aa)</enum><text>an emancipated minor or in legal guardianship as determined by a court of competent jurisdiction in the individual's State of legal residence,</text></item><item commented="no" display-inline="no-display-inline" id="id58E36C0BE53B4D9087FC0C5A27D99AFB"><enum>(bb)</enum><text display-inline="yes-display-inline">under the care and placement responsibility of the State agency responsible for administering a plan under part B or part E of title IV of the Social Security Act, or</text></item><item id="id704ED69DE88C41FC9610D263F6E6FD43"><enum>(cc)</enum><text>was an unaccompanied youth (within the meaning of section 725(6) of the McKinney-Vento Homeless Assistance Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11434a">42 U.S.C. 11434a(6)</external-xref>)) or a homeless child or youth (within the meaning of section 725(2) of such Act (<external-xref legal-doc="usc" parsable-cite="usc/42/11434a">42 U.S.C. 11434a(2)</external-xref>)).</text></item></subclause></clause></subparagraph><subparagraph id="PEC945E6C266B4EC0B975ADDE57A2745F"><enum>(E)</enum><header>Owner-occupied buildings having 4 or fewer units eligible for credit where development plan</header><clause id="PFB89A39AF6CA4083A184F84E2281B2E2"><enum>(i)</enum><header>In general</header><text>Subparagraph (C) shall not apply to the acquisition or rehabilitation of a building pursuant to a development plan of action sponsored by a State or local government or a qualified nonprofit organization.</text></clause><clause id="PD324B6153F3D4C8C93EE08D90445A597"><enum>(ii)</enum><header>Limitation on credit</header><text>In the case of a building to which clause (i) applies, the applicable fraction shall not exceed 80 percent of the unit fraction.</text></clause><clause id="PC4DA06A21A8448B2AAE05D29A0042BAF"><enum>(iii)</enum><header>Certain unrented units treated as owner-occupied</header><text>In the case of a building to which clause (i) applies, any unit which is not rented for 90 days or more shall be treated as occupied by the owner of the building as of the 1st day it is not rented.</text></clause></subparagraph></paragraph><paragraph id="PAD2FA225AAA143E58BD6617D860785F6"><enum>(2)</enum><header>New building</header><text>The term <term>new building</term> means a building the original use of which begins with the taxpayer.</text></paragraph><paragraph id="P0019648C131F4212B22321490DBFC8C4"><enum>(3)</enum><header>Existing building</header><text>The term <term>existing building</term> means any building which is not a new building.</text></paragraph><paragraph id="PBBBB2EC092CD4B9DA0748C62B176A1EC"><enum>(4)</enum><header>Application to estates and trusts</header><text>In the case of an estate or trust, the amount of the credit determined under subsection (a) shall be apportioned between the estate or trust and the beneficiaries on the basis of the income of the estate or trust allocable to each.</text></paragraph><paragraph id="P4C1C51B0154E46B18F140C1EB57AFA24"><enum>(5)</enum><header>Impact of tenant's option to acquire property</header><subparagraph id="P2683EFAF16F942DD8F505DCE6CA46CED"><enum>(A)</enum><header>In general</header><text>No Federal income tax benefit shall fail to be allowable to the taxpayer with respect to any qualified middle-income building merely by reason of an option held by the tenants (in cooperative form or otherwise) or resident management corporation of such building or by a qualified nonprofit organization or government agency to purchase the property or all of the partnership interests (other than interests of the person exercising such option or a related party thereto (within the meaning of section 267(b) or 707(b)(1))) relating to the property after the close of the credit period for a price which is not less than the minimum purchase price determined under subparagraph (B).</text></subparagraph><subparagraph id="P6CF17BD5E8394A8A9BD5863866F44AC3"><enum>(B)</enum><header>Minimum purchase price</header><text>For purposes of subparagraph (A), the minimum purchase price under this subparagraph is an amount equal to the principal amount of outstanding indebtedness secured by the building (other than indebtedness incurred within the 5-year period ending on the date of the sale to the tenants). In the case of a purchase of a partnership interest, the minimum purchase price is an amount equal to such interest's ratable share of the amount determined under the preceding sentence.</text></subparagraph></paragraph><paragraph id="PE62AE073E64349AEA5B4A4DA55FF59F9"><enum>(6)</enum><header>Treatment of rural projects</header><text>For purposes of this section, in the case of any project for residential rental property located in a rural area (as defined in section 520 of the Housing Act of 1949), any income limitation measured by reference to area median gross income shall be measured by reference to the greater of area median gross income or national non-metropolitan median income.</text></paragraph><paragraph id="idecb1183153154905aa670b0a64ee33fb"><enum>(7)</enum><header>Determination of whether building is Federally subsidized</header><subparagraph id="id17cc1afe80da4feca08c6d98750270ab"><enum>(A)</enum><header>In general</header><text>Except as otherwise provided in this paragraph, for purposes of this section, a project shall be treated as Federally subsidized for any taxable year if, at any time during such taxable year or any prior taxable year, there is or was outstanding any obligation the interest on which is exempt from tax under section 103 the proceeds of which are or were used (directly or indirectly) with respect to such project or the operation thereof.</text></subparagraph><subparagraph commented="no" id="id281af838e91744b9883fbe84cb15316a"><enum>(B)</enum><header>Special rule for subsidized construction financing</header><text>Subparagraph (A) shall not apply to any tax-exempt obligation used to provide construction financing for any building if—</text><clause commented="no" id="id71bcc4607d0947c689e7da902bd9fae4"><enum>(i)</enum><text>such obligation (when issued) identified the building for which the proceeds of such obligation would be used, and</text></clause><clause commented="no" id="id7137464853bd46e39a515838f239134b"><enum>(ii)</enum><text>such obligation is redeemed before such building is placed in service.</text></clause></subparagraph></paragraph><paragraph commented="no" id="id254DB8E0D09B4314A48250EA8D05F8FF"><enum>(8)</enum><header>Reduction in basis</header><text>In the case of any building for which a credit is allowable under this section and section 42, the basis of the building shall be reduced by the amount of such credit allowed under subsection (a).</text></paragraph></subsection><subsection id="P025A3ABE10534D619AA032CC6F9AAEEA"><enum>(j)</enum><header>Application of at-Risk rules</header><text>For purposes of this section—</text><paragraph id="P4419E685EA50451FB11344E95F4B7908"><enum>(1)</enum><header>In general</header><text>Except as otherwise provided in this subsection, rules similar to the rules of section 49(a)(1) (other than subparagraphs (D)(ii)(II) and (D)(iv)(I) thereof), section 49(a)(2), and section 49(b)(1) shall apply in determining the qualified basis of any building in the same manner as such sections apply in determining the credit base of property.</text></paragraph><paragraph commented="no" id="PA277FF2BA8834EB3A979255DD69402E2"><enum>(2)</enum><header>Special rules for determining qualified person</header><text>For purposes of paragraph (1)—</text><subparagraph commented="no" id="P3D0A9765CCCD43A99DA2968A157C9FE3"><enum>(A)</enum><header>In general</header><text>If the requirements of subparagraphs (B), (C), and (D) are met with respect to any financing borrowed from a qualified nonprofit organization, the determination of whether such financing is qualified commercial financing with respect to any qualified middle-income building shall be made without regard to whether such organization—</text><clause commented="no" id="PA01810B2688C4ACE9F75B44F48889346"><enum>(i)</enum><text>is actively and regularly engaged in the business of lending money, or</text></clause><clause commented="no" id="PC78A2D756AED407B9228AC5E81A7117E"><enum>(ii)</enum><text>is a person described in section 49(a)(1)(D)(iv)(II).</text></clause></subparagraph><subparagraph commented="no" id="PAEEA273DEA52457395D3E212C68B0235"><enum>(B)</enum><header>Financing secured by property</header><text>The requirements of this subparagraph are met with respect to any financing if such financing is secured by the qualified middle-income building, except that this subparagraph shall not apply in the case of a federally assisted building described in subsection (d)(5)(B) if—</text><clause commented="no" id="PAEB624B65F8E4E77A256B708646A849E"><enum>(i)</enum><text>a security interest in such building is not permitted by a Federal agency holding or insuring the mortgage secured by such building, and</text></clause><clause commented="no" id="P9E0B810A67734318A68E25755DEFB732"><enum>(ii)</enum><text>the proceeds from the financing (if any) are applied to acquire or improve such building.</text></clause></subparagraph><subparagraph commented="no" id="PA2F80970F57C4C258A9C6C1E8962A438"><enum>(C)</enum><header>Portion of building attributable to financing</header><text>The requirements of this subparagraph are met with respect to any financing for any taxable year in the credit period if, as of the close of such taxable year, not more than 60 percent of the eligible basis of the qualified middle-income building is attributable to such financing (reduced by the principal and interest of any governmental financing which is part of a wrap-around mortgage involving such financing).</text></subparagraph><subparagraph commented="no" id="P62C62EC288D6414D9299A9C748D43C25"><enum>(D)</enum><header>Repayment of principal and interest</header><text>The requirements of this subparagraph are met with respect to any financing if such financing is fully repaid on or before the earliest of—</text><clause commented="no" id="PBCC36EBD7F0544C4BB7524BF556DC428"><enum>(i)</enum><text>the date on which such financing matures,</text></clause><clause commented="no" id="P66981666C59F4283997B242D089D5609"><enum>(ii)</enum><text>the 90th day after the close of the credit period with respect to the qualified middle-income building, or</text></clause><clause commented="no" id="P7FDCEE31E62B42639F8596B7E4005062"><enum>(iii)</enum><text>the date of its refinancing or the sale of the building to which such financing relates.</text></clause><continuation-text commented="no" continuation-text-level="subparagraph">In the case of a qualified nonprofit organization which is not described in section 49(a)(1)(D)(iv)(II) with respect to a building, clause (ii) of this subparagraph shall be applied as if the date described therein were the 90th day after the earlier of the date the building ceases to be a qualified middle-income building or the date which is 15 years after the close of a credit period with respect thereto.</continuation-text></subparagraph></paragraph><paragraph commented="no" id="PC633F8E355C04929B62225E9167C50DB"><enum>(3)</enum><header>Present value of financing</header><text>If the rate of interest on any financing described in paragraph (2)(A) is less than the rate which is 1 percentage point below the applicable Federal rate as of the time such financing is incurred, then the qualified basis (to which such financing relates) of the qualified middle-income building shall be the present value of the amount of such financing, using as the discount rate such applicable Federal rate. For purposes of the preceding sentence, the rate of interest on any financing shall be determined by treating interest to the extent of government subsidies as not payable.</text></paragraph><paragraph commented="no" id="PADC28441BF36464E833537D1C893A95E"><enum>(4)</enum><header>Failure to fully repay</header><subparagraph commented="no" id="P8573CCE5988E4C95A48899FF8E537D0C"><enum>(A)</enum><header>In general</header><text>To the extent that the requirements of paragraph (2)(D) are not met, then the taxpayer's tax under this chapter for the taxable year in which such failure occurs shall be increased by an amount equal to the applicable portion of the credit under this section with respect to such building, increased by an amount of interest for the period—</text><clause commented="no" id="PE67B3F6A1A234AD7A78E0E69B0800EE1"><enum>(i)</enum><text>beginning with the due date for the filing of the return of tax imposed by chapter 1 for the 1st taxable year for which such credit was allowable, and</text></clause><clause commented="no" id="P1BC7E1245302444BAD660E3EBCAFABAA"><enum>(ii)</enum><text>ending with the due date for the taxable year in which such failure occurs,</text></clause><continuation-text commented="no" continuation-text-level="subparagraph">determined by using the underpayment rate and method under section 6621.</continuation-text></subparagraph><subparagraph commented="no" id="P6F035BA9BB7E43249B4FC64AB60238BC"><enum>(B)</enum><header>Applicable portion</header><text>For purposes of subparagraph (A), the term <term>applicable portion</term> means the aggregate decrease in the credits allowed to a taxpayer under section 38 for all prior taxable years which would have resulted if the eligible basis of the building were reduced by the amount of financing which does not meet requirements of paragraph (2)(D).</text></subparagraph><subparagraph commented="no" id="P70F20BC556D2472C8D102CE867EF2404"><enum>(C)</enum><header>Certain rules to apply</header><text>Rules similar to the rules of subparagraphs (A) and (D) of section 42(j)(4) shall apply for purposes of this subsection.</text></subparagraph></paragraph></subsection><subsection id="P32654313A87D4F49894592A966D4D3C2"><enum>(k)</enum><header>Certifications and other reports to Secretary</header><paragraph id="P6141E3934E44433A9A8D565FC97FA139"><enum>(1)</enum><header>Certification with respect to 1st year of credit period</header><text>Following the close of the 1st taxable year in the credit period with respect to any qualified middle-income building, the taxpayer shall certify to the Secretary (at such time and in such form and in such manner as the Secretary prescribes)—</text><subparagraph id="P34E0F9CE01274B8FAA27CCF52C64FF1D"><enum>(A)</enum><text>the taxable year, and calendar year, in which such building was placed in service,</text></subparagraph><subparagraph id="PEFDCB31C3AAF4BF3A8ED356155ED8B62"><enum>(B)</enum><text>the adjusted basis and eligible basis of such building as of the close of the 1st year of the credit period,</text></subparagraph><subparagraph id="P90B9601DFBA744F99A5B580F2BAB0D19"><enum>(C)</enum><text>the maximum applicable percentage and qualified basis permitted to be taken into account by the appropriate housing credit agency under subsection (h), and</text></subparagraph><subparagraph id="P81D34B198FC2415793B42B8477789C30"><enum>(D)</enum><text>such other information as the Secretary may require.</text></subparagraph><continuation-text continuation-text-level="paragraph">In the case of a failure to make the certification required by the preceding sentence on the date prescribed therefor, unless it is shown that such failure is due to reasonable cause and not to willful neglect, no credit shall be allowable by reason of subsection (a) with respect to such building for any taxable year ending before such certification is made.</continuation-text></paragraph><paragraph id="PAEA9B7CB43464391B54836D8F6CA3FFD"><enum>(2)</enum><header>Annual reports to the Secretary</header><text>The Secretary may require taxpayers to submit an information return (at such time and in such form and manner as the Secretary prescribes) for each taxable year setting forth—</text><subparagraph id="PA0D4F109ACD1484BA080E5E8C37C0C03"><enum>(A)</enum><text>the qualified basis for the taxable year of each qualified middle-income building of the taxpayer,</text></subparagraph><subparagraph id="PF85F9D868076444E993CA6E5341B4A06"><enum>(B)</enum><text>the information described in paragraph (1)(C) for the taxable year, and</text></subparagraph><subparagraph id="P108E3BA63A734D3194AC26B0E5EED1EF"><enum>(C)</enum><text>such other information as the Secretary may require.</text></subparagraph><continuation-text continuation-text-level="paragraph">The penalty under section 6652(j) shall apply to any failure to submit the return required by the Secretary under the preceding sentence on the date prescribed therefor.</continuation-text></paragraph><paragraph id="P20AA57A69DEB4474867E04896B3B3CE1"><enum>(3)</enum><header>Annual reports from housing credit agencies</header><text>Each agency which allocates any housing credit amount to any building for any calendar year shall submit to the Secretary (at such time and in such manner as the Secretary shall prescribe) an annual report specifying—</text><subparagraph id="P9F13275713A54E33A8F2C142CFF72B6F"><enum>(A)</enum><text>the amount of housing credit amount allocated to each building for such year,</text></subparagraph><subparagraph id="P689076B510F444DEAFA69C5D5B820702"><enum>(B)</enum><text>sufficient information to identify each such building and the taxpayer with respect thereto, and</text></subparagraph><subparagraph id="PBD8F5839BBEC43A3822430590C95B7D0"><enum>(C)</enum><text>such other information as the Secretary may require.</text></subparagraph><continuation-text continuation-text-level="paragraph">The penalty under section 6652(j) shall apply to any failure to submit the report required by the preceding sentence on the date prescribed therefor.</continuation-text></paragraph></subsection><subsection id="P770257F6E5414B0C89A1EBB6F23ACA96"><enum>(l)</enum><header>Responsibilities of housing credit agencies</header><paragraph id="P6FFFC2634D9B47B0B2005A9B9B8ACB7E"><enum>(1)</enum><header>Plans for allocation of credit among projects</header><subparagraph id="P22CCBE7A051E4D45A367A6223BA5B5C7"><enum>(A)</enum><header>In general</header><text>Notwithstanding any other provision of this section, the housing credit dollar amount with respect to any building shall be zero unless—</text><clause id="P6AEFCFDC16524321A92323115C9D7934"><enum>(i)</enum><text>such amount was allocated pursuant to a qualified allocation plan of the housing credit agency which is approved by the governmental unit (in accordance with rules similar to the rules of section 42(m)(1)) of which such agency is a part,</text></clause><clause id="P6AA01954327D41F0961B2977CCF261E9"><enum>(ii)</enum><text>a comprehensive market study of the housing needs of middle-income individuals in the area to be served by the project is conducted before the credit allocation is made and at the developer's expense by a disinterested party who is approved by such agency, and</text></clause><clause id="PFB8D09EE7F67454F9BF08F6D3F41D55A"><enum>(iii)</enum><text>a written explanation is available to the general public for any allocation of a housing credit dollar amount which is not made in accordance with established priorities and selection criteria of the housing credit agency.</text></clause></subparagraph><subparagraph id="P961D5DE114E242C8AF8DC151B8791E39"><enum>(B)</enum><header>Qualified allocation plan</header><text>For purposes of this paragraph, the term <term>qualified allocation plan</term> means any plan—</text><clause id="PAECB67FACC4D47C4BC19129ABE9B2CB6"><enum>(i)</enum><text>which sets forth selection criteria to be used to determine housing priorities of the housing credit agency which are appropriate to local conditions,</text></clause><clause id="PDB7AE93DA4AD4A4CB37370B5EA4EE080"><enum>(ii)</enum><text>which also gives preference in allocating housing credit dollar amounts among selected projects to—</text><subclause id="P9444A4535EB2456483077B2422389B7B"><enum>(I)</enum><text>projects obligated to serve qualified tenants for the longest periods,</text></subclause><subclause id="id85E9B83F74D84C5CA1A7C43D24231844"><enum>(II)</enum><text>projects in areas where rents are unaffordable to median income households,</text></subclause><subclause id="id44A86F6F16134FD08A7099F8A15F5DBA"><enum>(III)</enum><text>projects which target housing to tenants at a range of incomes between 60 and 100 percent of area median gross income, and</text></subclause><subclause id="id563B38E30AA54549AE299589C84330AB"><enum>(IV)</enum><text>projects located near transit hubs, and</text></subclause></clause><clause id="P0EE40C3982A247E3B419DB1EB096385F"><enum>(iii)</enum><text>which provides a procedure that the agency (or an agent or other private contractor of such agency) will follow in monitoring for noncompliance with the provisions of this section and in notifying the Internal Revenue Service of such noncompliance which such agency becomes aware of and in monitoring for noncompliance with habitability standards through regular site visits.</text></clause></subparagraph><subparagraph id="P616D567C395F4846AE95DC91AE92F224"><enum>(C)</enum><header>Certain selection criteria must be used</header><text>The selection criteria set forth in a qualified allocation plan must include—</text><clause id="P17A67A6F3C464F9DADC1335FF44E2CB0"><enum>(i)</enum><text>project location,</text></clause><clause id="PC9A6136081C74AB1A1D421496E983318"><enum>(ii)</enum><text>housing needs characteristics,</text></clause><clause id="P0DAE5B88639147ABAFE8CAFBDA88A14F"><enum>(iii)</enum><text>project characteristics, including whether the project includes the use of existing housing as part of a community revitalization plan,</text></clause><clause id="PFC0D8E6E02F649A1A710752C7C7B8343"><enum>(iv)</enum><text>sponsor characteristics,</text></clause><clause id="P768B7E5E5B04499EB81550D0ECF79180"><enum>(v)</enum><text>tenant populations with special housing needs,</text></clause><clause id="PBC6DAA88ACD64CDF9C204493AC3A8602"><enum>(vi)</enum><text>tenant populations of individuals with children,</text></clause><clause id="PEE1A11C2EDF14277BAD5A01AF0554729"><enum>(vii)</enum><text>projects intended for eventual tenant ownership,</text></clause><clause id="PCDD8EF0837C14A63A90CCE062BD37B1D"><enum>(viii)</enum><text>the energy efficiency of the project, and</text></clause><clause id="PCD47AC7A3A9245018E49BD3AA7521F44"><enum>(ix)</enum><text>the historic nature of the project.</text></clause></subparagraph><subparagraph id="idF1FBA21ECF9044E5AF3F30CAC787A4FD"><enum>(D)</enum><header>Certain selection criteria prohibited</header><text>The selection criteria set forth in a qualified allocation plan shall not include a requirement of local approval or local contributions, either as a threshold qualification requirement or as part of a point system to be considered for allocations of housing credit dollar amount.</text></subparagraph></paragraph><paragraph id="PA0A8FD279E5B4C158047FD544EC8607D"><enum>(2)</enum><header>Credit allocated to building not to exceed amount necessary to assure project feasibility</header><subparagraph id="P541CA7FBCBE6492DB5E82363274AC3E5"><enum>(A)</enum><header>In general</header><text>The housing credit dollar amount allocated to a project shall not exceed the amount the housing credit agency determines is necessary for the financial feasibility of the project and its viability as a qualified middle-income housing project throughout the credit period.</text></subparagraph><subparagraph id="P1439A2232B9848E68590E5ED1C2B5304"><enum>(B)</enum><header>Agency evaluation</header><text>In making the determination under subparagraph (A), the housing credit agency shall consider—</text><clause id="PD1C3ADC4207242869C7DFA39825C2F2C"><enum>(i)</enum><text>the sources and uses of funds and the total financing planned for the project,</text></clause><clause id="P1543410F12474FCFA40C518A94CA8CBF"><enum>(ii)</enum><text>any proceeds or receipts expected to be generated by reason of tax benefits,</text></clause><clause id="PB933C7C57C8344308187F24C1AD8092B"><enum>(iii)</enum><text>the percentage of the housing credit dollar amount used for project costs other than the cost of intermediaries, and</text></clause><clause id="PDE63F626DC3D4F6D88F50E1B3F7A4B65"><enum>(iv)</enum><text>the reasonableness of the developmental and operational costs of the project.</text></clause><continuation-text continuation-text-level="subparagraph">Clause (iii) shall not be applied so as to impede the development of projects in hard-to-develop areas. Such a determination shall not be construed to be a representation or warranty as to the feasibility or viability of the project.</continuation-text></subparagraph><subparagraph id="P913850CBB6C24989A878B3C0A1F9F213"><enum>(C)</enum><header>Determination made when credit amount applied for and when building placed in service</header><clause id="P872061AF588C47FF9387D001B9002775"><enum>(i)</enum><header>In general</header><text>A determination under subparagraph (A) shall be made as of each of the following times:</text><subclause id="P073B90B26DC24E2F91C2FD060B9F9FD8"><enum>(I)</enum><text>The application for the housing credit dollar amount.</text></subclause><subclause id="P18C1322703FA4FBCB6E248C92DE1B0CD"><enum>(II)</enum><text>The allocation of the housing credit dollar amount.</text></subclause><subclause id="P39DFC92A6ED44855A3E4D3A3D1915FF4"><enum>(III)</enum><text>The date the building is placed in service.</text></subclause></clause><clause id="PAA94598A5081419FA51CA5663ED1DA9C"><enum>(ii)</enum><header>Certification as to amount of other subsidies</header><text>Prior to each determination under clause (i), the taxpayer shall certify to the housing credit agency the full extent of all Federal, State, and local subsidies which apply (or which the taxpayer expects to apply) with respect to the building.</text></clause></subparagraph></paragraph></subsection><subsection id="P0FBDAD8CAD7C436DB9A94C32A172E7AD"><enum>(m)</enum><header>Regulations</header><text>The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section, including regulations—</text><paragraph id="PFEFD2E1542D2488A8903FE04799A66C7"><enum>(1)</enum><text>dealing with—</text><subparagraph id="P86FD946C3FE0424D85787E3E5D0BC339"><enum>(A)</enum><text>projects which include more than 1 building or only a portion of a building, or</text></subparagraph><subparagraph id="PC03456920B404EB3AB1E2B8471F37D9F"><enum>(B)</enum><text>buildings which are placed in service in portions,</text></subparagraph></paragraph><paragraph id="P8AFE494DE51C4B0B917655BCFDF8B6A0"><enum>(2)</enum><text>providing for the application of this section to short taxable years,</text></paragraph><paragraph id="P1A9BB222C44947B69A5E85E9302241E2"><enum>(3)</enum><text>preventing the avoidance of the rules of this section, and</text></paragraph><paragraph id="PDFFEB9860E2B4706A7F8300BA46E079E"><enum>(4)</enum><text>providing the opportunity for housing credit agencies to correct administrative errors and omissions with respect to allocations and record keeping within a reasonable period after their discovery, taking into account the availability of regulations and other administrative guidance from the Secretary.</text></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="id16400655A36C4E4089A4E1C5FA073310"><enum>(b)</enum><header>Treatment as part of general business credit</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/38">Section 38(b)</external-xref> of the Internal Revenue Code of 1986 is amended by striking <quote>plus</quote> at the end of paragraph (32), by striking the period at the end of paragraph (33) and inserting <quote>, plus</quote>, and by adding at the end the following new paragraph:</text><quoted-block style="OLC" display-inline="no-display-inline" id="id1c46a784b96e4739ba3e3324275faac9"><paragraph id="id9754e245a2754d2d86074b8dc7da39b9"><enum>(34)</enum><text>the middle-income housing credit determined under section 42A(a).</text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="idB3948E604B794644A899FB1FDA4B6EA5"><enum>(c)</enum><header>Unused allocations carried over to low-Income housing credit</header><paragraph id="idBFBA6C0324D846C8B515F4117E02694F"><enum>(1)</enum><header>In general</header><text>Clause (i) of <external-xref legal-doc="usc" parsable-cite="usc/26/42">section 42(h)(3)(C)</external-xref> of the Internal Revenue Code of 1986 is amended—</text><subparagraph id="id53811B0F42A64E7182E218A4477C35EA"><enum>(A)</enum><text>by striking <quote>the unused</quote> and inserting</text><quoted-block style="OLC" display-inline="yes-display-inline" id="id3F628938456D4BB0B3ED7C33B3AD1EDB"><text>the sum of—</text><subclause id="idCF0D058D53F6438C891731723AECC2F3"><enum>(I)</enum><text>the unused</text></subclause><after-quoted-block>,</after-quoted-block></quoted-block></subparagraph><subparagraph id="id0190CBE4205D43F581B29225CED6B28A"><enum>(B)</enum><text>by inserting <quote>plus</quote> after <quote>calendar year,</quote>, and</text></subparagraph><subparagraph id="idA048E48D920F417D9A9A09AE1B4C81E0"><enum>(C)</enum><text>by adding at the end the following new subclause:</text><quoted-block style="OLC" display-inline="no-display-inline" id="id81F9DF8CC0AA4CD88140DDE03959C140"><subclause id="idF462FFB9EB3A4D13A4928AE4A65913BB"><enum>(II)</enum><text>the unused middle-income State housing credit (if any) of such State for the preceding calendar year,</text></subclause><after-quoted-block>.</after-quoted-block></quoted-block></subparagraph></paragraph><paragraph id="idB1DE68711B7741E2B454C3891C73034B"><enum>(2)</enum><header>Unused middle-income State housing credit</header><text>The second sentence of section 42(h)(3)(C) of such Code is amended by inserting <quote>, and the unused middle-income State housing credit for any calendar year is the excess (if any) of the amount described in section 42A(h)(3)(C) (after application of section 42A(h)(7)) for such State over the aggregate amount of middle-income housing credit dollar amount allocated by such State under section 42A for such year</quote> after <quote>for such year</quote>.</text></paragraph><paragraph id="id7B83C9AC7EC94964ADF9A4FA261EF39F"><enum>(3)</enum><header>Unused middle income State housing credit included in carryover allocation</header><text>Section 42(h)(3)(D)(ii) of such Code is amended—</text><subparagraph id="id9753B208F94C4D649D6338F9E3D95768"><enum>(A)</enum><text>by inserting <quote>the sum of</quote> after <quote>is the excess (if any) of</quote>; and</text></subparagraph><subparagraph id="idAA760205C4584229830A1C9265B01584"><enum>(B)</enum><text>by inserting <quote>plus the unused middle-income State housing credit (as so defined)</quote> after <quote>as defined in subparagraph (C)(i))</quote>.</text></subparagraph></paragraph></subsection><subsection id="id0B77C9F92B404AB183C6A67E7984191D"><enum>(d)</enum><header>Reduction in basis</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/1016">Section 1016(a)</external-xref> of the Internal Revenue Code of 1986 is amended—</text><paragraph id="id2EF1430404374A3893A98A646AD02403"><enum>(1)</enum><text>by striking <quote>and</quote> at the end of paragraph (37);</text></paragraph><paragraph id="id2CAB449ADDB740F68A574F831E44995C"><enum>(2)</enum><text>by redesignating paragraph (38) as paragraph (39); and</text></paragraph><paragraph id="id6615167D4D2749CE915A65377BFE9EF1"><enum>(3)</enum><text>by inserting after paragraph (37) the following new paragraph: </text><quoted-block style="OLC" display-inline="no-display-inline" id="id0FD9E49A08294570B7A0DAA3F2A00D57"><paragraph id="id906C27B395324BD69477E8A8A7DDEF7B"><enum>(38)</enum><text>to the extent provided in section 42A(i)(8), and</text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection id="id509AA88E12A049CD874988B0B04A98BB"><enum>(e)</enum><header>Conforming amendments</header><paragraph commented="no" id="id208A8497CB064E1EA083C04D07D1B533"><enum>(1)</enum><text><external-xref legal-doc="usc" parsable-cite="usc/26/55">Section 55(c)(1)</external-xref> of the Internal Revenue Code of 1986 is amended by inserting <quote>42A(j),</quote> before <quote>45(e)(11)(C)</quote>.</text></paragraph><paragraph id="id1AACE53B757A43349804D8AA8ABABDCC"><enum>(2)</enum><text>Subsections (i)(3)(C), (i)(6)(B)(i), and (k)(1) of section 469 of such Code are each amended by inserting <quote>or 42A</quote> after <quote>42</quote>.</text></paragraph><paragraph id="idF69B56E0FD764A6BB291C8550A31EE6E"><enum>(3)</enum><text>The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 42 the following new item:</text><quoted-block style="OLC" id="id8c1ec9d0-c29e-4100-b2f1-aea25a2be63a"><toc><toc-entry idref="P78C9E79EF8354D92A03EC3D0FB6070E7" level="section">Sec. 42A. Middle-income housing credit.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection id="id4EFF1D166CEE4D2BB44A76BCDB76E5A7" commented="no" display-inline="no-display-inline"><enum>(f)</enum><header>Effective date</header><text>The amendments made by this section shall apply to taxable years ending after the date of the enactment of this Act.</text></subsection></section><section id="H24A7130F73E348E592C626D58DCD2089"><enum>217.</enum><header>Neighborhood homes credit</header><subsection id="H7A63A0B566EC4F4FB2A2F8C62EC7007A"><enum>(a)</enum><header>In general</header><text>Subpart D of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986, as amended by section 216, is further amended by inserting after section 42A the following new section:</text><quoted-block style="OLC" id="H768FC15FD1FD413EB8991CD45CDF5EC0"><section id="HEF90448EBBB04F75BEE804B879C3286D"><enum>42B.</enum><header>Neighborhood homes credit</header><subsection id="HE7AEE3CA628245D9A979FEB1F5A7FB80"><enum>(a)</enum><header>Allowance of credit</header><text>For purposes of section 38, the amount of the neighborhood homes credit determined under this section for a taxable year for a qualified project shall be, with respect to each qualified residence that is part of such qualified project and with respect to which there is a qualified completion event during such taxable year, an amount equal to—</text><paragraph id="H2D1780FD29704B39ACA77ABF9A3E35B7"><enum>(1)</enum><text display-inline="yes-display-inline">in the case of an affordable sale, with respect to the seller, the excess of—</text><subparagraph id="HD275C220834949E38DEF2B251ADDF809"><enum>(A)</enum><text display-inline="yes-display-inline">the qualified development cost incurred by such seller for such qualified residence, over</text></subparagraph><subparagraph id="H349199C65A1B48C9BC98F650AB0E7DBA"><enum>(B)</enum><text display-inline="yes-display-inline">the sale price of such qualified residence, or</text></subparagraph></paragraph><paragraph commented="no" id="HAAC25CB79AB244DCAB615658D62A27DB"><enum>(2)</enum><text display-inline="yes-display-inline">in the case of any rehabilitation described in subsection (f)(5)(B), with respect to a taxpayer other than the owner of the qualified residence (or a related person with respect to such owner), the excess of—</text><subparagraph commented="no" id="H5C120A3636404E0BBA5862FC89CF143A"><enum>(A)</enum><text>the qualified development cost incurred by such taxpayer for such qualified residence, over</text></subparagraph><subparagraph commented="no" id="H24E5B068DE3B45DB9502997D887A7AA3"><enum>(B)</enum><text>the amount received by such taxpayer as payment for such rehabilitation.</text></subparagraph></paragraph></subsection><subsection id="HFAF6A35EBAE8486EAA6B6EF08AF7715A"><enum>(b)</enum><header>Limitations</header><paragraph id="HB1B9C2F15371456EBF58A69EEA75A81C"><enum>(1)</enum><header>Amount</header><text>The amount determined under subsection (a) with respect to a qualified residence shall not exceed 35 percent of the lesser of—</text><subparagraph id="H50F499511C2C494A9CBA6B1035B17373"><enum>(A)</enum><text>the qualified development cost, reduced by so much of the amount described in subsection (c)(2)(B) as exceeds an amount equal to 75 percent of the costs described in subsection (c)(2)(A), or</text></subparagraph><subparagraph id="H99CE6DE2920F4AF7A05A475D7F066AEB"><enum>(B)</enum><text display-inline="yes-display-inline">80 percent of the national median sale price for new homes (as determined pursuant to the most recent census data available as of the date on which the neighborhood homes credit agency makes an allocation for the qualified project).</text></subparagraph></paragraph><paragraph commented="no" id="H07B4509D01934727800BC8E1BCD48078"><enum>(2)</enum><header>Allocations</header><subparagraph commented="no" id="HDF774A74C6FF4618B5BCE98369FAFEE3"><enum>(A)</enum><header>In general</header><text display-inline="yes-display-inline">The amount determined under subsection (a) with respect to a qualified residence that is part of a qualified project and with respect to which there is a qualified completion event shall not exceed the excess of—</text><clause commented="no" id="HC6CC86DB2B004C308CD9CCD175B55FF6"><enum>(i)</enum><text>the amount determined under subparagraph (B), over</text></clause><clause commented="no" id="HFEF6FF0920044AE2B9C6D03FE486FCB2"><enum>(ii)</enum><text>the amounts previously determined under subsection (a) with respect to such qualified project.</text></clause></subparagraph><subparagraph commented="no" id="H3BE17370F0D54E80BBFA64F269A73BF7"><enum>(B)</enum><header>Allocation amount</header><text display-inline="yes-display-inline">The amount determined under this paragraph with respect to a qualified residence that is part of a qualified project and with respect to which there is a qualified completion event is the least of—</text><clause commented="no" id="HD9CBE0BAE347476085B951D213041836"><enum>(i)</enum><text>the amount allocated to such project by the neighborhood homes credit agency under this section,</text></clause><clause commented="no" id="H11DC311FBF0F4169A65457E8D13077AD"><enum>(ii)</enum><text display-inline="yes-display-inline">pursuant to subparagraph (C), the amount such agency determines at the time of the qualified completion event is necessary to ensure the financial feasibility of the project, or</text></clause><clause id="H31784CB4464D455C89342C0303CCC0D7"><enum>(iii)</enum><text display-inline="yes-display-inline">in the case of a qualified completion event that occurs after the 5-year period beginning on the date of the allocation referred to in clause (i), $0.</text></clause></subparagraph><subparagraph id="id3054538E024441D5A89E948ECAAE6BFE"><enum>(C)</enum><header>Financial feasibility</header><text>For purposes of subparagraph (B)(ii), the neighborhood homes credit agency shall consider—</text><clause id="id6C932F031E3045ABB989C014D496E9E1"><enum>(i)</enum><text>the sources and uses of funds and the total financing planned for the qualified project,</text></clause><clause id="idE6CA15C5CCCB4A35837671EBA9E465E4"><enum>(ii)</enum><text>any proceeds or receipts expected to be generated by reason of tax benefits,</text></clause><clause id="idAAC779F8356045E695851DBF768B4D9D"><enum>(iii)</enum><text>the percentage of the amount allocated to such project under this section used for project costs other than the cost of intermediaries, and</text></clause><clause id="id4F9B08CD63BC4161AE6DC934832D9D10"><enum>(iv)</enum><text>the reasonableness of the qualified development cost of the qualified project.</text></clause></subparagraph></paragraph></subsection><subsection id="H08FF8208B73E4857BD2BE123B397CD0D"><enum>(c)</enum><header>Qualified development cost</header><text display-inline="yes-display-inline">For purposes of this section—</text><paragraph id="H37C8509A7C924BBF95DF69880DD7144D"><enum>(1)</enum><header>In general</header><text>The term <term>qualified development cost</term> means, with respect to a qualified residence, so much of the allowable development cost as the neighborhood homes credit agency certifies, at the time of the completion event, meets the standards promulgated under subsection (h)(1)(C).</text></paragraph><paragraph id="HC1A20DEF2B4F4B7DBF17317A94D8543F"><enum>(2)</enum><header>Allowable development cost</header><text display-inline="yes-display-inline">The term <term>allowable development cost</term> means—</text><subparagraph id="HC4CCBA14602144F095FFCBB470CAFD81"><enum>(A)</enum><text display-inline="yes-display-inline">any costs and fees relating to construction, substantial rehabilitation, demolition of any structure, or environmental remediation, and</text></subparagraph><subparagraph id="HBF0DC230CEE74C69952242B78597B769"><enum>(B)</enum><text>in the case of an affordable sale, the adjusted basis of buildings and land, determined as of the date of acquisition.</text></subparagraph></paragraph><paragraph id="HB183AA15B72346DAB40812A9856E90C6"><enum>(3)</enum><header>Condominium and cooperative housing units</header><text>In the case of a qualified residence described in subparagraph (B) or (C) of subsection (f)(1), the allowable development cost of such qualified residence shall be an amount equal to the total allowable development cost of the entire condominium or cooperative housing property in which such qualified residence is located, multiplied by a fraction—</text><subparagraph id="idFE7D8BEBF83740B78A7F5274C8AD66D3"><enum>(A)</enum><text>the numerator of which is the total floor space of such qualified residence, and</text></subparagraph><subparagraph id="id58166715F09C49F3B006F640218ED125"><enum>(B)</enum><text>the denominator of which is the total floor space of all residences within such property.</text></subparagraph></paragraph></subsection><subsection id="HFD64B869579E4D76B138E1A9E61E148B"><enum>(d)</enum><header>Qualified project</header><text display-inline="yes-display-inline">For purposes of this section, the term <term>qualified project</term> means a project that—</text><paragraph id="HA6387DBF7435463881DF9EAB99E8F035"><enum>(1)</enum><text>a neighborhood homes credit agency certifies will build or substantially rehabilitate one or more qualified residences located in one or more qualified census tracts, and</text></paragraph><paragraph commented="no" id="HE8A4762B7D3348AAABDB5D48459F8F66"><enum>(2)</enum><text display-inline="yes-display-inline">is designated by such agency as a qualified project under this section and is allocated (before such building or substantial rehabilitation begins) a portion of the amount allocated to such agency under subsection (g).</text></paragraph></subsection><subsection id="H1255DF38F6E3476E87E4C4EF176F8E1F"><enum>(e)</enum><header>Qualified census tract</header><text>For purposes of this section—</text><paragraph id="H73DCA09574CB428B963BC8D1682EAAEA"><enum>(1)</enum><header>In general</header><text>The term <term>qualified census tract</term> means a census tract—</text><subparagraph id="H35CF08C54B9D46D3AA9B10DAA052A68A"><enum>(A)</enum><text>with—</text><clause id="H363453CD95F74594A44920C7AB98E84E"><enum>(i)</enum><text>a median gross income which does not exceed 80 percent of the applicable area median gross income,</text></clause><clause id="H7579A384B2F94D1C95BD095EC6AC3855"><enum>(ii)</enum><text>a poverty rate that is not less than 130 percent of the applicable area poverty rate, and</text></clause><clause id="HF3B2CDA293CA4C8FA9BBBE7687B3DE16"><enum>(iii)</enum><text display-inline="yes-display-inline">a median value for owner-occupied homes that does not exceed applicable area median value for owner-occupied homes,</text></clause></subparagraph><subparagraph id="HB9D3F68B63914CF7BE44FC64C6D218A4"><enum>(B)</enum><text display-inline="yes-display-inline">which is located in a city with a population of not less than 50,000 and a poverty rate that is not less than 150 percent of the applicable area poverty rate, and which has—</text><clause id="idD3367431049C400A971ED11717E46F39"><enum>(i)</enum><text display-inline="yes-display-inline">a median gross income which does not exceed the applicable area median gross income, and</text></clause><clause id="idFFE293DE3A6A4F37B2273B40CC863053"><enum>(ii)</enum><text>a median value for owner-occupied homes that does not exceed 80 percent of the applicable area median value for owner-occupied homes, or</text></clause></subparagraph><subparagraph id="id94CF89C79CE14E3EBBE0546A52CB639D"><enum>(C)</enum><text display-inline="yes-display-inline">which is located in a nonmetropolitan county and which has—</text><clause id="HF792339740B54E1A926ABA4C1C109B98"><enum>(i)</enum><text>a median gross income which does not exceed the applicable area median gross income, and</text></clause><clause id="HAE6DB9700E5A44898D3810F8643F0ABB"><enum>(ii)</enum><text>been designated by a neighborhood homes credit agency under this clause.</text></clause></subparagraph></paragraph><paragraph id="H404FB2838C0148879DEA87E6C9C37FDF" commented="no"><enum>(2)</enum><header>Additional census tracts for substantial rehabilitation</header><text display-inline="yes-display-inline">In the case of a qualified residence that is intended for substantial rehabilitation described in subsection (f)(5)(B), the term <term>qualified census tract</term> includes a census tract which is located within an area—</text><subparagraph id="id6616EDF5FCB5436A9460F1A5F8722CB4" commented="no"><enum>(A)</enum><text display-inline="yes-display-inline">with respect to which a major disaster has been declared by the President, not more than 3 years before the date on which the neighborhood homes credit agency makes an allocation for a qualified project within such census tract, under section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, and</text></subparagraph><subparagraph id="id91712E8255DA46D2B2B7DFF68FD53B62" commented="no"><enum>(B)</enum><text display-inline="yes-display-inline">which contains qualified residences for which there are qualified development costs related to such major disaster.</text></subparagraph></paragraph><paragraph id="HD313969433834890BF2D750D8AEA2385"><enum>(3)</enum><header>List of qualified census tracts</header><text display-inline="yes-display-inline">The Secretary of Housing and Urban Development shall, for each year, make publicly available a list of qualified census tracts under—</text><subparagraph id="idD61E491EADCC4B589164DD70C3D84A9D"><enum>(A)</enum><text display-inline="yes-display-inline">on a combined basis, subparagraphs (A) and (B) of paragraph (1), </text></subparagraph><subparagraph id="id309FD496B13B4803ACE99EC7F99A3696"><enum>(B)</enum><text display-inline="yes-display-inline">subparagraph (C) of such paragraph, and </text></subparagraph><subparagraph id="idDF6BE8B6818D4737BB950832B26E8BDD"><enum>(C)</enum><text display-inline="yes-display-inline">paragraph (2).</text></subparagraph></paragraph></subsection><subsection id="H1248751EA24B4FDBA7A085FA33C641F4"><enum>(f)</enum><header>Other definitions</header><text>For purposes of this section—</text><paragraph id="H823D53D8A3BA4B13AC2DE7F04FA0695B"><enum>(1)</enum><header>Qualified residence</header><text>The term <term>qualified residence</term> means a residence that consists of—</text><subparagraph display-inline="no-display-inline" id="HE991FE27C7F742DAB7C1EC5E9DEA27ED"><enum>(A)</enum><text>a single-family home, including manufactured homes or similar housing units, containing 4 or fewer residential units,</text></subparagraph><subparagraph id="H91927D6B96144BF68DF008A27E9A6538"><enum>(B)</enum><text>a condominium unit, or</text></subparagraph><subparagraph id="H07918C795DE1498BB26034CB359B74F2"><enum>(C)</enum><text>a house or an apartment owned by a cooperative housing corporation (as defined in section 216(b)(1)).</text></subparagraph></paragraph><paragraph id="H61BD7AF48DC84C0FB4BCA5E31D06D9AC"><enum>(2)</enum><header>Affordable sale</header><subparagraph id="H422684619FC04868BD86560AF819D928"><enum>(A)</enum><header>In general</header><clause commented="no" id="H299E28AEB38B41FA9D178BB2A4278E81"><enum>(i)</enum><header>In general</header><text>The term <term>affordable sale</term> means a sale to a qualified homeowner of a qualified residence that the neighborhood homes credit agency certifies as meeting the standards promulgated under subsection (h)(1)(D) for a price that does not exceed—</text><subclause commented="no" id="H69BEABE273BA4D16937D42B141C0FE17"><enum>(I)</enum><text display-inline="yes-display-inline">in the case of any qualified residence not described in subclause (II), (III), or (IV), the amount equal to the product of 4 multiplied by the applicable area median gross income,</text></subclause><subclause commented="no" id="H243FBB25A3C44D0BB754FCE814606ACB"><enum>(II)</enum><text>in the case of a single-family home containing two residential units, 125 percent of the amount described in subclause (I),</text></subclause><subclause commented="no" id="H73DBD14234F54A39AE67FA6FBAE98ECA"><enum>(III)</enum><text display-inline="yes-display-inline">in the case of a single-family home containing three residential units, 150 percent of the amount described in subclause (I), or</text></subclause><subclause commented="no" id="HC3FE4FDFF7524116AA45A06416D0DB3F"><enum>(IV)</enum><text display-inline="yes-display-inline">in the case of a single-family home containing four residential units, 175 percent of the amount described in subclause (I).</text></subclause></clause><clause display-inline="no-display-inline" id="HD0210B4B9552489C9CD4F161E3B6AB05"><enum>(ii)</enum><header>Related persons</header><subclause id="HBD9BB5DE3BDB4965A5B84D02CA3599EA"><enum>(I)</enum><header>In general</header><text>A sale between related persons shall not be treated as an affordable sale.</text></subclause><subclause id="HF30CBBC791EA46B48B5984A782CA376F"><enum>(II)</enum><header>Definition</header><text>For purposes of this section, a person (in this clause referred to as the <quote>related person</quote>) is related to any person if the related person bears a relationship to such person specified in section 267(b) or 707(b)(1), or the related person and such person are engaged in trades or businesses under common control (within the meaning of subsections (a) and (b) of section 52). For purposes of the preceding sentence, in applying section 267(b) or 707(b)(1), <quote>10 percent</quote> shall be substituted for <quote>50 percent</quote>.</text></subclause></clause></subparagraph></paragraph><paragraph display-inline="no-display-inline" id="H147F551346014FEAB0052C48131F10D4"><enum>(3)</enum><header>Applicable area</header><text>The term <term>applicable area</term> means—</text><subparagraph id="H33F02B24E3604F9E9AFC21C3D7718D53"><enum>(A)</enum><text>in the case of a metropolitan census tract, the metropolitan area in which such census tract is located, and</text></subparagraph><subparagraph id="H4DB134C9959C46BB9C540B75D6C614D1"><enum>(B)</enum><text display-inline="yes-display-inline">in the case of a census tract other than a census tract described in subparagraph (A), the State.</text></subparagraph></paragraph><paragraph id="HF4DEAE4672424809AB782CC076A20675"><enum>(4)</enum><header>Substantial rehabilitation</header><text>The term <term>substantial rehabilitation</term> means rehabilitation efforts involving qualified development costs that are not less than the greater of—</text><subparagraph id="H2515D5A628F8492F84BF2AF02CFC361C"><enum>(A)</enum><text>$20,000, or</text></subparagraph><subparagraph commented="no" id="H11E42320F72149C9BBE7DF5DC084D28A"><enum>(B)</enum><text display-inline="yes-display-inline">20 percent of the adjusted basis of the buildings and land, determined as of the date of acquisition.</text></subparagraph></paragraph><paragraph id="H9AFD64ACAAF14EA3BD60F793B8A69215"><enum>(5)</enum><header>Qualified completion event</header><text display-inline="yes-display-inline">The term <term>qualified completion event</term> means—</text><subparagraph id="HF5C4201482464CD282293AACCE11642A"><enum>(A)</enum><text display-inline="yes-display-inline">in the case of a qualified residence that is built or substantially rehabilitated as part of a qualified project and sold, an affordable sale, or</text></subparagraph><subparagraph id="H4509E3947B124A3C97EA5D1A19F220F2"><enum>(B)</enum><text display-inline="yes-display-inline">in the case of a qualified residence that is substantially rehabilitated as part of a qualified project and owned by the same qualified homeowner throughout such rehabilitation, the completion of such rehabilitation (as determined by the neighborhood homes credit agency) to the standards promulgated under subsection (h)(1)(D).</text></subparagraph></paragraph><paragraph id="HEEED3F4B3413412A99558C870A519491"><enum>(6)</enum><header>Qualified homeowner</header><subparagraph id="H06F875C680984CFE81E3708FEFF2493B"><enum>(A)</enum><header>In general</header><text>The term <term>qualified homeowner</term> means, with respect to a qualified residence, an individual—</text><clause id="H1623C49EA8F44DDC908BEAFB6F1D2969"><enum>(i)</enum><text>who owns and uses such qualified residence as the principal residence of such individual, and</text></clause><clause id="H3866182CECF04E57B72E4AC34664FDD2"><enum>(ii)</enum><text display-inline="yes-display-inline">whose income is 140 percent or less of the applicable area median gross income for the location of the qualified residence.</text></clause></subparagraph><subparagraph commented="no" id="H73CB35E31EED4019897D912B30EE5A72"><enum>(B)</enum><header>Ownership</header><text display-inline="yes-display-inline">For purposes of a cooperative housing corporation (as such term is defined in section 216(b)), a tenant-stockholder shall be treated as owning the house or apartment which such person is entitled to occupy.</text></subparagraph><subparagraph id="HA2008E06D7694163839B27A5E7EFFFC5"><enum>(C)</enum><header>Income</header><text display-inline="yes-display-inline">For purposes of this paragraph, income shall be a determined in accordance with section 143(f)(2) and 143(f)(4).</text></subparagraph><subparagraph id="H1465EE3CB6254C47841D6C7854AAE2AD"><enum>(D)</enum><header>Timing</header><text display-inline="yes-display-inline">For purposes of this paragraph, the income of a taxpayer shall be determined—</text><clause id="HDF16C3A3F5E2402B81943142AD9904E6"><enum>(i)</enum><text display-inline="yes-display-inline">in the case of a qualified residence that is built or substantially rehabilitated as part of a qualified project and sold, at the time a binding contract for purchase is made, or</text></clause><clause id="HB120A44921164B56B2B318B19C75148E"><enum>(ii)</enum><text display-inline="yes-display-inline">in the case of a qualified residence that is occupied by a qualified homeowner and intended to be substantially rehabilitated as part of a qualified project, at the time a binding contract to undertake such rehabilitation is made.</text></clause></subparagraph></paragraph><paragraph commented="no" display-inline="no-display-inline" id="H24F50883E5054F0291DEE5F3EBA0B410"><enum>(7)</enum><header>Neighborhood homes credit agency</header><text display-inline="yes-display-inline">The term <term>neighborhood homes credit agency</term> means the agency designated by the State as the neighborhood homes credit agency of the State.</text></paragraph></subsection><subsection id="H1620D3D528C2423BBD5C244A1F436A15"><enum>(g)</enum><header>Allocation</header><paragraph id="H0145B6848BAF4C7484289D7F61F384AB"><enum>(1)</enum><header>State neighborhood homes credit ceiling</header><text display-inline="yes-display-inline">The State neighborhood homes credit amount for a State for a calendar year is an amount equal to the greater of—</text><subparagraph id="HC46B2C54B9624555A2EF2ACB575DB9EB"><enum>(A)</enum><text display-inline="yes-display-inline">the product of $6, multiplied by the State population (determined in accordance with section 146(j)), or</text></subparagraph><subparagraph id="H511127CAC47E47BAAE3EA9C352098C31"><enum>(B)</enum><text display-inline="yes-display-inline">$8,000,000.</text></subparagraph></paragraph><paragraph id="HD5AB34653E6A45988F0B94F81A2DAD8C"><enum>(2)</enum><header>Unused amount</header><text display-inline="yes-display-inline">The State neighborhood homes credit amount for a calendar year shall be increased by the sum of—</text><subparagraph id="HBA646DDB11F647FBA3D3FF5A1B0893A7"><enum>(A)</enum><text display-inline="yes-display-inline">any amount certified by the neighborhood homes credit agency of the State as having been previously allocated to a qualified project and not used during the 5-year period described in subsection (b)(2)(B)(iii), plus</text></subparagraph><subparagraph id="H3A87B172D63E4B20AF150FA669D7ADA8"><enum>(B)</enum><text>sum of the amount by which the amount determined under paragraph (1) (without application of this paragraph) exceeded the amount allocated to qualified projects in each of the three immediately preceding calendar years.</text></subparagraph></paragraph><paragraph commented="no" id="HD8C58FA5079F4FEEA92FC0C6858F7A47"><enum>(3)</enum><header>Portion of state credit ceiling for certain projects involving qualified nonprofit organizations</header><text display-inline="yes-display-inline">Rules similar to the rules of section 42(h)(5) shall apply.</text></paragraph></subsection><subsection commented="no" id="H447CE2D9FED34102A43C74A3F537C56A"><enum>(h)</enum><header>Responsibilities of neighborhood homes credit agencies</header><paragraph commented="no" id="HF6A003A92ADF410C9915E186237D3B69"><enum>(1)</enum><header>In general</header><text>Notwithstanding subsection (g), the State neighborhood homes credit dollar amount shall be zero for a calendar year unless the neighborhood homes credit agency of the State—</text><subparagraph commented="no" id="HE65FDC49F0BC4482A378577412C0C388"><enum>(A)</enum><text display-inline="yes-display-inline">allocates such amount pursuant to a qualified allocation plan of the neighborhood homes credit agency,</text></subparagraph><subparagraph commented="no" id="H9063C49D632D4E4F901ABCDA153B4F4D"><enum>(B)</enum><text>allocates not more than 20 percent of such amount for the previous year to projects with respect to qualified residences in census tracts under subsection (e)(1)(C) or (e)(2),</text></subparagraph><subparagraph commented="no" id="H6C7BF489E38744C8A9D447AD12C84854"><enum>(C)</enum><text>promulgates standards with respect to reasonable qualified development costs and fees,</text></subparagraph><subparagraph id="HE377FF47D9A14AD1B2A21AFF38354A41"><enum>(D)</enum><text>promulgates standards with respect to construction quality, and</text></subparagraph><subparagraph commented="no" id="H9094900CAA464B6DBA79E11C536A60A1"><enum>(E)</enum><text>submits to the Secretary (at such time and in such manner as the Secretary may prescribe) an annual report specifying—</text><clause commented="no" id="HDA38D734A1EC4F0D8746DA0B722D191F"><enum>(i)</enum><text>the amount of the neighborhood homes credits allocated to each qualified project for the previous year,</text></clause><clause commented="no" id="H595E8C19D469478190CBEAC2C365248B"><enum>(ii)</enum><text>with respect to each qualified residence completed in the preceding calendar year—</text><subclause commented="no" id="idA1A5975AFB504DA6BE923DFC25E705E8"><enum>(I)</enum><text>the census tract in which such qualified residence is located,</text></subclause><subclause commented="no" id="id48C897D196BC48E9A4E21D1ABFD8FF32"><enum>(II)</enum><text>with respect to the qualified project that includes such qualified residence, the year in which such project received an allocation under this section,</text></subclause><subclause commented="no" id="idD2C9617F802148C59A98099B8466F8C0"><enum>(III)</enum><text>whether such qualified residence was new or substantially rehabilitated,</text></subclause><subclause commented="no" id="id8EFD7049ABDD471C871B760654DAB63D"><enum>(IV)</enum><text>the eligible basis of such qualified residence,</text></subclause><subclause commented="no" id="id3A7F33EE2B1146318647B3BFA2541FB6"><enum>(V)</enum><text>the amount of the neighborhood homes credit with respect to such qualified residence,</text></subclause><subclause commented="no" id="idAE7659CA8D8A40AFACB0ECD6EC856C40"><enum>(VI)</enum><text>the sales price of such qualified residence or, in the case of a qualified residence that is substantially rehabilitated as part of a qualified project and is owned by the same qualified homeowner during the entirety of such rehabilitation, the cost of the substantial rehabilitation, and</text></subclause><subclause commented="no" id="id04BF76D816354896BF8D6A5B1520B0E8"><enum>(VII)</enum><text>the income of the qualified homeowner (expressed as a percentage of the applicable area median gross income for the location of the qualified residence), and</text></subclause></clause><clause commented="no" id="id13F82F77A93D4EA2BB482DAC7BBDD1E8"><enum>(iii)</enum><text>such other information as the Secretary may require.</text></clause></subparagraph></paragraph><paragraph commented="no" id="H2CB0A49537434ACDA3F6371919F40BA0"><enum>(2)</enum><header>Qualified allocation plan</header><text>For purposes of this subsection, the term <term>qualified allocation plan</term> means any plan which—</text><subparagraph commented="no" id="HC1A9C5765A4A473EA641D7AA421C4C90"><enum>(A)</enum><text display-inline="yes-display-inline">sets forth the selection criteria to be used to prioritize qualified projects for allocations of State neighborhood homes credit dollar amounts, including—</text><clause commented="no" id="H62A1B9D6AA39435F9E9B9CE679F9FF55"><enum>(i)</enum><text>the need for new or substantially rehabilitated owner-occupied homes in the area addressed by the project,</text></clause><clause commented="no" id="HF8BBD78E8227460F909E1942DB874D39"><enum>(ii)</enum><text>the expected contribution of the project to neighborhood stability and revitalization,</text></clause><clause commented="no" id="H7A6E746E2FD04A88B8DE84B7C632217B"><enum>(iii)</enum><text>the capability of the project sponsor, and</text></clause><clause commented="no" id="H2A608535FE114361946F42830743EAB8"><enum>(iv)</enum><text>the likelihood the project will result in long-term homeownership,</text></clause></subparagraph><subparagraph commented="no" id="H6D9E44D55EF64332AD2A0A7296E62170"><enum>(B)</enum><text>has been made available for public comment, and</text></subparagraph><subparagraph commented="no" id="id4CB9C13EC7094E7E8FA1657C8E1B9502"><enum>(C)</enum><text>provides a procedure that the neighborhood homes credit agency (or any agent or contractor of such agency) shall follow for purposes of—</text><clause commented="no" id="id1AD6C44982494DED8BDC9FF486545DDB"><enum>(i)</enum><text>identifying noncompliance with any provisions of this section, and</text></clause><clause commented="no" id="idDEBCDE050BF04378A2F8A9546A95B46D"><enum>(ii)</enum><text>notifying the Secretary of any such noncompliance of which the agency becomes aware.</text></clause></subparagraph></paragraph></subsection><subsection id="H215AD46812134D398DD26658C81DDFE8"><enum>(i)</enum><header>Possessions treated as States</header><text>For purposes of this section, the term <term>State</term> includes the District of Columbia and a possession of the United States.</text></subsection><subsection id="H57A6433CC2FE4429BAEBF1F7585B500C"><enum>(j)</enum><header>Repayment</header><paragraph commented="no" id="HC1908C0A601A47C4B40C72967471AEC7"><enum>(1)</enum><header>In general</header><subparagraph commented="no" id="idF116437B99234C06A6C3F043CA44779D"><enum>(A)</enum><header>Sold during 5-year period</header><text display-inline="yes-display-inline">If a qualified residence is sold during the 5-year period beginning on the date of the qualified completion event described in subsection (a) with respect to such qualified residence, the seller shall transfer an amount equal to the repayment amount from the amount realized on such sale to the relevant neighborhood homes credit agency.</text></subparagraph><subparagraph commented="no" id="idF22DDD378E6C49438EFA610EC3A98F3F"><enum>(B)</enum><header>Use of repayments</header><text>A neighborhood homes credit agency shall use any amount received pursuant to subparagraph (A) only for purposes of qualified projects. </text></subparagraph></paragraph><paragraph id="H1483AD8BCA9947EF976D08893605BEA0"><enum>(2)</enum><header>Repayment amount</header><text>For purposes of paragraph (1)(A), the repayment amount is an amount equal to 50 percent of the gain from such resale, reduced by 20 percent for each year of the 5-year period referred to in paragraph (1)(A) which ends before the date of the sale referred to in such paragraph.</text></paragraph><paragraph id="H98E52B4CA89A40F38808D716689E52D9"><enum>(3)</enum><header>Lien for repayment amount</header><text>A neighborhood homes credit agency receiving an allocation under this section shall place a lien on each qualified residence that is built or rehabilitated as part of a qualified project for an amount such agency deems necessary to ensure potential repayment pursuant to paragraph (1)(A).</text></paragraph><paragraph id="H8D20018FBB214F75A156F67FEED639E1"><enum>(4)</enum><header>Denial of deductions if converted to rental housing</header><text display-inline="yes-display-inline">If, during the 5-year period beginning on the date of the qualified completion event described in subsection (a), an individual who owns a qualified residence fails to use such qualified residence as such individual’s principal residence for any period of time, no deduction shall be allowed for expenses paid or incurred by such individual with respect to renting, during such period of time, such qualified residence.</text></paragraph><paragraph commented="no" id="H0642F1112946403797989A915CD46DF7"><enum>(5)</enum><header>Waiver</header><text display-inline="yes-display-inline">The neighborhood homes credit agency may waive the repayment required under paragraph (1)(A) in the case of a homeowner experiencing a hardship.</text></paragraph></subsection><subsection id="H5F597AB5ADAA435894CCDA6D7971307E"><enum>(k)</enum><header>Report</header><paragraph id="idF315C2F94B984B1882ABBE660C2B10BB"><enum>(1)</enum><header>In general</header><text>The Secretary shall annually issue a report, to be made available to the public, which contains the information submitted pursuant to subsection (h)(1)(E).</text></paragraph><paragraph id="id884592FD4CAD4A05BFC2F196550527B0"><enum>(2)</enum><header>De-identification</header><text>The Secretary shall ensure that any information made public pursuant to paragraph (1) excludes any information that would allow for the identification of qualified homeowners.</text></paragraph></subsection><subsection id="idCD39C6C6A52840D39DCEB8DAC887FEA1"><enum>(l)</enum><header>Inflation adjustment</header><paragraph id="H68090BA0744C438C991C7BB517FC134D"><enum>(1)</enum><header>In general</header><text>In the case of a calendar year after 2022, the dollar amounts in this section shall each be increased by an amount equal to—</text><subparagraph display-inline="no-display-inline" id="HC048A0736B0943AFB1341D97119FB8E8"><enum>(A)</enum><text>such dollar amount, multiplied by</text></subparagraph><subparagraph id="HCC6F62DC606E4CB8AF6295D90211704C"><enum>(B)</enum><text>the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting <quote>calendar year 2021</quote> for <quote>calendar year 2016</quote> in subparagraph (A)(ii) thereof.</text></subparagraph></paragraph><paragraph id="H94FB43614B134F809129E69B5C74FF6D"><enum>(2)</enum><header>Rounding</header><subparagraph id="HDF7993EC697040B99B84A01DE8775683"><enum>(A)</enum><header>Substantial rehabilitation</header><text>In the case of the dollar amount in subsection (f)(4), any increase under the preceding sentence which is not a multiple of $1,000 shall be rounded to the nearest multiple of $1,000.</text></subparagraph><subparagraph id="HC69656B2E9EA48B79D302D3CD5236BFE"><enum>(B)</enum><text>In the case of the dollar amount in subsection (g)(1)(A), any increase under the preceding sentence which is not a multiple of $0.01 shall be rounded to the nearest multiple of $0.01.</text></subparagraph><subparagraph id="HBC2D540B48F54E71834BBB9541ED93FE"><enum>(C)</enum><text>In the case of the dollar amount in subsection (g)(1)(B), any increase under the preceding sentence which is not a multiple of $100,000 shall be rounded to the nearest multiple of $100,000.</text></subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="H2FD7765667B64011A6BA15BB7B49BFA7" commented="no"><enum>(b)</enum><header>Current year business credit calculation</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/38">Section 38(b)</external-xref> of the Internal Revenue Code of 1986, as amended by section 216, is further amended by redesignating paragraphs (6) through (34) as paragraphs (7) through (35), respectively, and by inserting after paragraph (5) the following new paragraph:</text><quoted-block style="OLC" id="HB6353B1BE391452A81CE54DB8AB0639D"><paragraph id="H14C516A1B41F43F691C14D5973AD1DAC" commented="no"><enum>(6)</enum><text>the neighborhood homes credit determined under section 42B(a),</text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection commented="no" id="HA9E9F2B1DC274797AE1F64453918BF5B"><enum>(c)</enum><header>Limitation on carryback</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/39">Section 39</external-xref> of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:</text><quoted-block style="OLC" id="H435D02C90E1848ADBCF7D519D39F8550"><subsection commented="no" id="H8C6FB6F5A486402F95D258ED6D8BDDEE"><enum>(e)</enum><header>No carryback of neighborhood homes credit before effective date</header><text display-inline="yes-display-inline">No amount of the unused credit attributable to section 42B may be taken into account under section 38(a)(3) for any taxable year beginning before the date of the enactment of this subsection.</text></subsection><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="HDDBB7249D6A04866931B9E1B09EBA775" commented="no"><enum>(d)</enum><header>Conforming amendments</header><text display-inline="yes-display-inline">Subsections (i)(3)(C), (i)(6)(B)(i), and (k)(1) of <external-xref legal-doc="usc" parsable-cite="usc/26/469">section 469</external-xref> of the Internal Revenue Code of 1986, as amended by section 216, are each further amended by striking <quote>42 or 42A</quote> and inserting <quote>42, 42A, or 42B</quote>.</text></subsection><subsection id="H12AE08E34B244FC19AAD2D5D82898AE9"><enum>(e)</enum><header>Clerical amendment</header><text>The table of sections for subpart D of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986, as amended by section 216, is further amended by inserting after the item relating to section 42A the following:</text><quoted-block style="OLC" id="H152AC6AAD3274805AAAEF4703F0CD3CD"><toc regeneration="no-regeneration"><toc-entry bold="off" level="section">Sec. 42B. Neighborhood homes credit.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="H80290A2F7F184D95AF0E9257C955E14C"><enum>(f)</enum><header>Effective date</header><text>The amendments made by this section shall apply to calendar years beginning after December 31, 2021.</text></subsection></section><section id="id867E7A9CD99E45FD970B39618509C20A" section-type="subsequent-section"><enum>218.</enum><header>First-time homebuyer refundable credit</header><subsection id="id54E5A0D083AC4464A544DC2D2A6884EE"><enum>(a)</enum><header>In general</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/36">Section 36</external-xref> of the Internal Revenue Code of 1986 is amended to read as follows:</text><quoted-block style="OLC" act-name="" id="id971DE541BE124493B810109BF9FFB04F"><section id="idEC4FC84ABB254672B8DBD384F33D48D6"><enum>36.</enum><header>First-time homebuyer refundable credit</header><subsection id="id633117A2F87C4E01AF073B79EFA1EF57"><enum>(a)</enum><header>Allowance of credit</header><text>In the case of an individual who is a first-time homebuyer of a principal residence in the United States during a taxable year, there shall be allowed as a credit against the tax imposed by this subtitle for such taxable year an amount equal to 20 percent of the purchase price of the residence.</text></subsection><subsection id="idB304343E7D574CD6AA0ED8A9660B26E1"><enum>(b)</enum><header>Limitations; special rules based on marital and filing status</header><paragraph id="idE88AB231A6A2413A8404283A837D5579"><enum>(1)</enum><header>Dollar limitation</header><text>The credit allowed under subsection (a) shall not exceed $15,000.</text></paragraph><paragraph id="id4C9D7C16A63C4F789871ADC4C7698374"><enum>(2)</enum><header>Limitation based on purchase price</header><text>The amount allowable as a credit under subsection (a) (determined without regard to this paragraph and paragraph (3), and after the application of paragraph (1)) for the taxable year shall be reduced (but not below zero) by the amount which bears the same ratio to the amount which is so allowable as—</text><subparagraph id="id155A46FE5FAE466B99C720EA612D0045"><enum>(A)</enum><text>the excess (if any) of—</text><clause id="id2CA58748E2B4450FA08287D7964A3900"><enum>(i)</enum><text>the purchase price of the residence, over</text></clause><clause id="id47EF48281B0F4605BC77608679F13FFB"><enum>(ii)</enum><text>an amount equal to 110 percent of the conforming loan limit applicable to the residence, bears to</text></clause></subparagraph><subparagraph id="id1014DA3358B84A84BF5C8061241B81D2"><enum>(B)</enum><text>$100,000.</text></subparagraph><continuation-text continuation-text-level="paragraph">For purposes of the preceding sentence, the term <term>conforming loan limit</term> with respect to any residence means the applicable limitation governing the maximum original principal obligation for a mortgage secured by a residence of the same type, as determined and adjusted annually under section 302(b)(2) of the Federal National Mortgage Association Charter Act and section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act.</continuation-text></paragraph><paragraph id="idDFBE671559704433828EB8B62CB605C1"><enum>(3)</enum><header>Limitation based on modified adjusted gross income</header><subparagraph id="idDBF38F8C89F346BC8E89445851812323"><enum>(A)</enum><header>In general</header><text>The amount allowable as a credit under subsection (a) (determined without regard to this paragraph and after the application of paragraphs (1) and (2)) for the taxable year shall be reduced (but not below zero) by the amount which bears the same ratio to the amount which is so allowable as—</text><clause id="id4C98EAFAF790424D9FE389A10952A2B8"><enum>(i)</enum><text>the excess (if any) of—</text><subclause id="idFA3004506D8A4F1A8CBADB0CDCFCBA85"><enum>(I)</enum><text>the taxpayer's modified adjusted gross income for the preceding taxable year, over</text></subclause><subclause id="id3975B8FC49164ABAA51BA5BBE5B633D5"><enum>(II)</enum><text>the applicable threshold, bears to</text></subclause></clause><clause id="idF8E02558FFBF41CEB94349834574F297"><enum>(ii)</enum><text>$50,000.</text></clause></subparagraph><subparagraph id="idD21BC98644BD4E8EB0BE848BB4F6E569"><enum>(B)</enum><header>Modified adjusted gross income</header><text>For purposes of subparagraph (A), the term <term>modified adjusted gross income</term> with respect to any taxable year means the adjusted gross income of the taxpayer for such taxable year increased by any amount excluded from gross income under section 911, 931, or 933 for such taxable year.</text></subparagraph><subparagraph id="id231BCA6A83C041B6B8BE8FD99A70A15F"><enum>(C)</enum><header>Applicable threshold</header><text>For purposes of subparagraph (A), the applicable threshold is—</text><clause id="id40D1BFC7167F4B4D95EF44C4C3C960AE"><enum>(i)</enum><text>except as provided in clauses (ii) and (iii), $100,000,</text></clause><clause id="id139FA91866CF4A50816CB612572DE5A5"><enum>(ii)</enum><text>an amount equal to 150 percent of the amount in effect under clause (i), in the case of a head of household (as defined in section 2(b)), and</text></clause><clause id="id1B0084F1A5DE4E9E92E9D140FBDE2634"><enum>(iii)</enum><text>an amount equal to 200 percent of the amount in effect under clause (i), in the case of a joint return.</text></clause></subparagraph></paragraph><paragraph id="idD3E61BE1A21342C09BEA82AF2F04C717"><enum>(4)</enum><header>Additional limitations</header><text>No credit shall be allowed under subsection (a) with respect to the purchase of any residence for a taxable year—</text><subparagraph id="idF39FC09DBC5B4AE89D854BC0C557A354"><enum>(A)</enum><text>if the taxpayer is a nonresident alien, or</text></subparagraph><subparagraph id="idAC630BFD3E914FAA9CCACFFD474B0172"><enum>(B)</enum><text>if—</text><clause id="id2CC1DB3D323D4EADB08ED5EF7D0C0B9B"><enum>(i)</enum><text>the taxpayer has not attained age 18 as of the date of such purchase, or</text></clause><clause id="id1939CF9E53BE41C08E9AC79F6F065214"><enum>(ii)</enum><text>a deduction under section 151 with respect to the taxpayer is allowable to another taxpayer for the taxable year.</text></clause></subparagraph><continuation-text continuation-text-level="paragraph">In the case of a taxpayer who is married, the taxpayer shall be treated as meeting the age requirement of subparagraph (B)(i) if the taxpayer or the taxpayer's spouse meets such age requirement.</continuation-text></paragraph><paragraph id="idDDD2CF928D404E55BB4AF076234339D3"><enum>(5)</enum><header>Multiple purchasers</header><text>If 2 or more individuals who are not married purchase a principal residence, the amount of the credit under subsection (a) shall be allocated among such individuals in such manner as the Secretary may prescribe by taking into account the requirements of paragraphs (2) and (3), except that the total amount of the credits allowed to all such individuals shall not exceed the limitation under paragraph (1) (as modified by paragraph (7)).</text></paragraph><paragraph id="id65cc11e609cc45419630d31bbe7ee746"><enum>(6)</enum><header>Married couples must file joint return</header><text>If an individual is married at the close of the taxable year, the credit shall be allowed under subsection (a) only if the individual and the individual's spouse file a joint return for the taxable year.</text></paragraph><paragraph id="id2783CF0917DE47F0AB9FFA5FA664C5EC"><enum>(7)</enum><header>Adjustment for inflation</header><text>In the case of any taxable year beginning after December 31, 2022, each of the dollar amounts in paragraphs (1), (2)(A)(ii), and (3)(C)(i) shall be increased by an amount equal to—</text><subparagraph id="id3609A0990C8341EAAECC7764BD6ECBDC"><enum>(A)</enum><text>such dollar amount, multiplied by</text></subparagraph><subparagraph id="ided74adc6de6d4c11931d50d8c2231e54"><enum>(B)</enum><text>the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting <quote>calendar year 2021</quote> for <quote>calendar year 2016</quote> in subparagraph (A)(ii) thereof.</text></subparagraph><continuation-text continuation-text-level="paragraph">Any increase determined under the preceding sentence shall be rounded to the next lowest multiple of $50.</continuation-text></paragraph></subsection><subsection id="idDE38640AC61E4E4CAAE8DDAC5FAC0503"><enum>(c)</enum><header>Definitions</header><text>For purposes of this section—</text><paragraph id="idB5C1685677CC4A1D8137AC3CF8D1C048"><enum>(1)</enum><header>First-time homebuyer</header><subparagraph id="idCACDE6E3D0E94BEAAC55313B175DA699"><enum>(A)</enum><header>In general</header><text>The term <term>first-time homebuyer</term> means any individual who acquires a principal residence located in the United States by purchase if such individual (and, if married, such individual's spouse)—</text><clause id="id02DAEEBB76BA4B49B1677A7A707E09CE"><enum>(i)</enum><text>has not claimed any credit or deduction under this title for any previous taxable year with respect to the purchase or ownership of any residence or residential real estate (including for any expenditures relating to the placing in service of any property on, in connection with, or for use in such a residence or real estate), and</text></clause><clause id="id1460CF42AD6F4B84ADE5C005798064E6"><enum>(ii)</enum><text>attests under penalty of perjury that—</text><subclause id="idF7CFE38C106747129150E5074F3C8045"><enum>(I)</enum><text>the individual (and, if married, the individual's spouse) has not owned a principal residence at any time prior to the purchase of the principal residence to which this section applies, and</text></subclause><subclause id="idAE09FB6291974CE2921139A99F827C14"><enum>(II)</enum><text>the principal residence to which this section applies was not acquired from a person related to such individual or spouse.</text></subclause></clause></subparagraph><subparagraph id="id1DA607B514A54F37B22C0D89E4AF03AE"><enum>(B)</enum><header>Waiver in case of certain changes in status</header><text>The Secretary may, in such manner as the Secretary may prescribe, waive the requirements of subparagraph (A) for a taxable year in the case of an individual who is not eligible to file a joint return for the taxable year, and who was married at the time the individual or the individual's former spouse purchased a previous residence.</text></subparagraph></paragraph><paragraph id="idA777A6941DAB47BE96BD54DB3B93B5BF"><enum>(2)</enum><header>Principal residence</header><text>The term <term>principal residence</term> has the same meaning as when used in section 121.</text></paragraph><paragraph id="idFC2A3145A61446D28BFEB18E18D3F6D6"><enum>(3)</enum><header>Purchase</header><subparagraph id="idB38D6C55946541BDB15A4A1DDC14ACF1"><enum>(A)</enum><header>In general</header><text>The term <term>purchase</term> means any acquisition, but only if—</text><clause id="id29C9A208064742A2B97A6F893306FB78"><enum>(i)</enum><text>the property is not acquired from a person related to the person acquiring such property (or, if either such person is married, such individual's spouse), and</text></clause><clause id="id820BEB1049134DDC92886A23C5688493"><enum>(ii)</enum><text>the basis of the property in the hands of the person acquiring such property is not determined—</text><subclause id="id7442122D5BD74022B0512E8E2BCA60B4"><enum>(I)</enum><text>in whole or in part by reference to the adjusted basis of such property in the hands of the person from whom acquired, or</text></subclause><subclause id="id125B65968DF9469CA2661EF75B707B20"><enum>(II)</enum><text>under section 1014(a).</text></subclause></clause></subparagraph><subparagraph id="idCBDB6147BA2944378EF87937F077A34E"><enum>(B)</enum><header>Construction</header><text>A residence which is constructed by the taxpayer shall be treated as purchased by the taxpayer on the date the taxpayer first occupies such residence.</text></subparagraph></paragraph><paragraph id="idA796266A9D404B8B9CE53AC087527328"><enum>(4)</enum><header>Purchase price</header><text>The term <term>purchase price</term> means the adjusted basis (without regard to any reduction under section 1016(a)(38)) of the principal residence on the date such residence is purchased.</text></paragraph><paragraph id="id3C36391FA61545648C6C6EAB01B5B189"><enum>(5)</enum><header>Related persons</header><text>A person shall be treated as related to another person if the relationship between such persons would result in the disallowance of losses under section 267 or 707(b) (but, in applying subsections (b) and (c) of section 267 for purposes of this section, paragraph (4) of section 267(c) shall be treated as providing that the family of an individual shall include only the individual's spouse, ancestors, lineal descendants, and spouse's ancestors and lineal descendants).</text></paragraph><paragraph id="id9E01B244DDB54B08BBBE3D0471FBCB82"><enum>(6)</enum><header>Marital status</header><text>An individual's marital status shall be determined in accordance with section 7703.</text></paragraph></subsection><subsection id="idA551BA91C9A04EC88AEC14F9E140CDB1"><enum>(d)</enum><header>Denial and recapture rules in case of disposal of residence within 6 taxable years</header><paragraph id="idF6B4DFADBF5647CB8155374BA0FB49A2"><enum>(1)</enum><header>Denial of credit in case of disposal within taxable year</header><text>No credit under subsection (a) shall be allowed to any taxpayer for any taxable year with respect to the purchase of a residence if the taxpayer disposes of such residence (or such residence ceases to be the principal residence of the taxpayer (and, if married, the taxpayer's spouse)) before the close of such taxable year.</text></paragraph><paragraph id="id9AA1134C1BD44BA09EE2A4FCE82FC437"><enum>(2)</enum><header>Phased-out recapture</header><subparagraph id="id2ED5118FF1584AA4A373922C171D6163"><enum>(A)</enum><header>In general</header><text>Except as provided in subparagraph (D), if the taxpayer disposes of the residence with respect to which a credit was allowed under subsection (a) (or such residence ceases to be the principal residence of the taxpayer (and, if married, the taxpayer's spouse)) during the 5-taxable-year period beginning with the taxable year immediately following the credit year, the tax imposed by this chapter for the taxable year in which such disposal (or cessation) occurs shall be increased by an amount equal to the recapture percentage of the amount of the credit so allowed.</text></subparagraph><subparagraph id="idC514773219F04E36BFEA5DAA9DF963A3"><enum>(B)</enum><header>Credit year</header><text>For purposes of subparagraph (A), the term <term>credit year</term> means the taxable year in which the credit under subsection (a) was allowed.</text></subparagraph><subparagraph id="idFF1E485081FE4FE0BC854BA883C1BA48"><enum>(C)</enum><header>Recapture percentage</header><text>For purposes of subparagraph (A), the recapture percentage with respect to any disposal or cessation described in such subparagraph shall be determined in accordance with the following table:</text><table table-type="Leaderwork" table-template-name="Flush/hang, 1 text, 1 num, bold hds" align-to-level="section" frame="none" colsep="0" rowsep="0" blank-lines-before="1" line-rules="no-gen" rule-weights="0.0.0.0.0.0" subformat="S6211"><tgroup cols="2" rowsep="0"><colspec coldef="txt" colname="column1" min-data-value="55" colwidth="269pts"></colspec><colspec coldef="fig" colname="column2" min-data-value="10" colwidth="204.19pt"></colspec><thead><row><entry align="left" morerows="0" namest="column1" rowsep="0" colname="column1"><bold>If the disposal or </bold></entry><entry align="right" morerows="0" namest="column2" rowsep="0" colname="column2"><bold>The recapture</bold></entry></row><row><entry align="left" morerows="0" namest="column1" rowsep="0" colname="column1"><bold> cessation occurs in:</bold></entry><entry align="right" morerows="0" namest="column2" rowsep="0" colname="column2"><bold>percentage is:</bold></entry></row></thead><tbody><row><entry align="left" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr" colname="column1">The 1st taxable year beginning after the credit year</entry><entry align="right" leader-modify="clr-ldr" rowsep="0" colname="column2">100 percent</entry></row><row><entry align="left" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr" colname="column1">The 2nd taxable year beginning after the credit year</entry><entry align="right" leader-modify="clr-ldr" rowsep="0" colname="column2">80 percent</entry></row><row><entry align="left" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr" colname="column1">The 3rd taxable year beginning after the credit year</entry><entry align="right" leader-modify="clr-ldr" rowsep="0" colname="column2">60 percent</entry></row><row><entry align="left" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr" colname="column1">The 4th taxable year beginning after the credit year</entry><entry align="right" leader-modify="clr-ldr" rowsep="0" colname="column2">40 percent</entry></row><row><entry align="left" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr" colname="column1">The 5th taxable year beginning after the credit year</entry><entry align="right" leader-modify="clr-ldr" rowsep="0" colname="column2">20 percent.</entry></row></tbody></tgroup></table></subparagraph><subparagraph id="id1C08E8CB65B04B5586FEF6CEF1B08343"><enum>(D)</enum><header>Exceptions</header><text>This paragraph shall not apply in the case of a disposal or cessation described in subparagraph (A) which occurs after or incident to any of the following:</text><clause id="idB473F1DEB77E44F0A3FD070DE3DDFC58"><enum>(i)</enum><text>Death of the taxpayer or the taxpayer's spouse.</text></clause><clause id="id72F460592A83448AAA78E537B680B27E"><enum>(ii)</enum><text>Divorce of the taxpayer.</text></clause><clause id="idF3441D9423E14783A6B8EE2E7DC6A20C"><enum>(iii)</enum><text>Involuntary conversion of the residence (within the meaning of section 121(d)(5)(A)).</text></clause><clause id="idFD6E2117D3454B1B82D76FF2067BC0C9"><enum>(iv)</enum><text>Relocation of duty station or qualified official extended duty (as defined in section 121(d)(9)(C)) of the taxpayer or the taxpayer's spouse who is a member of the uniformed services (as defined in section 121(d)(9)(C)(ii)), a member of the Foreign Service of the United States (as defined in section 121(d)(9)(C)(iii)), or an employee of the intelligence community (as defined in section 121(d)(9)(C)(iv)).</text></clause><clause id="idD877EDB8648D4FC88562254445FF66F8"><enum>(v)</enum><text>Change of employment of the taxpayer or the taxpayer's spouse which meets the conditions of section 217(c).</text></clause><clause id="idF55883547B0D494AAC15DAB7DCBAEEE1"><enum>(vi)</enum><text>Loss of employment, health conditions, or such other unforeseen circumstances as may be specified by the Secretary.</text></clause></subparagraph></paragraph></subsection><subsection id="id33FE344FF4E24A5F8573E5583DB489F5"><enum>(e)</enum><header>Adjustment to basis</header><text>For purposes of this subtitle, if a credit is allowed under this section with respect to any property, the taxpayer's basis in such property shall be reduced by the amount of the credit so allowed.</text></subsection><subsection id="id141df5df1b5f4db795db59877c7a70d3"><enum>(f)</enum><header>Reporting</header><paragraph id="id9740E3585FA94AF89D340C7F1E6BA7AD"><enum>(1)</enum><header>In general</header><text>A credit shall be allowed under this section only if the following are included on the return of tax:</text><subparagraph id="idCA7C245FF66241DB888FFC285F47D1C1"><enum>(A)</enum><text>The individual's (and, if married, the individual's spouse's) social security number issued by the Social Security Administration.</text></subparagraph><subparagraph id="id7CF831007F0A4E89AABA84240B4E7266"><enum>(B)</enum><text>The street address (not including a post office box) of the principal residence purchased.</text></subparagraph><subparagraph id="id5A3F7381A1C541EFAEB049DCB3625572"><enum>(C)</enum><text>The purchase price of the principal residence.</text></subparagraph><subparagraph id="id2C20161AD78748A4A103C5EAE1D44AEE"><enum>(D)</enum><text>The date of purchase of the principal residence.</text></subparagraph><subparagraph id="idEBFA8A4F3AC84A3995EC167D78B3760E"><enum>(E)</enum><text>The closing disclosure relating to the purchase (in the case of a purchase financed by a mortgage).</text></subparagraph></paragraph><paragraph id="id31F30C9A9994478FAD2807C6039FDEE8"><enum>(2)</enum><header>Reporting of real estate transactions</header><text>If the Secretary requires information reporting under section 6045 by a person described in subsection (e)(2) thereof to verify the eligibility of taxpayers for the credit allowable by this section, the exception provided by section 6045(e)(5) shall not apply.</text></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="idB4EA7CCA14E1426E8CA7504A8DC97F3E"><enum>(b)</enum><header>Conforming amendment relating to basis adjustment</header><text>Subsection (a) of <external-xref legal-doc="usc" parsable-cite="usc/26/1016">section 1016</external-xref> of the Internal Revenue Code of 1986, as amended by section 216, is further amended—</text><paragraph id="id2BBA5FFD863F4F83AF667EE137CAFB60"><enum>(1)</enum><text>by redesignating paragraphs (38) and (39) as paragraphs (39) and (40), respectively; and</text></paragraph><paragraph id="id3DF10A525B9B40A8944303502DB587F0"><enum>(2)</enum><text>by inserting after paragraph (37) the following new paragraph:</text><quoted-block style="OLC" act-name="" id="id6CD4B02239C442F5BC15AF4324B2C444"><paragraph id="id1B5F049385D64B189A0F6D4AADCFCD83"><enum>(38)</enum><text>to the extent provided in section 36(e).</text></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></paragraph></subsection><subsection id="id834F681920964FA2BF43C510DE01482A"><enum>(c)</enum><header>Conforming amendment</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/26">Section 26(b)(2)</external-xref> of the Internal Revenue Code of 1986 is amended by striking subparagraph (W) and by redesignating subparagraphs (X) and (Y) as subparagraphs (W) and (X), respectively.</text></subsection><subsection id="idB1F45390BBBD46BC9964F90018FC0CBD"><enum>(d)</enum><header>Clerical amendment</header><text>The item relating to section 36 in the table of sections for subpart C of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986 is amended to read as follows:</text><quoted-block style="OLC" id="id9643fcb4-cc11-46d1-b03f-62e5a84b0f56"><toc><toc-entry idref="idEC4FC84ABB254672B8DBD384F33D48D6" level="section">Sec. 36. First-time homebuyer refundable credit.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="id910979EFF91440329F14F37948339A55"><enum>(e)</enum><header>Authority To treat claim of credit as error, etc</header><text>Subparagraph (N) of <external-xref legal-doc="usc" parsable-cite="usc/26/6213">section 6213(g)(2)</external-xref> of the Internal Revenue Code of 1986 is amended to read as follows:</text><quoted-block style="OLC" display-inline="no-display-inline" id="idAFAB13274E3C426DB4B502F2298CB4F6"><subparagraph id="id46272243d8624986a19cfbafd87f26cd"><enum>(N)</enum><text>in the case of a return claiming the credit under section 36—</text><clause id="id8ee146607d9b475895ae3e4af61a6873"><enum>(i)</enum><text>the omission of a social security number required under section 36(f)(1)(A),</text></clause><clause id="id06d7e503ec9648ffb4c6d1d79afff423"><enum>(ii)</enum><text>the inclusion of a social security number so required if—</text><subclause id="id5d0240c567b74d15923f35dfaae70235"><enum>(I)</enum><text>the claim of the credit on the return reflects the treatment of such individual as being of an age different from the individual's age based on such social security number, or</text></subclause><subclause id="id9cc3923b2da5461383de3e7c13e95dad"><enum>(II)</enum><text>except as provided in section 36(c)(1)(B), such social security number has been included (other than as a dependent for purposes of section 151) on a return for any previous taxable year claiming any credit or deduction described in section 36(c)(1)(A)(i),</text></subclause></clause><clause id="id07DC3C4BD9814823BE81F246E375AEE7"><enum>(iii)</enum><text>the omission of any other required information or documentation described in section 36(f)(1), including the inclusion of a post office box instead of a street address for the purchased residence,</text></clause><clause id="idC733B94CAB9E49E8A544DCD16A4CD1C8"><enum>(iv)</enum><text>the inclusion of any information or documentation described in clause (iii) if such information or documentation does not support a valid claim for the credit, or</text></clause><clause id="id992e8b76d7324b47a03d8951b4f9ce80"><enum>(v)</enum><text>a claim of such credit for a taxable year with respect to the purchase of a residence made after the last day of such taxable year,</text></clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block></subsection><subsection id="id793213BDA54B4F85A47C4C700A233B92"><enum>(f)</enum><header>IRS recordkeeping</header><text>Notwithstanding the limitations on assessment and collection under <external-xref legal-doc="usc" parsable-cite="usc/26/6501">section 6501</external-xref> of the Internal Revenue Code of 1986, the Commissioner of Internal Revenue shall maintain records of returns and return information (as defined in section 6103(b)(2) of such Code) of any taxpayer claiming the credit under section 36 of such Code (as amended by this section) for the taxable year in which such credit is claimed and succeeding taxable years in the individual master files of the Internal Revenue Service.</text></subsection></section>