[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5181 Introduced in House (IH)]

103d CONGRESS
  2d Session
                                H. R. 5181

To amend section 18 of the United States Housing Act of 1937 to improve 
the program providing for demolition and disposition of public housing.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 5, 1994

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

_______________________________________________________________________

                                 A BILL


 
To amend section 18 of the United States Housing Act of 1937 to improve 
the program providing for demolition and disposition of public housing.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Public Housing Disposition Reform 
Act''.

SEC. 2. DEMOLITION AND DISPOSITION OF PUBLIC HOUSING.

    Section 18 of the United States Housing Act of 1937 (42 U.S.C. 
1437p) is amended to read as follows:

             ``demolition and disposition of public housing

    ``Sec. 18. (a) Condition of Housing.--The Secretary may approve an 
application by a public housing agency for permission to demolish or 
dispose of a public housing project or a portion of a public housing 
project only if the Secretary has determined that--
            ``(1) in the case of--
                    ``(A) an application proposing demolition of a 
                public housing project or a portion of a public housing 
                project, the project or portion of the project is 
                obsolete as to physical condition, location, or other 
                factors, and it is more cost effective to replace the 
                project or portion of the project than to rehabilitate 
                the project or portion of the project; or
                    ``(B) an application proposing the demolition of 
                only a portion of a project, the demolition will help 
                to assure the remaining useful life of the remaining 
                portion of the project;
            ``(2) in the case of an application proposing disposition 
        of real property of a public housing agency by sale or other 
        transfer--
                    ``(A)(i) the property's retention is not in the 
                best interests of the tenants or the public housing 
                agency because--
                            ``(I) developmental changes in the area 
                        surrounding the project adversely affect the 
                        health or safety of the tenants or the feasible 
                        operation of the project by the public housing 
                        agency;
                            ``(II) disposition will allow the 
                        acquisition, development, or rehabilitation of 
                        other properties which will be more efficiently 
                        or effectively operated as low-income housing 
                        and which will (a) preserve the total amount of 
                        low-income housing stock available in the 
                        community, or (b) create housing sufficient to 
                        address the needs of the community as described 
                        in the comprehensive housing affordability 
                        strategy (under section 105 of the Cranston-
                        Gonzalez National Affordable Housing Act), if 
                        such needs are less than the amount needed to 
                        preserve the amount of low-income housing 
                        stock; or
                            ``(III) of other factors which the 
                        Secretary determines are consistent with the 
                        best interests of the tenants and public 
                        housing agency and which are not inconsistent 
                        with other provisions of this Act; and
                    ``(ii) for property other than dwelling units, the 
                property is excess to the needs of a project or the 
                disposition is incidental to, or does not interfere 
                with, continued operation of a project; and
                    ``(B) the net proceeds of the disposition will be 
                used--
                            ``(i) for the payment of development costs 
                        for the replacement housing;
                            ``(ii) to the extent that any proceeds 
                        remain after the application of proceeds in 
                        accordance with clause (i), for the retirement 
                        of outstanding obligations issued to finance 
                        original development or modernization of the 
                        project, which, in the case of scattered-site 
                        housing of a public housing agency, shall be in 
                        an amount that bears the same ratio to the 
                        total of such costs and obligations as the 
                        number of units disposed of bears to the total 
                        number of units of the project at the time of 
                        disposition; and
                            ``(iii) to the extent that any proceeds 
                        remain after the application of proceeds in 
                        accordance with clauses (i) and (ii), the 
                        provision of housing assistance for low-income 
                        families through such measures as modernization 
                        of low-income housing, or the acquisition, 
                        development, or rehabilitation of other 
                        properties to operate as low-income housing; or
            ``(3) in the case of an application proposing demolition or 
        disposition of any portion of a public housing project, 
        assisted at any time under section 5(j)(2)--
                    ``(A) such assistance has not been provided for the 
                portion of the project to be demolished or disposed 
                within the 10-year period ending upon submission of the 
                application; or
                    ``(B) the property's retention is not in the best 
                interest of the tenants or the public housing agency 
                because of changes in the area surrounding the project 
                or other circumstances of the project, as determined by 
                the Secretary.
    ``(b) Tenant Involvement and Replacement Housing.--The Secretary 
may approve an application or furnish assistance under this section or 
under this Act only if the following requirements are met:
            ``(1) Tenant consultation and employment.--The application 
        from the public housing agency--
                    ``(A) has been developed in consultation with 
                tenants and tenant councils, if any, who will be 
                affected by the demolition or disposition;
                    ``(B) includes a plan to employ public housing 
                tenants in construction or rehabilitation to the extent 
                practicable, pursuant to section 3 of the Housing and 
                Urban Development Act of 1968; and
                    ``(C) contains a certification by appropriate local 
                government officials that the proposed activity is 
                consistent with the applicable comprehensive housing 
                affordability strategy.
            ``(2) Relocation assistance.--All tenants to be relocated 
        as a result of the demolition or disposition will be provided 
        assistance by the public housing agency and are relocated to 
        other decent, safe, sanitary, and affordable housing, which is, 
        to the maximum extent practicable, housing of their choice, 
        including housing assisted under section 8 of this Act.
            ``(3) Replacement housing.--Except as provided under 
        subsections (c)(1) and (i), the public housing agency has 
        developed, and the Secretary has approved, a plan that provides 
        for additional decent, safe, sanitary, and affordable dwelling 
        units for each public housing dwelling unit to be demolished or 
        disposed under such application. Such a plan--
                    ``(A) shall provide for the provision of such 
                additional dwelling units through--
                            ``(i) the acquisition or development of 
                        additional public housing dwelling units;
                            ``(ii) the use of 15-year project-based 
                        assistance under section 8;
                            ``(iii) in the case of an application 
                        proposing demolition or disposition of 200 or 
                        more units, the use of tenant-based assistance 
                        under section 8 having a term of not less than 
                        5 years;
                            ``(iv) for not more than 10 percent of the 
                        replacement units, units acquired or otherwise 
                        provided for homeownership (including 
                        cooperative and condominium interests) by 
                        public housing tenants under section 5(h), 
                        subtitle B or C of title IV of the Cranston-
                        Gonzalez National Affordable Housing Act, or 
                        other programs for homeownership that have 
                        program requirements substantially equivalent 
                        to the requirements established under section 
                        605 of the Housing and Community Development 
                        Act of 1987;
                            ``(v) for not more than 10 percent of the 
                        replacement units, affordable housing 
                        homeownership units assisted under title II of 
                        the Cranston-Gonzalez National Affordable 
                        Housing Act and sold to public housing tenants;
                            ``(vi) rental units that are assisted 
                        under--
                                    ``(I) title II of the Cranston-
                                Gonzalez National Affordable Housing 
                                Act (notwithstanding section 212(d)(2) 
                                of such Act), or
                                    ``(II) a State or local rental 
                                assistance program that provides for 
                                rental assistance that is comparable in 
                                terms of eligibility and contribution 
                                to rent to assistance under section 8;
                        except that, if such assistance is project-
                        based, the units shall be provided such 
                        assistance for a term of not less than 15 years 
                        and, if such assistance is tenant-based, the 
                        units shall be provided such assistance for a 
                        term of not less than 5 years;
                            ``(vii) project-based assistance under any 
                        other Federal program, which has a term of not 
                        less than 15 years, including housing assisted 
                        by a tax credit under section 42 of the 
                        Internal Revenue Code;
                            ``(viii) another method approved by the 
                        Secretary; or
                            ``(ix) any combination of such methods;
                    ``(B) in the case of an application proposing 
                demolition or disposition of 200 or more units, shall 
                provide that--
                            ``(i) not less than 50 percent of such 
                        additional dwelling units shall be provided 
                        through the acquisition or development of 
                        additional dwelling units or through project-
                        based assistance; and
                            ``(ii) not more than 50 percent of such 
                        additional dwelling units shall be provided 
                        through tenant-based assistance under section 8 
                        having a term of not less than 5 years;
                    ``(C) if providing for the use of tenant-based 
                assistance under section 8 or otherwise, may be 
                approved by the Secretary only if--
                            ``(i) the Secretary finds that--
                                    ``(I) the supply of private rental 
                                housing available to families who would 
                                receive such assistance under the plan 
                                is sufficient for the total number of 
                                units that will be available for 
                                tenant-based assistance under section 8 
                                or otherwise in the programs of the 
                                public housing agency after 
                                implementation of the plan; and
                                    ``(II) on the basis of experience 
                                with tenant-based assistance program in 
                                the jurisdiction of the public housing 
                                agency, there is a reasonable 
                                expectation that the families who 
                                receive such assistance will be housed 
                                in accordance with program 
                                requirements; and
                            ``(ii) the finding under clause (i) is 
                        based on factors that the Secretary shall 
                        determine, which shall include the rental 
                        vacancy rate in the market area, the 
                        availability of housing of appropriate quality, 
                        size, and price in the market area, the success 
                        rate of families receiving such assistance from 
                        the public housing agency in leasing a unit 
                        under tenant-based assistance programs, and the 
                        overall administrative ability of the agency in 
                        administering such programs;
                    ``(D) may provide that all or part of such 
                additional dwelling units may be located outside the 
                jurisdiction of the public housing agency (in this 
                subparagraph referred to as the `original agency') if--
                            ``(i) the location is in the same housing 
                        market area as the original agency, as 
                        determined by the Secretary; and
                            ``(ii) the plan contains an agreement 
                        between the original agency and the public 
                        housing agency in the alternate location or 
                        other public or private entity that will be 
                        responsible for providing the additional units 
                        in the alternate location that such alternate 
                        agency or entity will, with respect to the 
                        dwelling units involved--
                                    ``(I) provide the dwelling units in 
                                accordance with subparagraph (A);
                                    ``(II) complete the plan on 
                                schedule in accordance with 
                                subparagraph (E);
                                    ``(III) meet the requirements of 
                                subparagraph (F) of this paragraph and 
                                the maximum rent provisions of 
                                subparagraph (G); and
                                    ``(IV) not impose a local residency 
                                preference on any resident of the 
                                jurisdiction of the original agency for 
                                purposes of admission to any such 
                                units;
                    ``(E) includes a schedule for completing the plan 
                within a period consistent with the number of dwelling 
                units subject to the proposed demolition or disposition 
                and replacement plan, which--
                            ``(i) shall not exceed 6 years, except that 
                        the Secretary may extend the schedule to not 
                        more than 10 years if the Secretary determines 
                        that good cause exists to extend the 
                        implementation of the replacement plan under 
                        this subsection; and
                            ``(ii) the demolition or disposition under 
                        the plan can occur in phases necessary to 
                        provide for relocation of tenants under 
                        paragraph (2);
                    ``(F) includes a method of ensuring that the same 
                number of individuals and families will be provided 
                housing;
                    ``(G) provides for the payment of the relocation 
                expenses of each tenant to be displaced and ensures 
                that the rent paid by the tenant following relocation 
                will not exceed the amount permitted under this Act;
                    ``(H) prevents the taking of any action to demolish 
                or dispose of any unit until the tenant of the unit is 
                relocated to decent, safe, sanitary, and affordable 
                housing; and
                    ``(I) permits the Secretary to intervene and take 
                any actions necessary to complete the plan if the 
                public housing agency fails, without good cause, to 
                carry out its obligations under the plan.
    ``(c) Limitation on Demolition and Exemption.--
            ``(1) Maximum percentage.--Notwithstanding subsection 
        (b)(3), in any 5-year period a public housing agency may 
        demolish not more than the lesser of 5 dwelling units or 5 
        percent of the total dwelling units owned and operated by the 
        public housing agency, without providing an additional dwelling 
        unit for each such public housing dwelling unit to be 
        demolished, but only if the space occupied by the demolished 
        unit is used for meeting the service or other needs of public 
        housing tenants or the demolished unit was beyond repair.
            ``(2) Site and neighborhood standards exemption.--
        Notwithstanding any other provision of law, a replacement plan 
        under subsection (b)(3) may provide for demolition of public 
        housing units and replacement of such units on site or in the 
        same neighborhood if the number of replacement units provided 
        in the same neighborhood is significantly fewer than the number 
        of units demolished.
    ``(d) Treatment of Replacement Units.--With respect to any dwelling 
units developed, acquired, or leased by a public housing agency 
pursuant to a replacement plan under subsection (b)(3)--
            ``(1) assistance may be provided under section 9 for such 
        units; and
            ``(2) such units shall be available for occupancy, operated 
        and managed in the manner required for public housing, and 
        shall be subject to the other requirements applicable to public 
        housing dwelling units.
    ``(e) Approval of Applications.--
            ``(1) In general.--The Secretary shall notify a public 
        housing agency submitting an application under this section for 
        demolition or disposition and replacement of a public housing 
        project or portion of a project of the approval or disapproval 
        of the application not later than 60 days after receiving the 
        application. If the Secretary does not notify the public 
        housing agency as required under this paragraph or paragraph 
        (2), the application shall be considered to have been approved.
            ``(2) Disapproval and resubmission.--If the Secretary 
        disapproves an application, the Secretary shall specify in the 
        notice of disapproval the reasons for the disapproval and the 
        agency may resubmit the application as amended or modified.
            ``(3) Annual report.--The Secretary shall submit a report 
        to the Congress annually describing for the year the 
        applications under this section approved and disapproved, the 
        number, general condition, and location of units demolished or 
        disposed of, and the number, general condition, location and 
        method of provision of units of replacement housing provided 
        pursuant to this section.
    ``(f) Action Without Approval of Application.--
            ``(1) Prohibited action.--A public housing agency shall not 
        take any action to demolish or dispose of a public housing 
        project or a portion of a public housing project without 
        obtaining the approval of the Secretary and satisfying the 
        conditions specified in subsections (a) and (b).
            ``(2) Allowable actions.--If public housing dwelling units 
        to be demolished or disposed of under this section are not 
        decent, safe, and sanitary or public housing dwelling units to 
        be rehabilitated under section 14 or 24 or the HOPE VI urban 
        revitalization demonstration program (pursuant to Public Law 
        102-389 (106 Stat. 1579)) cannot be maintained cost-effectively 
        in a decent, safe, and sanitary condition, the public housing 
        agency may relocate tenants of such dwelling units into other 
        dwelling units or cease leasing such units before the approval 
        of an application under this section for demolition or 
        disposition of such units or before implementing the plan for 
        modernization of such units.
    ``(g) Assistance for Replacement Housing.--The Secretary may 
provide assistance under this subsection for--
            ``(1) providing replacement public housing units pursuant 
        to subsection (b)(3)(A) for units demolished or disposed of 
        pursuant to this section; and
            ``(2) providing assistance under section 8 for replacement 
        housing pursuant to subsection (b)(3)(A) for units demolished 
        or disposed of pursuant to this section.
    ``(h) Inapplicability to Public Housing Homeownership Program.--The 
provisions of this section shall not apply to the disposition of a 
public housing project in accordance with an approved homeownership 
program under this Act.
    ``(i) Exceptions to Replacement Housing Requirement.--
            ``(1) Waiver.--The Secretary shall waive the applicability 
        of the provisions of subsection (b)(3) and (c)(1) with respect 
        to an application under this section by a public housing agency 
        for the demolition or disposition of public housing dwelling 
        units if--
                    ``(A) the Secretary determines, based on the number 
                of families on the waiting list for public housing 
                dwelling units of the public housing agency, vacancy 
                rates, the comprehensive housing affordability strategy 
                (if applicable), and other available information 
                relating to low-income housing needs within the 
                jurisdiction of the agency, that no need exists for 
                additional low-income housing in the jurisdiction of 
                the agency; or
                    ``(B)(i) the Secretary determines, based on such 
                factors as the vacancy rate for public housing dwelling 
                units of the agency, the number of families on the 
                waiting list for public housing dwelling units of the 
                agency, the availability of funding under section 14, 
                and the assessment of the management performance of the 
                agency under section 6(j), that the need for additional 
                low-income housing in the community can be met by the 
                agency through the rehabilitation of vacant public 
                housing dwelling units in accordance with section 14; 
                and
                    ``(ii) the application under subsection (a) 
                includes a commitment by the public housing agency to 
                rehabilitate the requisite units within a period 
                consistent with the extent of the proposed demolition 
                or disposition, which period shall not exceed 6 years, 
                except that the Secretary may, upon a determination of 
                good cause, approve a commitment for rehabilitation 
                during a period not exceeding 10 years.
            ``(2) Waiver and alternative replacement housing.--
        Notwithstanding any other provision of this section, the 
        Secretary shall waive the applicability of the provisions of 
        subsection (b)(3) with respect to an application under this 
        section by a public housing agency for the demolition or 
        disposition of public housing dwelling units if--
                    ``(A) the Secretary determines that the agency 
                cannot meet some or all of the requirements under 
                subsection (b)(3) to provide replacement housing with 
                project-based assistance because of--
                            ``(i) the high cost of acquiring real 
                        estate for development or rehabilitation for 
                        low-income housing in areas that are not 
                        racially or economically impacted or are not 
                        impacted by adverse environmental conditions; 
                        or
                            ``(ii) other factors determined by the 
                        Secretary; and
                    ``(B) the agency applies for and the Secretary 
                approves the use of tenant-based assistance under 
                section 8 having a term of not less than 5 years for 
                any portion of the replacement housing required under 
                subsection (b)(3) that the Secretary determines under 
                subparagraph (A) cannot be provided through project-
                based assistance.
            ``(3) Request for waiver.--To be eligible for a waiver 
        under paragraph (1) or (2), a public housing agency shall 
        submit to the Secretary a request for a waiver under this 
        subsection that includes--
                    ``(A) a comprehensive plan for demolition, 
                disposition, and replacement that describes additional 
                dwelling units to be made available by the public 
                housing agency;
                    ``(B) an identification of the dwelling units for 
                which the waiver is requested; and
                    ``(C) an assessment of the need for replacing such 
                dwelling units including the unit size, age, general 
                condition, and length of time such units have been 
                vacant, the condition of the neighborhood in which the 
                dwelling units are located, and the availability of 
                dwelling units affordable to low-income families within 
                the jurisdiction in which the dwelling units are 
                located, during the implementation of the replacement 
                plan.
            ``(4) Submission to secretary.--A request for a waiver 
        under this subsection may be submitted at any time. The request 
        shall be submitted to the Secretary by certified mail or any 
        other equivalent means that provides notification to the public 
        housing agency making the request of the date of receipt by the 
        Secretary.
            ``(5) Notice of disposition of request.--Except as provided 
        in paragraph (6), the Secretary shall notify a public housing 
        agency requesting a waiver under this section of the approval 
        or disapproval of the request not later than 45 days after 
        receiving the request. If the Secretary does not notify the 
        public housing agency as required under this paragraph or 
        paragraph (6), the request for a waiver shall be considered to 
        have been approved.
            ``(6) Request for additional information.--If the Secretary 
        determines that more information is needed to make the 
        determinations required under paragraph (1) or (2) than has 
        been provided by the public housing agency, the Secretary shall 
        notify the agency in writing not later than 30 days after 
        receiving the request for the waiver that additional 
        information is necessary. Such notice shall describe 
        specifically the additional information required for the 
        determinations and establish a deadline for the submission of 
        the information by the agency, which shall be determined based 
        on the difficulty of obtaining the information requested. If 
        the agency submits such additional information requested before 
        the deadline established in the notice under this paragraph, 
        the Secretary shall notify the agency requesting the waiver 
        that the request is approved or disapproved not later than 30 
        days after the submission of such additional information.
            ``(7) Statement of reasons for denying or approving 
        request.--The Secretary shall include, in each notice under 
        paragraph (5) or (6) of the denial or approval of a request for 
        a waiver under this subsection, the specific reasons for 
        denying or approving the request. The denial of any request for 
        a waiver for public housing dwelling units shall not prejudice 
        the consideration of any other subsequent request for such a 
        waiver for any of such dwelling units.''.
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