[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2406 Introduced in House (IH)]







104th CONGRESS
  1st Session
                                H. R. 2406

To repeal the United States Housing Act of 1937, deregulate the public 
 housing program and the program for rental housing assistance for low-
income families, and increase community control over such programs, and 
                          for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 27, 1995

Mr. Lazio of New York (for himself, Mr. Leach, Mr. McCollum, Mr. Baker 
   of Louisiana, Mr. Castle, Mr. Weller, Mr. Bono, Mr. Ehrlich, Mr. 
   Cremeans, Mr. Fox of Pennsylvania, Mr. Heineman, and Mrs. Kelly) 
 introduced the following bill; which was referred to the Committee on 
                     Banking and Financial Services

_______________________________________________________________________

                                 A BILL


 
To repeal the United States Housing Act of 1937, deregulate the public 
 housing program and the program for rental housing assistance for low-
income families, and increase community control over such programs, and 
                          for other purposes.

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

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``United States 
Housing Act of 1995''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title and table of contents.
Sec. 2. Declaration of policy to renew American neighborhoods.
                      TITLE I--GENERAL PROVISIONS

Sec. 101. Statement of purpose.
Sec. 102. Definitions.
Sec. 103. Organization of local housing and management authorities.
Sec. 104. Determination of adjusted income.
Sec. 105. Limitation on admission of drug or alcohol abusers to 
                            assisted housing.
Sec. 106. Community work and family self-sufficiency requirement.
Sec. 107. Community improvement plans.
Sec. 108. Review of plans.
Sec. 109. Headquarters reserve fund.
Sec. 110. Labor standards.
Sec. 111. Nondiscrimination.
Sec. 112. Effective date and regulations.
                        TITLE II--PUBLIC HOUSING

                        Subtitle A--Block Grants

Sec. 201. Block grant contracts.
Sec. 202. Block grant authority and amount.
Sec. 203. Eligible and required activities.
Sec. 204. Determination of block grant allocation.
Sec. 205. Sanctions for improper use of amounts.
           Subtitle B--Admissions and Occupancy Requirements

Sec. 221. Low-income housing requirement.
Sec. 222. Family income eligibility.
Sec. 223. Preferences for occupancy.
Sec. 224. Admission procedures.
Sec. 225. Family rental payment.
Sec. 226. Lease requirements.
Sec. 227. Designated housing for elderly and disabled families.
                         Subtitle C--Management

Sec. 231. Management procedures.
Sec. 232. Administrative grievance procedure.
Sec. 233. Housing quality requirements.
Sec. 234. Employment of residents.
Sec. 235. Resident councils and resident management corporations.
Sec. 236. Management by resident management corporation.
Sec. 237. Transfer of management of certain housing to independent 
                            manager at request of residents.
                       Subtitle D--Homeownership

Sec. 251. Resident homeownership programs.
         Subtitle E--Disposition and Demolition of Developments

Sec. 261. Requirements for demolition and disposition of developments.
                     Subtitle F--General Provisions

Sec. 271. Conversion to block grant assistance.
Sec. 272. Payment of non-Federal share.
Sec. 273. Definitions.
Sec. 274. Authorization of appropriations.
TITLE III--CHOICE-BASED RENTAL HOUSING AND HOMEOWNERSHIP ASSISTANCE FOR 
                          LOW-INCOME FAMILIES

                   Subtitle A--Grants and Allocation

Sec. 301. Authority to provide housing assistance grants.
Sec. 302. Grant agreements.
Sec. 303. Allocation of amounts.
Sec. 304. Administrative fees.
Sec. 305. Authorizations of appropriations.
Sec. 306. Conversion of section 8 assistance.
   Subtitle B--Choice-Based Housing Assistance for Eligible Families

Sec. 321. Eligible families and preferences for assistance.
Sec. 322. Resident contribution.
Sec. 323. Rental indicators.
Sec. 324. Lease terms.
Sec. 325. Termination of tenancy.
Sec. 326. Eligible owners.
Sec. 327. Selection of dwelling units.
Sec. 328. Eligible dwelling units.
Sec. 329. Homeownership option.
Sec. 330. Administrative grievance procedure.
    Subtitle C--Payment of Housing Assistance on Behalf of Assisted 
                                Families

Sec. 351. Housing assistance payments contracts.
Sec. 352. Amount of monthly assistance payment.
Sec. 353. Payment standards.
Sec. 354. Reasonable rents.
Sec. 355. Prohibition of assistance for vacant rental units.
Sec. 356. Prohibition of portability.
            Subtitle D--General and Miscellaneous Provisions

Sec. 371. Definitions.
Sec. 372. Rental assistance fraud recoveries.
   Subtitle E--Provisions Relating to Discontinued HUD-Administered 
                 Programs for Project-Based Assistance

Sec. 381. Prohibition of discrimination in subsidized projects.
 TITLE IV--ACCREDITATION AND OVERSIGHT OF LOCAL HOUSING AND MANAGEMENT 
                              AUTHORITIES

         Subtitle A--Housing Foundation and Accreditation Board

Sec. 401. Establishment.
Sec. 402. Membership.
Sec. 403. Functions.
Sec. 404. Initial establishment of standards and procedures for LHMA 
                            compliance.
Sec. 405. Powers.
Sec. 406. Fees.
Sec. 407. Reports.
    Subtitle B--Accreditation and Oversight Standards and Procedures

Sec. 431. Establishment of performance benchmarks and accreditation 
                            procedures.
Sec. 432. Annual financial and performance audit.
Sec. 433. Annual classification by performance category.
Sec. 434. Accreditation.
Sec. 435. Performance agreements for troubled authorities.
Sec. 436. Option to demand conveyance of title to or possession of 
                            public housing.
Sec. 437. Removal of ineffective LHMA's.
Sec. 438. Mandatory takeover of chronically troubled PHA's.
Sec. 439. Treatment of troubled PHA's.
Sec. 438. Maintenance of and access to records.
Sec. 440. Annual reports regarding troubled LHMA's.
Sec. 442. Applicability to resident management corporations.
Sec. 443. Inapplicability to Indian housing.
               TITLE V--REPEALS AND CONFORMING AMENDMENTS

Sec. 501. Repeals.
Sec. 502. Conforming provisions.

SEC. 2. DECLARATION OF POLICY TO RENEW AMERICAN NEIGHBORHOODS.

    The Congress hereby declares that--
            (1) the Federal Government has a responsibility to promote 
        the general welfare of the Nation--
                    (A) by using Federal resources to aid families and 
                individuals seeking affordable homes that are safe, 
                clean, and healthy and, in particular, assisting 
                responsible, deserving citizens who cannot provide 
                fully for themselves because of temporary circumstances 
                or factors beyond their control;
                    (B) by working to ensure a thriving national 
                economy and a strong private housing market; and
                    (C) by developing effective partnerships among the 
                Federal Government, State and local governments, and 
                private entities that allow government to accept 
                responsibility for fostering the development of a 
                healthy marketplace and allow families to prosper 
                without government involvement in their day-to-day 
                activities;
            (2) the Federal Government cannot through its direct action 
        or involvement provide for the housing of every American 
        citizen, or even a majority of its citizens, but it is the 
        responsibility of the Government to promote and protect the 
        independent and collective actions of private citizens to 
        develop housing and strengthen their own neighborhoods;
            (3) the Federal Government should act only where there is a 
        serious need that private citizens or groups cannot or are not 
        addressing responsibly; and
            (4) merely providing physical structures to house low-
        income families will not pull generations up from poverty, but 
        housing is a fundamental component of bringing true opportunity 
        to people and communities in need.

                      TITLE I--GENERAL PROVISIONS

SEC. 101. STATEMENT OF PURPOSE.

    The purpose of this Act is to promote housing opportunities that 
are affordable to low-income families by--
            (1) deregulating and decontrolling public housing agencies, 
        which in this Act are referred to as ``local housing and 
        management authorities'', and thereby enable them to perform as 
        property and asset managers;
            (2) providing for more flexible use of Federal assistance 
        to local housing and management authorities, allowing the 
        authorities to leverage and combine assistance amounts with 
        amounts obtained from other sources;
            (3) facilitating mixed income communities;
            (4) increasing accountability and rewarding effective 
        management of local housing and management authorities;
            (5) creating incentives for residents of dwelling units 
        assisted by local housing and management authorities to work; 
        and
            (6) recreating the existing rental assistance voucher 
        program so that the use of vouchers and relationships between 
        landlords and tenants under the program operate in a manner 
        that more closely resembles the private housing market.

SEC. 102. DEFINITIONS.

    For purposes of this Act, the following definitions shall apply:
            (1) Community improvement plan.--The term ``community 
        improvement plan'' means, with respect to any fiscal year, the 
        plan under section 107 of a local housing and management 
        authority for such fiscal year.
            (2) Disabled family.--The term ``disabled family'' means a 
        family whose head (or his or her spouse), or whose sole member, 
        is a person with disabilities. Such term includes 2 or more 
        persons with disabilities living together, and 1 or more such 
        persons living with 1 or more persons determined under the 
        regulations of the Secretary to be essential to their care or 
        well-being.
            (3) Drug-related criminal activity.--The term ``drug-
        related criminal activity'' means the illegal manufacture, 
        sale, distribution, use, or possession with intent to 
        manufacture, sell, distribute, or use, of a controlled 
        substance (as such term is defined in section 102 of the 
        Controlled Substances Act).
            (4) Elderly families and near elderly families.--The terms 
        ``elderly family'' and ``near-elderly family'' mean a family 
        whose head (or his or her spouse), or whose sole member, is an 
        elderly person or a near-elderly person, respectively. Such 
        terms include 2 or more elderly persons or near-elderly persons 
        living together, and 1 or more such persons living with 1 or 
        more persons determined under the regulations of the Secretary 
        to be essential to their care or well-being.
            (5) Elderly person.--The term ``elderly person'' means a 
        person who is at least 62 years of age.
            (6) Family.--The term ``family'' includes a family with or 
        without children, an elderly family, a near-elderly family, a 
        disabled family, and a single person.
            (7) Local housing and management authority.--The term 
        ``local housing and management authority'' is defined in 
        section 103.
            (8) Income.--The term ``income'' means, with respect to a 
        family, income from all sources of each member of the 
        household, as determined in accordance with criteria prescribed 
        by the applicable local housing and management authority and 
        the Secretary, except that the following amounts shall be 
        excluded:
                    (A) Any amounts not actually received by the 
                family.
                    (B) Any amounts that would be eligible for 
                exclusion under section 1613(a)(7) of the Social 
                Security Act.
            (9) Indian.--The term ``Indian'' means any person 
        recognized as being an Indian, Alaska Native, or Native 
        Hawaiian by an Indian tribe, the Federal Government, or any 
        State.
            (10) Indian area.--The term ``Indian area'' means the area 
        within which an Indian housing authority is authorized to 
        provide low-income housing assistance under this Act.
            (11) Indian housing authority.--The term ``Indian housing 
        authority'' means any entity that--
                    (A) is authorized to engage in or assist in the 
                production or operation of low-income housing for 
                Indians that is assisted under this Act; and
                    (B) is established--
                            (i) by exercise of the power of self-
                        government of an Indian tribe independent of 
                        State law; or
                            (ii) by operation of State law providing 
                        specifically for housing authorities for 
                        Indians, including regional housing authorities 
                        in the State of Alaska.
            (12) Indian tribe.--The term ``Indian tribe'' means any 
        tribe, band, pueblo, group, community, or nation of Indians, 
        Alaska Natives, or Native Hawaiians.
            (13) Low-income family.--The term ``low-income family'' 
        means a family whose income does not exceed 80 percent of the 
        median income for the area, except that a local housing and 
        management authority may, for purposes of this paragraph, 
        establish income ceilings higher or lower than 80 percent of 
        the median for the area on the basis of the authority's 
        findings that such variations are necessary because of 
        unusually high or low family incomes.
            (14) Low-income housing.--The term ``low-income housing'' 
        means dwellings that comply with the requirements--
                    (A) under subtitle B of title II for assistance 
                under such title for the dwellings; or
                    (B) under title III for rental assistance payments 
                under such title for the dwellings.
            (15) Near-elderly person.--The term ``near-elderly person'' 
        means a person who is at least 55 years of age.
            (16) Person with disabilities.--The term ``person with 
        disabilities'' means a person who--
                    (A) has a disability as defined in section 223 of 
                the Social Security Act; or
                    (B) has a developmental disability as defined in 
                section 102 of the Developmental Disabilities 
                Assistance and Bill of Rights Act.
        Such term shall not exclude persons who have the disease of 
        acquired immunodeficiency syndrome or any conditions arising 
        from the etiologic agent for acquired immunodeficiency 
        syndrome.
            (17) Public housing.--The term ``public housing'' means 
        housing, and all necessary appurtenances thereto, that--
                    (A) is low-income housing or low-income dwelling 
                units in mixed income housing (as provided in section 
                221(c)(2)); and
                    (B)(i) is subject to an annual block grant contract 
                under title II; or
                    (ii) was subject to an annual block grant contract 
                under title II (or an annual contributions contract 
                under the United States Housing Act of 1937) which is 
                not in effect, but for which occupancy is limited in 
                accordance with the requirements under section 222(a).
            (18) Secretary.--The term ``Secretary'' means the Secretary 
        of Housing and Urban Development.
            (19) State.--The term ``State'' means the States of the 
        United States, the District of Columbia, the Commonwealth of 
        Puerto Rico, the Commonwealth of the Northern Mariana Islands, 
        Guam, the Virgin Islands, American Samoa, any other territory 
        or possession of the United States, and Indian tribes.
            (20) Very low-income family.--The term ``very low-income 
        family'' means a low-income family whose income does not exceed 
        50 percent of the median family income for the area, except 
        that a local housing and management authority may, for purposes 
        of this paragraph, establish income ceilings higher or lower 
        than 50 percent of the median for the area on the basis of the 
        authority's findings that such variations are necessary because 
        of unusually high or low family incomes.

SEC. 103. ORGANIZATION OF LOCAL HOUSING AND MANAGEMENT AUTHORITIES.

    (a) Requirements.--For purposes of this Act, the terms ``local 
housing and management authority'' and ``authority'' mean any entity 
that--
            (1) is--
                    (A) a public housing agency or Indian housing 
                authority that was authorized under the United States 
                Housing Act of 1937 to engage in or assist in the 
                development or operation of low-income housing;
                    (B) authorized under this Act to engage in or 
                assist in the development or operation of low-income 
                housing by any State, county, municipality, or other 
                governmental body or public entity; or
                    (C) an entity selected by the Secretary, pursuant 
                to subtitle B of title IV, to manage housing; and
            (2) complies with the requirements under subsection (b).
    (b) Governance.--
            (1) Board of directors.--Each local housing and management 
        authority shall have a board of directors or other form of 
        governance as prescribed in State or local law. No person may 
        be barred from serving on such board or body because of such 
person's residency in a public housing project.
            (2) Resident membership.--
                    (A) In general.--Except as provided in subparagraph 
                (B), in localities in which a local housing and 
                management authority is governed by a board of 
                directors or other similar body, the board or body 
                shall include not less than 1 member who--
                            (i) is (I) a resident of a public housing 
                        dwelling unit owned or operated by the 
                        authority, or (II) a member of an assisted 
                        family under title III; and
                            (ii) is elected by residents of such public 
                        housing dwelling units and assisted families.
                    (B) Exceptions.--The requirement in subparagraph 
                (A) with respect to a resident member shall not apply 
                to--
                            (i) any State or local governing body that 
                        serves as a local housing and management 
                        authority for purposes of this Act and whose 
                        responsibilities include substantial activities 
                        other than acting as the local housing and 
                        management authority, except that such 
                        requirement shall apply to any advisory 
                        committee or organization that is established 
                        by such governing body and whose 
                        responsibilities relate only to the governing 
                        body's functions as a local housing and 
                        management authority for purposes of this Act;
                            (ii) any local housing and management 
                        authority that owns or operates less than 250 
                        public housing dwelling units (including any 
                        authority that does not own or operate public 
                        housing); or
                            (iii) any local housing and management 
                        authority that manages public housing 
                        consisting primarily of scattered site public 
                        housing.
            (3) Full participation.--No local housing and management 
        authority may limit or restrict the capacity or offices in 
        which a member of such board or body may serve on such board or 
        body solely because of the member's status as a resident 
        member.
            (4) Conflicts of interest.--The Secretary shall establish 
        guidelines to prevent conflicts of interest on the part of 
        members of the board or directors or governing body of a local 
        housing and management authority.
            (5) Definition.--For purposes of this subsection, the term 
        ``resident member'' means a member of the board of directors or 
        other similar governing body of a local housing and management 
        authority who is a resident of a public housing dwelling unit 
        administered or assisted by the authority or is an assisted 
        family (as such term is defined in section 371).
    (c) Establishment of Policies.--Any rules, regulations, policies, 
standards, and procedures necessary to implement policies required 
under section 107 to be included in the community improvement plan for 
a local housing and management authority shall be approved by the board 
of directors or similar governing body of the authority and shall be 
publicly available for review upon request.

SEC. 104. DETERMINATION OF ADJUSTED INCOME.

    (a) In General.--For purposes of this Act, the term ``adjusted 
income'' means, with respect to a family, the difference between the 
income of the members of the family residing in a dwelling unit or the 
persons on a lease and the amount of any income exclusions for the 
family under subsections (b) and (c), as determined by the local 
housing and management authority.
    (b) Mandatory Exclusions From Income.--In determining adjusted 
income, a local housing and management authority shall exclude from the 
annual income of a family the following amounts:
            (1) Elderly and disabled families.--$400 for any elderly or 
        disabled family.
            (2) Medical expenses.--The amount by which 3 percent of the 
        annual family income is exceed by the sum of--
                    (A) unreimbursed medical expenses of the family; 
                and
                    (B) unreimbursed reasonable attendant care and 
                auxiliary apparatus expenses for each handicapped 
                member of the family, to the extent necessary to enable 
                any member of such family (including such handicapped 
                member) to be employed.
            (3) Child care expenses.--Any reasonable child care 
        expenses necessary to enable a member of the family to be 
        employed or to further his or her education.
    (c) Permissive Exclusions From Income.--In determining adjusted 
income, a local housing and management authority may, in the discretion 
of the authority, establish exclusions from the annual income of a 
family. Such exclusions may include the following amounts:
            (1) Minors.--$480 for each member of the family residing in 
        the household (other than the head of the household or his 
        spouse) who is under 18 years or age, or who is 18 years of age 
        or older and is disabled, handicapped, or a full-time student.
            (2) Excessive travel expenses.--Excessive travel expenses 
        in an amount not to exceed $25 per family per week, for 
        employment- or education-related travel.
            (3) Earned income.--An amount of any earned income of the 
        family, established at the discretion of the local housing and 
        management authority, which may be based on--
                    (A) all earned income of the family,
                    (B) the amount earned by particular members of the 
                family;
                    (C) the amount earned by families having certain 
                characteristics; or
                    (D) the amount earned by families or members during 
                certain periods or from certain sources.
            (4) Others.--Such other amounts for other purposes, as the 
        local housing and management authority may establish.

SEC. 105. LIMITATION ON ADMISSION OF DRUG OR ALCOHOL ABUSERS TO 
              ASSISTED HOUSING.

    Notwithstanding any other provision of law, a local housing and 
management authority may establish standards for occupancy in public 
housing dwelling units and assistance under title III, that prohibit 
admission to such units and assistance under title III by any person 
whose current illegal use or history of illegal use of a controlled 
substance or whose use of alcohol provides reasonable cause for the 
authority to believe that the occupancy by such person may interfere 
with the health, safety, or right to peaceful enjoyment of the premises 
by other residents.

SEC. 106. COMMUNITY WORK AND FAMILY SELF-SUFFICIENCY REQUIREMENT.

    (a) Requirement.--Each local housing and management authority shall 
require, as a condition of occupancy of a public housing dwelling unit 
by a family and of providing housing assistance under title III on 
behalf of a family, that each adult member of the family shall--
            (1) contribute not less than 8 hours of work per month 
        within the community in which the family resides; or
            (2) participate on an ongoing basis in a program designed 
        to promote economic self-sufficiency.
    (b) Exemptions.--A local housing and management authority may 
provide for the exemption, from the applicability of the requirement 
under subsection (a), of each individual who is--
            (1) an elderly person;
            (2) a person with disabilities and unable, as determined in 
        accordance with guidelines established by the Secretary, to 
        comply with the requirement; or
            (3) working, attending school or vocational training, or 
        otherwise complying with work requirements applicable under 
        other public assistance programs.

SEC. 107. COMMUNITY IMPROVEMENT PLANS.

    (a) In General.--In accordance with this section, the Secretary 
shall provide for each local housing and management authority to submit 
to the Secretary a community improvement plan under this section for 
each fiscal year that describes the mission of the local housing and 
management authority and the goals, objectives, and policies of the 
authority to meet the housing needs of low-income families in the 
jurisdiction of the authority.
    (b) Procedures.--The Secretary shall establish requirements and 
procedures for submission and review of plans and for the contents of 
such plans. Such procedures shall provide for local housing and 
management authorities to, at the option of the authority, submit plans 
under this section together with, or as part of, the comprehensive 
housing affordability strategy under section 105 of the Cranston-
Gonzalez National Affordable Housing Act for the relevant jurisdiction 
and for concomitant review of such plans.
    (c) Contents.--A community improvement plan under this section for 
a local housing and management authority shall contain the following 
information relating to the upcoming fiscal year for which the 
assistance under this Act is to be made available:
            (1) Financial resources.--An operating budget for the 
        authority that includes--
                    (A) a description of the financial resources 
                available to the authority;
                    (B) the uses to which such resources will be 
                committed, including eligible and required activities 
                under section 203 to be assisted, housing assistance to 
                be provided under title III, and administrative, 
                management, maintenance, capital improvement activities 
                to be carried out; and
                    (C) an estimate of the market value of each public 
                housing development of the authority.
            (2) Population served.--A statement of the policies of the 
        authority governing eligibility, admissions, and occupancy of 
        families with respect to public housing dwelling units and 
        housing assistance under title III, including--
                    (A) the requirements for eligibility for such units 
                and assistance and the method by which eligibility will 
                be determined and verified;
                    (B) the requirements for selection and admissions 
                of eligible families for such units and assistance, 
                including any preferences established under section 223 
                or 321(c) and the criteria for selection under section 
                222(b);
                    (C) the procedures for assignment of families 
                admitted to dwelling units owned, operated, or assisted 
                by the authority;
                    (D) any standards and requirements for occupancy of 
                public housing dwelling units and units assisted under 
                title III, including conditions for continued 
                occupancy, termination of tenancy, and eviction;
                    (E) the criteria under subsections (d) and (f) of 
                section 321 for providing and denying housing 
                assistance under title III to families moving into the 
                jurisdiction of the authority; and
                    (F) the fair housing policy of the authority.
            (3) Rent determination.--A statement of the policies of the 
        authority governing rents charged for public housing dwelling 
        units and rental contributions of assisted families under title 
        III, including--
                    (A) the methods by which such rents are determined 
                under section 225 and such contributions are determined 
                under section 322;
                    (B) an analysis of how such methods affect--
                            (i) the ability of the authority to provide 
                        housing assistance for families having a broad 
                        range of incomes;
                            (ii) the affordability of housing for 
                        families having incomes that do not exceed 30 
                        percent of the median family income for the 
                        area; and
                            (iii) the availability of other financial 
                        resources to the authority.
            (4) Quality standards for maintenance and management.--A 
        statement of the standards and policies of the authority 
        governing maintenance and management of housing owned, 
        operated, or assisted by the authority, and management of the 
        local housing and management authority, including--
                    (A) housing quality standards in effect pursuant to 
                sections 233 and 328 and any certifications required 
                under such sections;
                    (B) routine and preventative maintenance policies;
                    (C) emergency and disaster plans;
                    (D) rent collection and security policies for 
                public housing;
                    (E) priorities and improvements for management of 
                public housing; and
                    (F) priorities and improvements for management of 
                the authority, including improvement of electronic 
                information systems to facilitate managerial capacity 
                and efficiency.
            (5) Grievance procedure.--A statement of the grievance 
        procedures of the authority under sections 232 and 330.
            (6) Capital improvements.--With respect to public housing 
        developments owned or operated by the authority, a plan 
        describing--
                    (A) the capital improvements necessary to ensure 
                long-term physical and social viability of the 
                developments; and
                    (B) the priorities of the authority for capital 
                improvements based on analysis of available financial 
                resources, consultation with residents, and health and 
                safety considerations.
            (7) Demolition and disposition.--With respect to public 
        housing developments owned or operated by the authority--
                    (A) a description of any such housing to be 
                demolished or disposed of under subtitle E of title II;
                    (B) a timetable for such demolition or disposition; 
                and
                    (C) any information required under section 261(h) 
                with respect to such demolition or disposition.
            (8) Designation of housing for elderly and disabled 
        families.--With respect to public housing developments owned or 
        operated by the authority, a description of any developments 
        (or portions thereof) that the authority has designated or will 
        designate for occupancy by elderly and disabled families in 
        accordance with section 227 and any information required under 
        section 227(d) for such designated developments.
            (9) Conversion of public housing.--With respect to public 
        housing owned or operated by the authority, a description of 
        any building or buildings that the authority is required under 
        section 203(b) to convert to housing assistance under title 
        III, an analysis of such buildings showing that the buildings 
        meet the requirements under such section for such conversion, 
        and a statement of the amount of grant amounts under title II 
        to be used for rental assistance under title III.
            (10) Homeownership activities.--A description of any 
        homeownership programs of the authority under subtitle D or 
        section 329 for the authority and the requirements and 
        assistance available under such programs.
    (d) 10-Year Plan.--Each community improvement plan under this 
section for a local housing and management authority shall contain, 
with respect to the 10-year period beginning with the fiscal year for 
which the plan is submitted, the following information:
            (1) Statement of mission.--A statement of the mission of 
        the authority for serving the needs of low-income families in 
        the jurisdiction of authority during such period.
            (2) Goals and objectives.--A statement of the goals and 
        objectives of the authority that will enable the authority to 
        serve the needs identified pursuant to paragraph (1) during 
        such period.
            (3) Capital improvement overview.--If the authority will 
        provide capital improvements for public housing developments 
        during such period, an overview of such improvements, the 
        rationale for such improvements, and an analysis of how such 
        improvements will enable the authority to meet its goals, 
        objectives, and mission.
    (e) Citizen Participation.--
            (1) In general.--Before submitting a plan under this 
        section or an amendment under section 108(f) to a plan, a local 
        housing and management authority shall make the plan or 
        amendment publicly available in a manner that affords affected 
        public housing residents and assisted families under title III, 
        citizens, public agencies, and other interested parties an 
        opportunity, for a period not shorter than 60 days and ending 
        at a time that reasonably provides for compliance with the 
        requirements of paragraph (2), to examine its content and to 
        submit comments to the authority.
            (2) Consideration of comments.--A local housing and 
        management authority shall consider any comments or views 
        provided pursuant to paragraph (1) in preparing a final plan or 
        amendment for submission to the Secretary. A summary of such 
        comments or views shall be attached to the plan, amendment, or 
        report submitted. The submitted plan, amendment, or report 
        shall be made publicly available upon submission.
    (f) Plans for Small LMHA's.--The Secretary shall establish 
requirements applicable to housing and management authorities that own 
or operate less than 250 public housing dwelling units for submission 
of plans under this section and the information to be included in such 
plans that waive any requirements under this section that the Secretary 
determines are burdensome or unnecessary for such agencies.
    (g) Regulations.--Notwithstanding sections 563(a) and 565(a) of 
title 5, United States Code, any proposed regulation relating to the 
required contents of plans under this section shall be issued pursuant 
to a negotiated rulemaking procedure under subchapter of chapter 5 of 
such title and the Secretary shall establish a negotiated rulemaking 
committee for development of any such proposed regulations.

SEC. 108. REVIEW OF PLANS.

    (a) Review.--The Secretary shall conduct a limited review of each 
community improvement plan submitted to the Secretary to ensure that 
the plan is complete and complies with the requirements of section 107. 
The Secretary shall notify each local housing and management authority 
submitting a plan whether the plan complies with such requirements not 
later than 60 days after receiving the plan. If the Secretary does not 
notify the local housing and management authority, as required under 
this subsection and subsection (b), the plan shall be considered, for 
purposes of this section, to comply with the requirements under section 
107.
    (b) Notice of Reasons for Determination of Noncompliance.--If the 
Secretary determines that a plan, as submitted, does not comply with 
the requirements under section 107, the Secretary shall specify in the 
notice under subsection (a) the reasons for the noncompliance and any 
modifications necessary for the plan to meet the requirements under 
section 107.
    (c) Standards for Determination of Noncompliance.--The Secretary 
may determine that a plan does not comply with the requirements under 
section 107 only if--
            (1) the plan is incomplete in significant matters required 
        under such section; or
            (2) there is evidence available to the Secretary that 
        challenges, in a substantial manner, any information provided 
        in the plan.
    (d) Treatment of Existing Plans.--Notwithstanding any other 
provision of this title, a local housing and management authority shall 
be considered have submitted a plan under this section if the authority 
has submitted to the Secretary a comprehensive plan under section 14(e) 
of the United States Housing Act of 1937 (as in effect immediately 
before the enactment of this Act) or under the comprehensive 
improvement assistance program under such section 14, and the Secretary 
has approved such plan, before January 1, 1994. The Secretary shall 
provide specific procedures and requirements for such authorities to 
amend such plans by submitting only such additional information as is 
necessary to comply with the requirements of section 107.
    (e) Actions to Change Plan.--A local housing and management 
authority that has submitted a plan under section 107 may change 
actions or policies described in the plan before submission and review 
of the plan of the authority for the next fiscal year only if--
            (1) in the case of costly or nonroutine changes, the 
        authority submits to the Secretary an amendment to the plan 
        under subsection (f) which is reviewed in accordance with such 
        subsection; or
            (2) in the case of inexpensive or routine changes, the 
        authority describes such changes in such community improvement 
        plan for the next fiscal year.
    (f) Amendments to Plan.--
            (1) In general.--During the annual or 10-year period 
        covered by the plan for a local housing and management 
        authority, the authority may submit to the Secretary any 
        amendments to the plan.
            (2) Review.--The Secretary shall conduct a limited review 
        of each proposed amendment submitted under this subsection to 
        determine whether the plan, as amended by the amendment, 
        complies with the requirements of section 107 and notify each 
        local housing and management authority submitting the amendment 
        whether the plan, as amended, complies with such requirements 
        not later than 30 days after receiving the amendment. If the 
        Secretary determines that a plan, as amended, does not comply 
        with the requirements under section 107, such notice shall 
        indicate the reasons for the noncompliance and any 
        modifications necessary for the plan to meet the requirements 
        under section 107. If the Secretary does not notify the local 
        housing and management authority as required under this 
        paragraph, the plan, as amended, shall be considered, for 
        purposes of this section, to comply with the requirements under 
        section 107.
            (3) Standards for determination of noncompliance.--The 
        Secretary may determine that a plan, as amended by a proposed 
        amendment, does not comply with the requirements under section 
        107 only if--
                    (A) the plan, as amended, would be subject to a 
                determination of noncompliance in accordance with the 
                provisions of subsection (c); or
                    (B) the Secretary determines that--
                            (i) the proposed amendment is plainly 
                        inconsistent with the activities specified in 
                        the plan; or
                            (ii) there is evidence that challenges, in 
                        a substantial manner, any information contained 
                        amendment.
            (4) Amendments to extend time of performance.--
        Notwithstanding any other provision of this subsection, the 
        Secretary may not determine that any amendment to the plan of a 
        local housing and management authority that extends the time 
        for performance of activities assisted with amounts provided 
        under this title fails to comply with the requirements under 
        section 107 if the Secretary has not provided the amount of 
        assistance set forth in the plan or has not provided the 
        assistance in a timely manner.

SEC. 109. HEADQUARTERS RESERVE FUND.

    (a) Annual Reservation of Amounts.--Notwithstanding any other 
provision of law, the Secretary may retain not more than 3 percent of 
the amounts appropriated to carry out this Act for any fiscal year.
    (b) Use of Amounts.--Any amounts that are retained under subsection 
(a) shall be available for subsequent allocation to specific areas and 
communities, and may only be used for--
            (1) unforeseen housing needs resulting from natural and 
        other disasters;
            (2) housing needs resulting from emergencies, as certified 
        by the Secretary, other than such disasters;
            (3) housing needs related to a court order or settlement of 
        litigation; and
            (4) providing technical assistance, training, and 
        electronic information systems for local housing and management 
        authorities to improve management of such authorities.

SEC. 110. LABOR STANDARDS.

    (a) In General.--Any contract for grants, sale, or lease pursuant 
to this Act shall contain the following provisions:
            (1) Operation.--A provision requiring that not less than 
        the wages prevailing in the locality, as determined or adopted 
        (subsequent to a determination under applicable State or local 
        law) by the Secretary, shall be paid to all architects, 
        technical engineers, draftsmen, and technicians employed in the 
        development, and all maintenance laborers and mechanics 
        employed in the operation, of the low-income housing 
        development involved.
            (2) Production.--A provision that not less than the wages 
        prevailing in the locality, as predetermined by the Secretary 
        of Labor pursuant to the Davis-Bacon Act (40 U.S.C. 276a-276a-
        5), shall be paid to all laborers and mechanics employed in the 
        development of the project involved.
The Secretary shall require certification as to compliance with the 
provisions of this section before making any payment under such 
contract.
    (b) Exceptions.--Subsection (a) and the provisions relating to 
wages (pursuant to subsection (a)) in any contract for grants, sale, or 
lease pursuant to this Act, shall not apply to any of the following 
individuals:
            (1) Volunteers.--Any individual who--
                    (A) performs services for which the individual 
                volunteered;
                    (B)(i) does not receive compensation for such 
                services; or
                    (ii) is paid expenses, reasonable benefits, or a 
                nominal fee for such services; and
                    (C) is not otherwise employed at any time in the 
                construction work.
            (2) Residents employed by lhma.--Any resident of a public 
        housing development who is an employee of the local housing and 
        management authority for the development and performs services 
        in connection with the operation or production of a low-income 
        housing project owned or managed by such authority.

SEC. 111. NONDISCRIMINATION.

    (a) In General.--No person in the United States shall on the 
grounds of race, color, national origin, religion, or sex be excluded 
from participation in, be denied the benefits of, or be subjected to 
discrimination under any program or activity funded in whole or in part 
with amounts made available under this Act. Any prohibition against 
discrimination on the basis of age under the Age Discrimination Act of 
1975 or with respect to an otherwise qualified handicapped individual 
as provided in section 504 of the Rehabilitation Act of 1973 shall also 
apply to any such program or activity.
    (b) Civil Rights Compliance.--Each local housing and management 
authority that receives grant amounts under this Act shall use such 
amounts and carry out its community improvement plan approved under 
section 108 in conformity with title VI of the Civil Rights Act of 
1964, the Fair Housing Act, section 504 of the Rehabilitation Act of 
1973, and the Age Discrimination Act of 1975, and shall affirmatively 
further fair housing.

SEC. 112. EFFECTIVE DATE AND REGULATIONS.

    (a) Effective Date.--The provisions of this Act and the amendments 
made by this Act shall take effect and shall apply on the date of the 
enactment of this Act, unless such provisions or amendments 
specifically provide for effectiveness or applicability on another date 
certain.
    (b) Regulations.--The Secretary may issue any regulations necessary 
to carry out this Act.
    (c) Rule of Construction.--Any failure by the Secretary to issue 
any regulations authorized under subsection (b) shall not affect the 
effectiveness of any provision of Act or any amendment made by this 
Act.

                        TITLE II--PUBLIC HOUSING

                        Subtitle A--Block Grants

SEC. 201. BLOCK GRANT CONTRACTS.

    (a) In General.--The Secretary shall enter into contracts with 
local housing and management authorities under which--
            (1) the Secretary agrees to make a block grant under this 
        title, in the amount provided under section 202(c), for 
        assistance for low-income housing to the local housing and 
        management authority for each fiscal year covered by the 
        contract; and
            (2) the authority agrees--
                    (A) to provide safe, clean, and healthy housing 
                that is affordable to low-income families and services 
                for families in such housing;
                    (B) to operate, or provide for the operation, of 
                such housing in a financially sound manner;
                    (C) to use the block grant amounts in accordance 
                with this title and the community improvement plan for 
                the authority that complies with the requirements of 
                section 107;
                    (D) to involve residents of housing assisted with 
                block grant amounts in functions and decisions relating 
                to management and the quality of life in such housing;
                    (E) that the management of the public housing of 
                the authority shall be subject to actions authorized 
                under subtitle B of title IV;
                    (F) that the Secretary may take actions under 
                section 205 with respect to improper use of grant 
                amounts provided under the contract; and
                    (G) to otherwise comply with the requirements under 
                this title.
    (b) Modification.--Contracts and agreements between the Secretary 
and a local housing and management authority may not be amended in a 
manner which would--
            (1) impair the rights of--
                    (A) leaseholders for units assisted pursuant to a 
                contract or agreement; or
                    (B) the holders of any outstanding obligations of 
                the local housing and management authority involved for 
                which annual contributions have been pledged; or
            (2) provide for payment of block grant amounts under this 
        title in an amount exceeding the allocation for the authority 
        determined under section 204.
Any rule of law contrary to this subsection shall be deemed 
inapplicable.
    (c) Conditions on Renewal.--Each block grant contract under this 
section shall provide, as a condition of renewal of the contract with 
the local housing and management authority, that the authority's 
accreditation be renewed by the Housing Foundation and Accreditation 
Board pursuant to review under section 434 by such Board.

SEC. 202. BLOCK GRANT AUTHORITY AND AMOUNT.

    (a) Authority.--The Secretary shall make block grants under this 
title to eligible local housing and management authorities in 
accordance with block grant contracts under section 201.
    (b) Eligibility.--A local housing and management authority shall be 
an eligible local housing and management authority with respect to a 
fiscal year for purposes of this title only if--
            (1) the Secretary has entered into a block grant contract 
        with the authority;
            (2) the authority has submitted a community improvement 
        plan to the Secretary for such fiscal year;
            (3) the Secretary has reviewed the community improvement 
        plan under section 108 and has not notified the authority that 
        the plan fails to comply with the requirements under section 
        107;
            (4) the authority is accredited under section 434 by the 
        Housing Foundation and Accreditation Board;
            (5) the authority is exempt from local taxes, as provided 
        under subsection (d), or receives a contribution, as provided 
        under such subsection;
            (6) no member of the board of directors or other governing 
        body of the authority, or the executive director, has been 
        convicted of a felony;
            (7) the authority has entered into an agreement providing 
        for local cooperation in accordance with section (e); and
            (8) the authority has not been disqualified for a grant 
        pursuant to section 205(a) or subtitle B of title IV.
    (c) Amount of Grants.--The amount of the grant under this title for 
a local housing and management authority for a fiscal year shall be the 
amount of the allocation for the authority determined under section 
204, except as otherwise provided in this title and subtitle B of title 
IV.
    (d) Payments in Lieu of State and Local Taxation of Public Housing 
Developments.--
            (1) Exemption from taxation.--A local housing and 
        management authority may receive a block grant under this title 
        only if--
                    (A)(i) the developments of the authority (exclusive 
                of any portions not assisted with amounts provided 
                under this title) are exempt from all real and personal 
                property taxes levied or imposed by the State, city, 
                county, or other political subdivision; and
                    (ii) the local housing and management authority 
                makes payments in lieu of taxes to such taxing 
                authority equal to 10 percent of the sum, for units 
                charged in the developments of the authority, of the 
                difference between the gross rent and the utility cost, 
                or such lesser amount as is--
                            (I) prescribed by State law;
                            (II) agreed to by the local governing body 
                        in its agreement under subsection (e) for local 
                        cooperation with the local housing and 
                        management authority or under a waiver by the 
                        local governing body; or
                            (III) due to failure of a local public body 
                        or bodies other than the local housing and 
                        management authority to perform any obligation 
                        under such agreement; or
                    (B) the authority complies with the requirements 
                under subparagraph (A) with respect to public housing 
                developments, but the authority agrees that the low-
                income units in any mixed-income developments (as such 
                term is defined in section 221(c)(2)) shall be subject 
                to any otherwise applicable real property taxes imposed 
                by the State, city, county or other political 
                subdivision.
            (2) Effect of failure to exempt from taxation.--
        Notwithstanding paragraph (1), a local housing and management 
        authority that does not comply with the requirements under such 
        paragraph may receive a block grant under this title, but only 
        if the State, city, county, or other political subdivision in 
        which the development is situated contributes, in the form of 
        cash or tax remission, the amount by which the taxes paid with 
        respect to the development exceed 10 percent of the gross rent 
        and utility cost charged in the development.
    (e) Local Cooperation.--In recognition that there should be local 
determination of the need for low-income housing to meet needs not 
being adequately met by private enterprise, the Secretary may not make 
any grant under this title to a local housing and management authority 
unless the governing body of the locality involved has entered into an 
agreement with the authority providing for the local cooperation 
required by the Secretary pursuant to this title.
    (f) Exception.--Notwithstanding subsection (a), the Secretary may 
make a grant under this title for a local housing and management 
authority that is not an eligible local housing and management 
authority but only for the period necessary to secure, in accordance 
with this title, an alternative local housing and management authority 
for the public housing of the ineligible authority.

SEC. 203. ELIGIBLE AND REQUIRED ACTIVITIES.

    (a) Eligible Activities.--Except as provided in subsection (b), 
amounts from a grant made under this title may be used only for the 
following activities and costs:
            (1) Production.--Production of public housing developments 
        and any production costs.
            (2) Operation.--Operation of public housing developments in 
        a manner appropriate to ensure the viability of the 
        developments as low-income housing, which shall include 
        providing adequate operating services and reserve funds.
            (3) Modernization.--Improvement of the physical condition 
        of existing public housing developments (including routine and 
        timely improvements, rehabilitation, and replacement of 
        systems, and major rehabilitation, redesign, reconstruction, 
        and redevelopment) and upgrading the management and operation 
        of such developments, to ensure that such developments continue 
        to be available for use as low-income housing.
            (4) Resident programs.--Provision of social, educational, 
        employment, self-sufficiency, and other services to the 
        residents of public housing developments, including providing 
        the non-Federal share required in connection with activities 
        undertaken under Federal grant-in-aid programs.
            (5) Homeownership activities.--Activities in connection 
        with a homeownership program for public housing residents under 
        subtitle D, including providing financing or assistance for 
        purchasing housing, or the provision of financial assistance to 
        resident management corporations or resident councils to obtain 
        training, technical assistance, and educational assistance to 
        promote homeownership opportunities.
            (6) Resident management activities.--Activities in 
        connection with establishing, organizing, training, and 
        assisting resident councils and resident management 
        corporations for public housing developments.
            (7) Demolition and disposition activities.--Activities in 
        connection with the disposition or demolition of public housing 
        under section 261.
            (8) Payments in lieu of taxes.--Payments in accordance with 
        the requirement under section 202(d)(1).
            (9) Emergency corrections.--Correction of conditions that 
        constitute an immediate threat to the health or safety of 
        residents of public housing developments, without regard to 
        whether the need for such correction is indicated in the 
        community improvement plan of the authority.
            (10) Preparation of community improvement plans.--
        Preparation of community improvement plans (including 
        reasonable costs that may be necessary to assist residents in 
        participating in the planning process in a meaningful way) and 
        conducting annual financial and performance audits under 
        section 432.
            (11) LHMA liability insurance.--Purchase of insurance 
        covering the potential personal injury liability exposure of 
        local housing and management authorities (and their 
        contractors), except that--
                    (A) any such insurance so purchased shall be 
                competitively selected;
                    (B) any coverage provided under such policies, as 
                certified by the authority, shall provide reasonable 
                coverage for the risk of liability exposure, taking 
                into consideration the potential liability concerns 
                inherent in the testing and abatement of lead-based 
                paint, and the managerial and quality assurance 
                responsibilities associated with the conduct of such 
                activities; and
                    (C) notwithstanding any other provision of State or 
                Federal law, regulation or other requirement, any line 
                of insurance from a nonprofit insurance entity, owned 
                and controlled by local housing and management 
                authorities and approved by the Secretary, may be 
                purchased without regard to competitive procurement.
            (12) Payment of outstanding development bonds and notes 
        issued under 1937 act.--Payment of principal and interest 
        payable on obligations issued pursuant to the section 5 of the 
        United States Housing Act of 1937 (as in effect before the date 
        of the enactment of this Act) by a local housing and management 
        authority to finance the production of public housing.
            (13) Mutual help homeownership opportunity programs for 
        indian housing authorities.--In the case of an Indian housing 
        authority, production, operation, and modernization of 
        developments under a mutual help homeownership program subject 
        to the requirements under section 202 of the United States 
        Housing Act of 1937 (as in effect immediately before the 
        enactment of this Act), except that any reference in such 
        section to assistance under such section or such Act shall be 
        construed to refer to assistance under this title and 
        subsection (b) of such section shall not apply.
    (b) Required Conversion of Assistance for Public Housing to Rental 
Housing Assistance.--
            (1) Requirement.--A local housing and management authority 
        that receives grant amounts under this title shall use such 
        amounts, to the extent necessary and described in the community 
improvement plan for the authority, to provide rental housing 
assistance under title III in lieu of assisting the operation and 
modernization of any building or buildings of public housing that meet 
the requirements under paragraph (2).
            (2) Public housing subject to conversion.--Assistance for a 
        building of public housing shall be converted pursuant to 
        paragraph (1) only if--
                    (A) the building is distressed or substantially 
                vacant;
                    (B) the estimated cost of continued operation and 
                modernization of the building exceeds the cost of 
                providing choice-based rental assistance under title 
                III; and
                    (C) there is a sufficient supply of available and 
                affordable housing to make the use of such voucher 
                assistance feasible, in the determination of the local 
                housing and management authority.
            (3) Transfer of amounts.--A local housing and management 
        authority converting assistance under this subsection shall use 
        assistance received under this title, in the amount provided in 
        the community improvement plan for the authority, in accordance 
        with the provisions applicable to amounts received under title 
        III.
    (c) Fungibility of Amounts.--Any amounts provided under a block 
grant under this title may be used for any eligible activity under 
subsection (a) or for conversion under subsection (b), notwithstanding 
whether such amounts are attributable to the operating allocation under 
section 204(d)(1) or the capital improvements allocation for the local 
housing and management authority determined under section 204(d)(2).
    (d) Compliance With Plan.--The community improvement plan submitted 
by a local housing and management authority (including any amendments 
to the plan), unless determined under section 108 not to comply with 
the requirements under section 107, shall be binding upon the Secretary 
and the local housing and management authority and the authority shall 
use any grant amounts provided under this title for eligible activities 
under subsection (a) in accordance with the plan. This subsection may 
not be construed to preclude changes or amendments to the plan, as 
authorized under section 108(e) or any actions authorized by this Act 
to be taken without regard to a community improvement plan.

SEC. 204. DETERMINATION OF BLOCK GRANT ALLOCATION.

    (a) In General.--For each fiscal year, after reserving amounts 
under section 109 from the aggregate amount made available for the 
fiscal year for carrying out this title, the Secretary shall allocate 
any remaining amounts among eligible local housing and management 
authorities in accordance with this section, so that the sum of all of 
the allocations for all eligible authorities is equal to such remaining 
amount.
    (b) Allocation Amount.--The Secretary shall determine the amount of 
the allocation for each eligible local housing and management 
authority, which shall be--
            (1) for any fiscal year beginning after the enactment of a 
        law containing a formula described in subsection (c), the 
        amount determined under such formula; or
            (2) for any fiscal year beginning before the expiration of 
        such period, the sum of--
                    (A) the operating allocation determined under 
                subsection (d)(1) for the authority; and
                    (B) the capital improvement allocation determined 
                under subsection (d)(2) for the authority.
    (c) Permanent Allocation Formula.--
            (1) Formula.--A formula under this subsection shall provide 
        for allocating amounts available for a fiscal year for block 
        grants under this title for each local housing and management 
        authority. The formula shall consider factors that reflect the 
        different characteristics and sizes of local housing and 
        management authorities, the relative needs, costs, and capital 
        improvements of authorities, and the relative costs to 
        authorities of operating a well-managed authority that meets 
        the performance targets for the authority established in the 
        community improvement plan for the authority.
            (2) Development under negotiated rulemaking procedure.--The 
        formula under this subsection shall be developed according to 
        procedures for issuance of regulations under the negotiated 
        rulemaking procedure under subchapter III of chapter 5 of title 
        5, United States Code, except that the formula shall not be 
        contained in a regulation.
            (3) Report.--Not later than the expiration of the 18-month 
        period beginning upon the enactment of this Act, the Secretary 
        shall submit a report to the Congress containing the proposed 
        formula established pursuant to paragraph (2) that meets the 
        requirements of this subsection.
    (d) Interim Allocation Requirements.--
            (1) Operating allocation.--
                    (A) Applicability to 50 percent of appropriated 
                amounts.--Of any amounts available for allocation under 
                this subsection for a fiscal year, 50 percent shall be 
                used only to provide amounts for operating allocations 
                under this paragraph for eligible local housing and 
                management authorities.
                    (B) Determination.--The operating allocation under 
                this subsection for a local housing and management 
                authority for a fiscal year shall be an amount 
                determined by applying, to the amount to be allocated 
                under this paragraph, the formula used for determining 
                the distribution of operating subsidies for fiscal year 
                1995 to public housing agencies (as modified under 
                subparagraph (C)) under section 9 of this Act, as in 
                effect before the enactment of this Act.
                    (C) Treatment of chronically vacant units.--The 
                Secretary shall revise the formula referred to in 
                subparagraph (B) so that the formula does not provide 
                any amounts attributable to any dwelling unit of a 
                local housing and management authority that has been 
                vacant continuously for 6 or more months. A unit shall 
                not be considered vacant for purposes of this paragraph 
                if the unit is unoccupied because of rehabilitation or 
                renovation that is on-schedule.
            (2) Capital improvement allocation.--
                    (A) Applicability to 50 percent of appropriated 
                amounts.--Of any amounts available for allocation under 
                this subsection for a fiscal year, 50 percent shall be 
                used only to provide amounts for capital improvement 
                allocations under this paragraph for eligible local 
                housing and management authorities.
                    (B) Determination.--The capital improvement 
                allocation under this subsection for an eligible local 
                housing and management authority for a fiscal year 
                shall be determined by applying, to the amount to be 
                allocated under this paragraph, the formula used for 
                determining the distribution of modernization 
                assistance for fiscal year 1995 to public housing 
                agencies under section 14 of this Act, as in effect 
                before the enactment of this Act, except that Secretary 
                shall establish a method for taking into consideration 
                allocation of amounts under the comprehensive 
                improvement assistance program.

SEC. 205. SANCTIONS FOR IMPROPER USE OF AMOUNTS.

    (a) In General.--In addition to any other actions authorized under 
this title, if the Secretary finds pursuant to an annual financial and 
performance audit under section 432 that a local housing and management 
authority receiving grant amounts under this title has failed to comply 
substantially with any provision of this title, the Secretary may--
            (1) terminate payments under this title to the authority;
            (2) withhold from the authority amounts from the total 
        allocation for the authority pursuant to section 204;
            (3) reduce the amount of future grant payments under this 
        title to the authority by an amount equal to the amount of such 
        payments that were not expended in accordance with this title;
            (4) limit the availability of grant amounts provided to the 
        authority under this title to programs, projects, or activities 
        not affected by such failure to comply;
            (5) withhold from the authority amounts allocated for the 
        authority under title III; or
            (6) order other corrective action with respect to the 
        authority.
    (b) Termination of Compliance Action.--If the Secretary takes 
action under subsection (a) with respect to a local housing and 
management authority, the Secretary shall--
            (1) in the case of action under subsection (a)(1), resume 
        payments of grant amounts under this title to the authority in 
        the full amount of the total allocation under section 204 for 
        the authority at time that the Secretary first determines that 
        the authority will comply with the provisions of this title;
            (2) in the case of action under paragraph (2), (5), or (6) 
        of subsection (a), make withheld amounts available as the 
        Secretary considers appropriate to ensure that the authority 
        complies with the provisions of this title; or
            (3) in the case of action under subsection (a)(4), release 
        such restrictions at the time that the Secretary first 
        determines that the authority will comply with the provisions 
        of this title.

           Subtitle B--Admissions and Occupancy Requirements

SEC. 221. LOW-INCOME HOUSING REQUIREMENT.

    (a) Production Assistance.--Any public housing produced using 
amounts provided under a grant under this title or under the United 
States Housing Act of 1937 shall be operated as public housing for the 
40-year period beginning upon such production.
    (b) Operating Assistance.--No portion of any public housing 
development operated with amounts from a grant under this title or 
operating assistance provided under the United States Housing Act of 
1937 may be disposed of before the expiration of the 10-year period 
beginning upon the conclusion of the fiscal year for which the grant or 
such assistance was provided.
    (c) Capital Improvements Assistance.--Amounts may be used for 
eligible activities under section 203(a)(3) only for the following 
housing developments:
            (1) Low-income developments.--Amounts may be used for a 
        low-income housing development that--
                    (A) is owned by local housing and management 
                authorities;
                    (B) is operated as low-income rental housing and 
                produced or operated with assistance provided under a 
                grant under this title; and
                    (C) is consistent with the purposes of this title.
        Any development, or portion thereof, referred to in this 
        paragraph for which activities under section 203(a)(3) are 
        conducted using amounts from a grant under this title shall be 
maintained and used as public housing for the 20-year period beginning 
upon the receipt of such grant. Any public housing development, or 
portion thereof, that received the benefit of a grant pursuant to 
section 14 of the United States Housing Act of 1937 shall be maintained 
and used as public housing for the 20-year period beginning upon 
receipt of such amounts.
            (2) Mixed income developments.--Amounts may be used for 
        mixed-income developments, which shall be a housing development 
        that--
                    (A) contains dwelling units that are available for 
                occupancy by families other than low-income families;
                    (B) contains a number of dwelling units that are 
                made available (by master contract or individual lease) 
                for occupancy, for a period of not less than 15 years, 
                only by very low-income families identified by the 
                local housing and management authority, which number is 
                not less than--
                            (i) the number that bears the same ratio to 
                        the total number of units in the development as 
                        the value of the financial assistance provided 
                        to the development with grant amounts under 
                        this title bears to the value of the total 
                        equity investment in the development, as 
                        determined by the local housing and management 
                        authority; or
                            (ii) the number of public housing dwelling 
                        units that could have been developed by the 
                        authority with the amount of such assistance 
                        provided; and
                    (C) is owned by--
                            (i) the local housing and management 
                        authority or an affiliate controlled by it;
                            (ii) a partnership, limited liability 
                        company, or other legal entity in which the 
                        local housing and management authority (or an 
                        entity controlled by such authority) is a 
                        general or limited partner or a general or 
                        limited managing member, or otherwise has a 
                        significant participation in directing the 
                        activities of such entity; or
                            (iii) an entity that grants to the local 
                        housing and management authority an option to 
                        purchase the housing development, for a price 
                        specified in section 42 of the Internal Revenue 
                        Code of 1986, which may be exercised during the 
                        15-year period beginning upon initial 
                        occupancy.

SEC. 222. FAMILY INCOME ELIGIBILITY.

    (a) In General.--Dwelling units in public housing may be rented 
only to families who are low-income families at the time of their 
initial occupancy of such units.
    (b) Income Mix Within Developments.--A local housing and management 
authority may establish and utilize income-mix criteria for the 
selection of residents for dwelling units in public housing 
developments that limit admission to a development by selecting 
applicants having incomes appropriate so that the mix of incomes of 
families occupying the development is proportional to the income mix in 
the eligible population of the jurisdiction of the authority, as 
adjusted to take into consideration the severity of housing need.
    (c) Waiver of Eligibility Requirements for Occupancy by Police 
Officers.--To provide occupancy in public housing dwelling units to 
police officers and other law enforcement or security personnel (who 
are not otherwise eligible for residence in public housing) to increase 
security for other public housing residents in developments where crime 
has been a problem, a local housing and management authority may, with 
respect to such units--
            (1) waive--
                    (A) the provisions of subsection (a) of this 
                section and section 225(a);
                    (B) the applicability of--
                            (i) any preferences for occupancy 
                        established under section 223;
                            (ii) the maximum and minimum rental amounts 
                        established pursuant to section 225(b);
                            (iii) any criteria relating to project 
                        income mix established under subsection (b); 
                        and
                            (iv) any other occupancy limitations or 
                        requirements; and
            (2) establish special rent requirements and other terms and 
        conditions of occupancy.

SEC. 223. PREFERENCES FOR OCCUPANCY.

    (a) Authority to Establish.--Any local housing and management 
authority may establish a system for making dwelling units in public 
housing available for occupancy that provides preference for such 
occupancy to families having certain characteristics.
    (b) Content.--Each system of preferences established pursuant to 
this section shall be based upon local housing needs and priorities, as 
determined by the local housing and management authority.

SEC. 224. ADMISSION PROCEDURES.

    (a) Admission Requirements.--A local housing and management 
authority shall ensure that each family residing in a public housing 
development owned or administered by the authority is admitted in 
accordance with the procedures established under this title by the 
authority and the income limits under section 222.
    (b) Availability of Criminal Records.--Notwithstanding any other 
provision of Federal, State, or local law, upon the request of any 
local housing and management authority, the National Crime Information 
Center, police departments, and any other law enforcement entities 
shall provide information to the authority regarding the criminal 
convictions of applicants for, or residents of, public housing for the 
purpose of applicant screening, lease enforcement, and eviction. A 
local housing and management authority may pay a reasonable fee for 
such information.
    (c) Notification of Application Decisions.--A local housing and 
management authority shall establish procedures designed to provide for 
notification to an applicant for admission to public housing of the 
determination with respect to such application, the basis for the 
determination, and, if the applicant is determined to be eligible for 
admission, the projected date of occupancy (to the extent such date can 
reasonably be determined).

SEC. 225. FAMILY RENTAL PAYMENT.

    (a) Rental Contribution by Resident.--A family shall pay as monthly 
rent for a dwelling unit in public housing the amount that the local 
housing and management authority determines is appropriate with respect 
to the family and the unit, which shall be--
            (1) based upon factors determined by the authority, which 
        may include the adjusted income of the resident, type and size 
        of dwelling unit, operating and other expenses of the 
        authority, or any other factors that the authority considers 
        appropriate; and
            (2) an amount that is not less than the minimum monthly 
        rental amount nor more than the maximum monthly rental amount 
        established for the dwelling unit pursuant to subsection (b).
In determining the amount of the rent charged for a dwelling unit, a 
local housing and management authority shall take into consideration 
the characteristics of the population served by the authority, the 
goals of the community improvement plan for the authority, and the 
goals under the comprehensive housing affordability strategy under 
section 105 of the Cranston-Gonzalez National Affordable Housing Act 
for the applicable jurisdiction.
    (b) Allowable Rents.--Each local housing and management authority 
shall establish, for each dwelling unit in public housing owned or 
administered by the authority, a maximum and minimum monthly rental 
amount, as follows:
            (1) Maximum rental.--The maximum monthly rental amount for 
        a unit shall be an amount determined by the authority which is 
        based on, but does not exceed--
                    (A) the average, for dwelling units of similar size 
                in public housing developments owned and operated by 
                such authority, of operating expenses attributable to 
                and reasonable reserves for such units;
                    (B) the reasonable rental value of the unit; or
                    (C) the local market rent for comparable units of 
                similar size.
            (2) Minimum rental.--The minimum monthly rental amount for 
        a unit may not be less than $50.
    (c) Income Reviews.--If a local housing and management authority 
establishes the amount of rent paid by a family for a public housing 
dwelling unit based on the adjusted income of the family, the authority 
shall review the incomes of such family occupying dwelling units in 
public housing owned or administered by the authority not less than--
            (1) once every 3 years, in the cases of elderly families 
        and disabled families; and
            (2) annually, in the case of nonelderly families.

SEC. 226. LEASE REQUIREMENTS.

    In renting dwelling units in a public housing development, each 
local housing and management authority shall utilize leases that--
            (1) do not contain unreasonable terms and conditions;
            (2) obligate the local housing and management authority to 
        maintain the development in compliance with the housing quality 
        requirements under section 233;
            (3) require the local housing and management authority to 
        give adequate written notice of termination of the lease, which 
        shall not be less than--
                    (A) the period provided under the applicable law of 
                the jurisdiction or 14 days, whichever is less, when 
                the health or safety of other residents or local 
                housing and management authority employees is 
                threatened or in the case of nonpayment of rent; and
                    (B) the period of time provided under the 
                applicable law of the jurisdiction, in any other case;
            (4) require that the local housing and management authority 
        may not terminate the tenancy except for violation of the terms 
        or conditions of the lease, violation of applicable Federal, 
        State, or local law, or for other good cause;
            (5) provide that any activity, engaged in by a public 
        housing resident, any member of the resident's household, or 
        any guest or other person under the resident's control, that--
                    (A) threatens the health or safety of, or right to 
                peaceful enjoyment of the premises by, other residents 
                or employees of the local housing and management 
                authority or other manager of the housing,
                    (B) threatens the health or safety of, or right to 
                peaceful enjoyment of their premises by, persons 
                residing in the immediate vicinity of the premises, or
                    (C) is criminal activity (including drug-related 
                criminal activity),
        shall, regardless of whether the resident had actual knowledge 
        of such activity, be cause for termination of tenancy; and
            (6) specify that, with respect to any notice of eviction or 
        termination, notwithstanding any State law, a public housing 
        resident shall be informed of the opportunity, prior to any 
        hearing or trial, to examine any relevant documents, records or 
        regulations directly related to the eviction or termination.

SEC. 227. DESIGNATED HOUSING FOR ELDERLY AND DISABLED FAMILIES.

    (a) Authority To Provide Designated Housing.--
            (1) In general.--Subject only to provisions of this 
        subsection, a local housing and management authority provide 
        public housing developments (or portions of developments) 
        designated for occupancy by (A) only elderly families, (B) only 
        disabled families, or (C) elderly and disabled families.
            (2) Priority for occupancy.--In determining priority for 
        admission to public housing developments (or portions of 
        developments) that are designated for occupancy as provided in 
        paragraph (1), the local housing and management authority may 
        make units in such developments (or portions) available only to 
        the types of families for whom the development is designated.
            (3) Eligibility of near-elderly families.--If a local 
        housing and management authority determines that there are 
        insufficient numbers of elderly families to fill all the units 
        in a development (or portion of a development) designated under 
        paragraph (1) for occupancy by only elderly families, the 
        authority may provide that near-elderly families may occupy 
        dwelling units in the development (or portion).
    (b) Prohibition of Evictions.--Any resident who is lawfully 
residing in a dwelling unit in the development may not be evicted or 
otherwise required to vacate such unit because of the designation of 
the development (or portion of a development) or because of any action 
taken by the Secretary or any local housing and management authority to 
carry out this section.
    (c) Relocation Assistance.--A local housing and management 
authority that designates any existing development or building, or 
portion thereof, for occupancy as provided under subsection (a) shall 
provide, to each person and family relocated in connection with such 
designation--
            (1) notice of the designation and relocation, as soon as is 
        practicable for the authority and the person or family;
            (2) comparable housing (including appropriate services and 
        design features), which may include rental assistance under 
        title III, at a rental rate that is comparable to that 
        applicable to the unit from which the person or family has 
        vacated; and
            (3) payment of actual, reasonable moving expenses.
    (d) Required Inclusions in Community Improvement Plan.--
            (1) In general.--A local housing and management authority 
        may designate a development (or portion of a development) for 
        occupancy under subsection (a)(1) only if the authority, as 
        part of the authority's community improvement plan--
                    (A) establishes that the designation of the 
                development is necessary--
                            (i) to achieve the housing goals for the 
                        jurisdiction under the comprehensive housing 
                        affordability strategy under section 105 of the 
                        Cranston-Gonzalez National Affordable Housing 
                        Act; and
                            (ii) to meet the housing needs of the low-
                        income population jurisdiction; and
                    (B) submits a description of--
                            (i) the development (or portion of a 
                        development) to be designated;
                            (ii) the types of residents for which the 
                        development is to be designated;
                            (iii) any supportive services to be 
                        provided to residents of the designated 
                        development (or portion);
                            (iv) how the authority will secure any 
                        additional resources or housing assistance that 
                        is necessary to provide assistance to 
                        nonelderly disabled families that would have 
                        been housed if occupancy in development were 
                        not restricted pursuant to this section; and
                            (v) how the design and related facilities 
                        (as such term is defined in section 202(d)(8) 
                        of the Housing Act of 1959) of the development 
                        accommodate the special environmental needs of 
                        the intended occupants.
            (2) Effectiveness.--The information required under 
        paragraph (1) shall be effective for purposes of designation of 
        a public housing development (or portion thereof) under this 
        section only for the 2-year period that begins upon submission 
        of the information to the Secretary. A local housing and 
        management authority may extend the effectiveness of the 
        designation and information for an additional 2-year period 
        beginning upon the expiration of such period (or the expiration 
        of any previous extension period under this sentence) by 
        updating such information in the community improvement plan for 
        the authority.
            (3) Supportive services.--For purposes of this subsection, 
        the term ``supportive services'' means services designed to 
        meet the special needs of residents.
    (e) Inapplicability of Uniform Relocation Assistance and Real 
Property Acquisitions Policy Act of 1970.--No resident of a public 
housing development shall be considered to be displaced for purposes of 
the Uniform Relocation Assistance and Real Property Acquisitions Policy 
Act of 1970 because of the designation of any existing development or 
building, or portion thereof, for occupancy as provided under 
subsection (a) of this section.
    (f) Inapplicability to Indian Housing.--The provisions of this 
section shall not apply with respect to low-income housing developed or 
operated pursuant to a contract between the Secretary and an Indian 
housing authority.

                         Subtitle C--Management

SEC. 231. MANAGEMENT PROCEDURES.

    (a) Sound Management.--A local housing and management authority 
that receives grant amounts under this title shall establish and comply 
with procedures and practices sufficient to ensure that the public 
housing developments owned or administered by the authority are 
operated in a sound manner.
    (b) Management by Other Entities.--Except as otherwise provided 
under this Act, a local housing and management authority may contract 
with any other entity to perform any of the management functions for 
public housing owned or operated by the local housing and management 
authority.

SEC. 232. ADMINISTRATIVE GRIEVANCE PROCEDURE.

    (a) In General.--Each local housing and management authority 
receiving assistance under this title shall establish and implement an 
administrative grievance procedure under which public housing residents 
will have an opportunity for disposition of resident grievances 
concerning adverse actions of the local housing and management 
authority.
    (b) Exclusion of Grievances Concerning Evictions from 
Administrative Procedure.--A local housing and management authority 
shall exclude from its procedure established under subsection (a) any 
grievance concerning an eviction or termination of tenancy in any State 
which requires that, prior to eviction, a resident be provided a 
hearing in court which the Secretary determines provides the basic 
elements of due process.

SEC. 233. HOUSING QUALITY REQUIREMENTS.

    (a) In General.--Each local housing and management authority that 
receives grant amounts under this Act shall maintain its public housing 
in a condition that complies--
            (1) in the case of public housing located in a jurisdiction 
        which has in effect laws, regulations, standards, or codes 
        regarding habitability of residential dwellings that provide 
        protection to residents of the dwellings that is equal to or 
        greater than the protection provided under the housing quality 
        standards established under subsection (b), with such 
        applicable laws, regulations, standards, or codes; or
            (2) in the case of public housing located in a jurisdiction 
        which does not have in effect laws, regulations, standards, or 
        codes described in subparagraph (A), with the housing quality 
        standards established under subsection (b).
    (b) Federal Housing Quality Standards.--The Secretary shall 
establish housing quality standards under this subsection that ensure 
that public housing dwelling units are safe, clean, and healthy. Such 
standards shall include requirements relating to habitability, 
including maintenance, health and sanitation factors, condition, and 
construction of dwellings, and shall, to the greatest extent 
practicable, be consistent with the standards established under section 
328(b). The Secretary shall differentiate between major and minor 
violations of such standards.
    (c) Determinations.--Each local housing and management authority 
providing housing assistance shall identify, in the community 
improvement plan of the authority, whether the authority is utilizing 
the standard under paragraph (1) or (2) and, if the authority utilizes 
the standard under paragraph (1), shall certify in such plan that the 
applicable State or local laws, regulations, standards, or codes comply 
with the requirements under such paragraph.
    (d) Annual Inspections.--Each local housing and management 
authority that owns or operates public housing shall make an annual 
inspection of each public housing development to determine whether 
units in the development are maintained in accordance with the 
requirements under subsection (a)(2). The authority shall submit the 
results of such inspections to the Secretary and the Inspector General 
for the Department of Housing and Urban Development and such results 
shall be available to the Housing Foundation and Accreditation Board 
established under title IV and any auditor conducting an audit under 
section 432.

SEC. 234. EMPLOYMENT OF RESIDENTS.

    A local housing and management authority may employ public housing 
residents in any activities engaged in by the authority.

SEC. 235. RESIDENT COUNCILS AND RESIDENT MANAGEMENT CORPORATIONS.

    (a) Resident Councils.--The residents of a public housing 
development may establish a resident council for the development for 
purposes of consideration of issues relating to residents, 
representation of resident interests, and coordination and consultation 
with a local housing and management authority. A resident council shall 
be an organization or association that--
            (1) is nonprofit in character;
            (2) is representative of the residents of the eligible 
        housing;
            (3) adopts written procedures providing for the election of 
        officers on a regular basis; and
            (4) has a democratically elected governing board, which is 
        elected by the residents of the eligible housing.
    (b) Resident Management Corporations.--
            (1) Establishment.--The residents of a public housing 
        development may establish a resident management corporation for 
        the purpose of assuming the responsibility for the management 
        of the development under section 236 or purchasing a 
        development.
            (2) Requirements.--A resident management corporation shall 
        be a corporation that--
                    (A) is nonprofit in character;
                    (B) is organized under the laws of the State in 
                which the development is located;
                    (C) has as its sole voting members the residents of 
                the development; and
                    (D) is established by the resident council for the 
                development or, if there is not a resident council, by 
                a majority of the households of the development.

SEC. 236. MANAGEMENT BY RESIDENT MANAGEMENT CORPORATION.

    (a) Authority.--A local housing and management authority may enter 
into a contract under this section with a resident management 
corporation to provide for the management of public housing 
developments by the corporation.
    (b) Contract.--A contract under this section for management of 
public housing developments by a resident management corporation shall 
establish the respective management rights and responsibilities of the 
corporation and the local housing and management authority. The 
contract shall be consistent with the requirements of this Act 
applicable to public housing development and may include specific terms 
governing management personnel and compensation, access to public 
housing records, submission of and adherence to budgets, rent 
collection procedures, resident income verification, resident 
eligibility determinations, resident eviction, the acquisition of 
supplies and materials and such other matters as may be appropriate. 
The contract shall be treated as a contracting out of services.
    (c) Bonding and Insurance.--Before assuming any management 
responsibility for a public housing development, the resident 
management corporation shall provide fidelity bonding and insurance, or 
equivalent protection. Such bonding and insurance, or its equivalent, 
shall be adequate to protect the Secretary and the local housing and 
management authority against loss, theft, embezzlement, or fraudulent 
acts on the part of the resident management corporation or its 
employees.
    (d) Block Grant Assistance and Income.--A contract under this 
section shall provide for--
            (1) the local housing and management authority to provide a 
        portion of the block grant assistance under this title to the 
        resident management corporation for purposes of operating the 
        public housing development covered by the contract and 
        performing such other eligible activities with respect to the 
        development as may be provided under the contract;
            (2) the amount of income expected to be derived from the 
        development itself (from sources such as rents and charges);
            (3) the amount of income to be provided to the development 
        from the other sources of income of the local housing and 
        management authority (such as interest income, administrative 
        fees, and rents); and
            (4) any income generated by a resident management 
        corporation of a public housing development that exceeds the 
        income estimated under the contract shall be used for eligible 
        activities under section 203(a).
    (e) Calculation of Total Income.--
            (1) Maintenance of support.--Subject to paragraph (2), the 
        amount of assistance provided by a local housing and management 
        authority to a public housing development managed by a resident 
        management corporation may not be reduced during the 3-year 
        period beginning on the date on which the resident management 
        corporation is first established for the development.
            (2) Reductions and increases in support.--If the total 
        income of a local housing and management authority is reduced 
        or increased, the income provided by the local housing and 
        management authority to a public housing development managed by 
        a resident management corporation shall be reduced or increased 
        in proportion to the reduction or increase in the total income 
        of the authority, except that any reduction in block grant 
        amounts under this title to the authority that occurs as a 
        result of fraud, waste, or mismanagement by the authority shall 
        not affect the amount provided to the resident management 
        corporation.

SEC. 237. TRANSFER OF MANAGEMENT OF CERTAIN HOUSING TO INDEPENDENT 
              MANAGER AT REQUEST OF RESIDENTS.

    (a) Authority.--The Secretary may transfer the responsibility and 
authority for management of specified housing (as such term is defined 
in subsection (h)) from a local housing and management authority to an 
eligible management entity, in accordance with the requirements of this 
section, if--
            (1) such housing is owned or operated by a local housing 
        and management authority that is--
                    (A) not accredited under section 434 by the Housing 
                Foundation and Accreditation Board; or
                    (B) is designated as a troubled authority under 
                section 431(a)(2);
            (2) the Secretary determines that--
                    (A) such housing has deferred maintenance, physical 
                deterioration, or obsolescence of major systems and 
                other deficiencies in the physical plant of the 
                project;
                    (B) such housing is occupied predominantly by 
                families with children who are in a severe state of 
                distress, characterized by such factors as high rates 
                of unemployment, teenage pregnancy, single-parent 
                households, long-term dependency on public assistance 
                and minimal educational achievement;
                    (C) such housing is located in an area such that 
                the housing is subject to recurrent vandalism and 
                criminal activity (including drug-related criminal 
                activity); and
                    (D) the elements of distress for such housing 
                specified in subparagraphs (A) through (C) can be 
                remedied through improved management and reasonable 
                expenses for modernization.
Such a transfer may be made only as provided in this section, pursuant 
to the approval by the Secretary of a request for the transfer made by 
a majority vote of the resident council for the specified housing, 
after consultation with the local housing and management authority for 
the specified housing.
    (b) Block Grant Assistance.--Pursuant to a contract under 
subsection (c), the Secretary shall require the local housing and 
management authority for specified housing to provide to the manager 
for the housing, from any block grant amounts under this title for the 
authority, fair and reasonable amounts for operating costs for the 
housing. The amount made available under this subsection to a manager 
shall be determined by the Secretary based on the share for the 
specified housing of the total block grant amounts for the local 
housing and management authority transferring the housing, taking into 
consideration the operating and capital improvement needs of the 
specified housing, the operating and capital improvement needs of the 
remaining public housing units managed by the local housing and 
management authority, and the community improvement plan of such 
authority.
    (c) Contract Between Secretary and Manager.--
            (1) Requirements.--Pursuant to the approval of a request 
        under this section for transfer of the management of specified 
        housing, the Secretary shall enter into a contract with the 
        eligible management entity identified in the request to 
        transfer the responsibilities and authority for management of 
        the housing to such entity.
            (2) Terms.-- A contract under this subsection shall contain 
        provisions establishing the rights and responsibilities of the 
        manager with respect to the specified housing and the Secretary 
        and shall be consistent with the requirements of this Act 
        applicable to public housing developments.
    (d) Compliance With Community Improvement Plan.--A manager of 
specified housing under this section shall comply with the approved 
community improvement plan applicable to the housing and shall submit 
such information to the local housing and management authority from 
which management was transferred as may be necessary for such authority 
to prepare and update its community improvement plan.
    (e) Demolition and Disposition by Manager.--A manager under this 
section may demolish or dispose of specified housing only if, and in 
the manner, provided for in the community improvement plan for the 
authority transferring management of the housing.
    (f) Limitation on LHMA Liability.--A local housing and management 
authority that is not a manager for specified housing shall not be 
liable for any act or failure to act by a manager or resident council 
for the specified housing.
    (g) Treatment of Manager.--To the extent not inconsistent with this 
section and to the extent the Secretary determines not inconsistent 
with the purposes of this Act, a manager of specified housing under 
this section shall be considered to be a local housing and management 
authority for purposes of this title.
    (h) Definitions.--For purposes of this section, the following 
definitions shall apply:
            (1) Eligible management entity.--The term ``eligible 
        management entity'' means, with respect to any public housing 
        development, any of the following entities that has been 
        accredited in accordance with section 434:
                    (A) Nonprofit organization.--A public or private 
                nonprofit organization, which shall--
                            (i) include a resident management 
                        corporation and, as determined by the 
                        Secretary, a public or private nonprofit 
                        organization sponsored by the local housing and 
                        management authority that owns the development; 
                        and
                            (ii) not include the local housing and 
                        management authority that owns the development.
                    (B) For-profit entity.--A for-profit entity that 
                has demonstrated experience in providing low-income 
                housing.
                    (C) State or local government.--A State or local 
                government, including an agency or instrumentality 
                thereof.
                    (D) local housing and management authority.--A 
                local housing and management authority (other than the 
                local housing and management authority that owns the 
                development).
        The term does not include a resident council.
            (2) Manager.--The term ``manager'' means any eligible 
        management entity that has entered into a contract under this 
        section with the Secretary for the management of specified 
        housing.
            (3) Nonprofit.--The term ``nonprofit'' means, with respect 
        to an organization, association, corporation, or other entity, 
        that no part of the net earnings of the entity inures to the 
        benefit of any member, founder, contributor, or individual.
            (4) Private nonprofit organization.--The term ``private 
        nonprofit organization'' means any private organization 
        (including a State or locally chartered organization) that--
                    (A) is incorporated under State or local law;
                    (B) is nonprofit in character;
                    (C) complies with standards of financial 
                accountability acceptable to the Secretary; and
                    (D) has among its purposes significant activities 
                related to the provision of decent housing that is 
                affordable to low-income families.
            (5) Local housing and management authority.--The term 
        ``local housing and management authority'' has the meaning 
        given such term in section 103(a), except that it does not 
        include Indian housing authorities.
            (6) Public nonprofit organization.--The term ``public 
        nonprofit organization'' means any public entity that is 
        nonprofit in character.
            (7) Specified housing.--The term ``specified housing'' 
        means a public housing development or developments, or a 
        portion of a development or developments, for which the 
        transfer of management is requested under this section. The 
        term includes one or more contiguous buildings and an area of 
        contiguous row houses, but in the case of a single building, 
        the building shall be sufficiently separable from the remainder 
        of the development of which it is part to make transfer of the 
        management of the building feasible for purposes of this 
        section.

                       Subtitle D--Homeownership

SEC. 251. RESIDENT HOMEOWNERSHIP PROGRAMS.

    (a) In General.--A local housing and management authority may carry 
out a homeownership program in accordance with this section and the 
community improvement plan of the authority to make public housing 
dwelling units, public housing developments, and other housing projects 
available for purchase by low-income families.
    (b) Participating Units.--A program under this section may cover 
any existing public housing dwelling units or projects, and may include 
other dwelling units and housing owned, operated, or assisted, or 
otherwise acquired for use under such program, by the local housing and 
management authority.
    (c) Eligible Purchasers.--
            (1) Low-income requirement.--Only low-income families 
        assisted by a local housing and management authority and other 
        low-income families shall be eligible to purchase housing under 
        a homeownership program under this section.
            (2) Other requirements.--A local housing and management 
        authority may establish other requirements or limitations for 
        families to purchase housing under a homeownership program 
        under this section, including requirements or limitations 
        regarding employment or participation in employment counseling 
        or training activities, criminal activity, participation in 
        homeownership counseling programs, evidence of regular income, 
        and other requirements.
    (d) Financing and Assistance.--A homeownership program under this 
section may provide financing for acquisition of housing by families 
purchasing under the program or by the local housing and management 
authority for sale under this program in any manner considered 
appropriate by the authority (including sale to a resident management 
corporation).
    (e) Downpayment Requirement.--Each family purchasing housing under 
a homeownership program under this section shall be required to provide 
from its own resources a downpayment in connection with any loan for 
acquisition of the housing, in an amount determined by the local 
housing and management authority.
    (f) Ownership Interests.--A homeownership program under this 
section may provide for sale to the purchasing family of any ownership 
interest that the local housing and management authority considers 
appropriate under the program, including ownership in fee simple, a 
condominium interest, an interest in a limited dividend cooperative, a 
shared appreciation interest with a local housing and management 
authority providing financing.
    (g) Resale.--
            (1) Authority and limitation.--A homeownership program 
        under this section shall permit the resale of a dwelling unit 
        purchased under the program by an eligible family, but shall 
        provide such limitations on resale as the authority considers 
        appropriate for the authority to recapture, from any economic 
        gain derived from such resale, a portion of the amount of any 
        financial assistance provided under the program by the 
        authority to the eligible family.
            (2) Considerations.--The limitations referred to in 
        paragraph (1) may provide for consideration of the aggregate 
        amount of assistance provided under the program to the family, 
        the contribution to equity provided by the purchasing eligible 
        family, the period of time elapsed between purchase under the 
        homeownership program and resale, the reason for resale, any 
        improvements to the property made by the eligible family, any 
        appreciation in the value of the property, and any other 
        factors that the authority considers appropriate.
    (h) Applicability of Disposition Requirements.--The provisions of 
section 261 shall apply to disposition of public housing dwelling units 
under a homeownership program under this section and any dwelling units 
sold under a homeownership program under this section shall be treated 
as public housing dwelling units for purposes of subsections (e) and 
(f) of section 261.

         Subtitle E--Disposition and Demolition of Developments

SEC. 261. REQUIREMENTS FOR DEMOLITION AND DISPOSITION OF DEVELOPMENTS.

    (a) Authority and Flexibility.--A local housing and management 
authority may demolish, dispose of, or demolish and dispose of 
nonviable or nonmarketable public housing developments of the authority 
in accordance with this section.
    (b) Community Improvement Plan Requirement.--A local housing and 
management authority may take any action to demolish or dispose of a 
public housing development (or a portion of a development) only if such 
demolition or disposition complies with the provisions of this section 
and is in accordance with the community improvement plan for the 
authority.
    (c) Purpose of Demolition or Disposition.--A local housing and 
management authority may demolish or dispose of a public housing 
development (or portion of a development) only if--
            (1) the development (or portion thereof) is severely 
        distressed or obsolete;
            (2) the development (or portion thereof) is in a location 
        making it unsuitable for housing purposes;
            (3) the development (or portion thereof) has design or 
        construction deficiencies that make cost-effective 
        rehabilitation infeasible;
            (4) assuming that reasonable rehabilitation and management 
        intervention for the development has been completed and paid 
        for, the anticipated revenue that would be derived from 
        charging market-based rents for units in the development (or 
        portion thereof) would not cover the anticipated operating 
        costs and replacement reserves of the development (or portion) 
        at full occupancy and the development (or portion) would 
        constitute a substantial burden on the resources of the local 
        housing and management authority;
            (5) retention of the development (or portion thereof) is 
        not in the best interests of the residents of the local housing 
        and management authority because--
                    (A) developmental changes in the area surrounding 
                the development adversely affect the health or safety 
                of the residents or the feasible operation of the 
                development by the local housing and management 
                authority;
                    (B) demolition or disposition will allow the 
                acquisition, development, or rehabilitation of other 
                properties which will be more efficiently or 
                effectively operated as low-income housing; or
                    (C) other factors exist that the authority 
                determines are consistent with the best interests of 
                the residents and the authority and not inconsistent 
                with other provisions of this Act (which may include 
                use of public housing dwelling units in a homeownership 
                program under subtitle D);
            (6) in the case only of demolition or disposition of a 
        portion of a development, the demolition or disposition will 
        help to ensure the remaining useful life of the remainder of 
        the development; or
            (7) in the case only of property other than dwelling 
        units--
                    (A) the property is excess to the needs of a 
                development; or
                    (B) the demolition or disposition is incidental to, 
                or does not interfere with, continued operation of a 
                development.
    (d) Consultation.--A local housing and management authority may 
demolish or dispose of a public housing development (or portion of a 
development) only if the authority notifies and confers regarding the 
demolition or disposition with--
            (1) the residents of the development (or portion); and
            (2) appropriate local government officials.
    (e) Use of Proceeds.--Any net proceeds from the disposition of a 
public housing development (or portion of a development) shall be used 
for--
            (1) housing assistance for low-income families that is 
        consistent with the low-income housing needs of the community, 
        through acquisition, development, or rehabilitation of, or 
        homeownership programs for, other low-income housing or the 
        provision of choice-based assistance under title III for such 
        families;
            (2) supportive services relating to job training or child 
        care for residents of a development or developments; or
            (3) leveraging amounts for securing commercial enterprises, 
        on-site in public housing developments of the local housing and 
        management authority, appropriate to serve the needs of the 
        residents.
    (f) Relocation.--A local housing and management authority that 
demolishes or disposes of a public housing development (or portion of a 
development thereof) shall ensure that--
            (1) each family that is a resident of the development (or 
        portion) that is demolished or disposed of is relocated to 
        other safe, clean, healthy, and affordable housing, which is, 
        to the maximum extent practicable, housing of the family's 
        choice or is provided with choice-based assistance under title 
        III;
            (2) the local housing and management authority does not 
        take any action to dispose of any unit until any resident to be 
        displaced is relocated in accordance with paragraph (1); and
            (3) each resident family to be displaced is paid relocation 
        expenses, and the rent to be paid initially by the resident 
        following relocation does not exceed the amount permitted under 
        section 225(a).
    (g) Right of First Refusal for Resident Organizations and Resident 
Management Corporations.--
            (1) In general.--A local housing and management authority 
        may not dispose of a public housing development (or portion of 
        a development) unless the authority has, before such 
        disposition, offered to sell the property, as provided in this 
        subsection, to each resident organization and resident 
        management corporation operating at the development for 
        continued use as low-income housing, and no such 
organization or corporation purchases the property pursuant to such 
offer.
            (2) Timing.--Disposition of a development (or portion 
        thereof) under this section may not take place--
                    (A) before the expiration of the period during 
                which any such organization or corporation may notify 
                the authority of interest in purchasing the property, 
                which shall be the 30-day period beginning on the date 
                that the authority first provides notice of the 
                proposed disposition of the property to such resident 
                organizations and resident management corporations;
                    (B) if an organization or corporation submits 
                notice of interest in accordance with subparagraph (A), 
                before the expiration of the period during which such 
                organization or corporation may obtain a commitment for 
                financing to purchase the property, which shall be the 
                60-day period beginning upon the submission to the 
                authority of the notice of interest; or
                    (C) if, during the period under subparagraph (B), 
                an organization or corporation obtains such financing 
                commitment and makes a bona fide offer to the authority 
                to purchase the property for a price equal to or 
                exceeding the applicable offer price under paragraph 
                (3).
        The authority shall sell the property pursuant to any purchase 
        offer described in subparagraph (C).
            (3) Terms of offer.--An offer by a local housing and 
        management authority to sell a property in accordance with this 
        subsection shall involve a purchase price that reflects the 
        market value of the property.
    (h) Information for Community Improvement Plan.--A local housing 
and management authority may demolish or dispose of a public housing 
development (or portion thereof) only if it includes in the applicable 
community improvement plan information sufficient to describe--
            (1) the housing to be demolished or disposed of;
            (2) the purpose of the demolition or disposition under 
        subsection (c) and why the demolition or disposition complies 
        with the requirements under subsection (c);
            (3) how the consultations required under subsection (d) 
        will be made;
            (4) how the net proceeds of the disposition will be used in 
        accordance with subsection (e);
            (5) how the authority will relocate residents, if 
        necessary, as required under subsection (f); and
            (6) that the authority has offered the property for 
        acquisition by resident organizations and resident management 
        corporations in accordance with subsection (g).
    (i) Site and Neighborhood Standards Exemption.--Notwithstanding any 
other provision of law, a local housing and management authority may 
provide for development of public housing dwelling units on the same 
site or in the same neighborhood as any dwelling units demolished, 
pursuant to a plan under this section, but only if such development 
provides for significantly fewer dwelling units.
    (j) Treatment of Replacement Units.--In connection with any 
demolition or disposition of public housing under this section, a local 
housing and management authority may provide for other housing 
assistance for low-income families that is consistent with the low-
income housing needs of the community, including--
            (1) the provision of choice-based assistance under title 
        III; and
            (2) the development, acquisition, or lease by the authority 
        of dwelling units, which dwelling units shall--
                    (A) be eligible to receive assistance with grant 
                amounts provided under this title; and
                    (B) be made available for occupancy, operated, and 
                managed in the manner required for public housing, and 
                subject to the other requirements applicable to public 
                housing dwelling units.
    (k) Permissible Relocation Without Plan.--If a local housing and 
management authority determines that public housing dwelling units are 
not clean, safe, and healthy or cannot be maintained cost-effectively 
in a clean, safe, and healthy condition, the local housing and 
management authority may relocate residents of such dwelling units 
before the submission of a community improvement plan providing for 
demolition or disposition of such units.
    (l) Consolidation of Occupancy Within or Among Buildings.--Nothing 
in this section may be construed to prevent a local housing and 
management authority from consolidating occupancy within or among 
buildings of a public housing development, or among developments, or 
with other housing for the purpose of improving living conditions of, 
or providing more efficient services to, residents.
    (m) De Minimis Exception to Demolition Requirements.--
Notwithstanding any other provision of this section, in any 5-year 
period a local housing and management authority may demolish not more 
than the lesser of 5 dwelling units or 5 percent of the total dwelling 
units owned and operated by the local housing and management authority, 
without providing for such demolition in a community improvement plan, 
but only if the space occupied by the demolished unit is used for 
meeting the service or other needs of public housing residents or the 
demolished unit was beyond repair.

                     Subtitle F--General Provisions

SEC. 271. CONVERSION TO BLOCK GRANT ASSISTANCE.

    (a) Savings Provisions.--Any amounts made available to a public 
housing agency for assistance for public housing pursuant to the United 
States Housing Act of 1937 (or any other provision of law relating to 
assistance for public housing) under an appropriation for fiscal year 
1996 or any previous fiscal year shall be subject to the provisions of 
such Act as in effect before the enactment of this Act, notwithstanding 
the repeals made by this Act, except to the extent the Secretary 
provides otherwise to provide for the conversion of public housing and 
public housing assistance to the system provided under this Act.
    (b) Modifications.--Notwithstanding any provision of this Act or 
any annual contributions contract or other agreement entered into by 
the Secretary and a public housing agency pursuant to the provisions of 
the United States Housing Act of 1937 (as in effect before the 
enactment of this Act), the Secretary and the agency may by mutual 
consent amend, supersede, modify any such agreement as appropriate to 
provide for assistance under this title, except that the Secretary and 
the agency may not consent to any such amendment, supersession, or 
modification that substantially alters any outstanding obligations 
requiring continued maintenance of the low-income character of any 
public housing development and any such amendment, supersession, or 
modification shall not be given effect.

SEC. 272. PAYMENT OF NON-FEDERAL SHARE.

    Rental or use-value of buildings or facilities paid for, in whole 
or in part, from production, modernization, or operation costs financed 
under this title may be used as the non-Federal share required in 
connection with activities undertaken under Federal grant-in-aid 
programs which provide social, educational, employment, and other 
services to the residents in a project assisted under this title.

SEC. 273. DEFINITIONS.

    For purposes of this title, the following definitions shall apply:
            (1) Acquisition cost.--The term ``acquisition cost'' means 
        the amount prudently expended by a local housing and management 
        authority in acquiring property for a public housing 
        development.
            (2) Development.--The terms ``public housing development'' 
        and ``development'' mean--
                    (A) public housing; and
                    (B) the improvement of any such housing.
            (3) Eligible local housing and management authority.--The 
        term ``eligible local housing and management authority'' means, 
        with respect to a fiscal year, a local housing and management 
        authority that is eligible under section 202(b) for a grant 
        under this title.
            (4) Group home and independent living facility.--The terms 
        ``group home'' and ``independent living facility'' have the 
        meanings given such terms in section 811(k) of the Cranston-
        Gonzalez National Affordable Housing Act.
            (5) Operation.--The term ``operation'' means any or all 
        undertakings appropriate for management, operation, services, 
        maintenance, security (including the cost of security 
        personnel), or financing in connection with a public housing 
        development, including the financing of resident programs and 
        services.
            (6) Production.--The term ``production'' means any or all 
        undertakings necessary for planning, land acquisition, 
        financing, demolition, construction, or equipment, in 
        connection with the construction, acquisition, or 
        rehabilitation of a property for use as a public housing 
        development, including activity in connection with a public 
        housing development that is confined to the reconstruction, 
        remodeling, or repair of existing buildings.
            (7) Production cost.--The term ``production cost'' means 
        the costs incurred by a local housing and management authority 
        for production of public housing and the necessary financing 
        for production (including the payment of carrying charges and 
        acquisition costs).
            (8) Resident council.--The term ``resident council'' means 
        an organization or association that meets the requirements of 
        section 235(a).
            (9) Resident management corporation.--The term ``resident 
        management corporation'' means a corporation that meets the 
        requirements of section 235(b).
            (10) Resident program.--The term ``resident programs and 
        services'' means programs and services for families residing in 
        public housing developments. Such term includes (A) the 
        development and maintenance of resident organizations which 
        participate in the management of public housing developments, 
        (B) the training of residents to manage and operate the public 
        housing development and the utilization of their services in 
        management and operation of the development, (C) counseling on 
        household management, housekeeping, budgeting, money 
        management, homeownership issues, child care, and similar 
        matters, (D) advice regarding resources for job training and 
        placement, education, welfare, health, and other community 
        services, (E) services that are directly related to meeting 
        resident needs and providing a wholesome living environment; 
        and (F) referral to appropriate agencies in the community when 
        necessary for the provision of such services. To the maximum 
        extent available and appropriate, existing public and private 
        agencies in the community shall be used for the provision of 
        such services.

SEC. 274. AUTHORIZATION OF APPROPRIATIONS.

    (a) Block Grants.--There is authorized to be appropriated, for 
block grants under this title, $5,500,000,000 for each of fiscal years 
1996, 1997, 1998, 1999, and 2000.
    (b) Operation Safe Home.--There is authorized to be appropriated, 
for assistance for relocating residents of public housing under the 
operation safe home program of the Department of Housing and Urban 
Development (including assistance for costs of relocation and housing 
assistance under title III), $700,000 for each of fiscal years 1996, 
1997, 1998, 1999, and 2000.

TITLE III--CHOICE-BASED RENTAL HOUSING AND HOMEOWNERSHIP ASSISTANCE FOR 
                          LOW-INCOME FAMILIES

                   Subtitle A--Grants and Allocation

SEC. 301. AUTHORITY TO PROVIDE HOUSING ASSISTANCE GRANTS.

    To the extent that amounts to carry out this title are made 
available, the Secretary may make grants to local housing and 
management authorities for each fiscal year to provide housing 
assistance under this title.

SEC. 302. GRANT AGREEMENTS.

    (a) Authority.--The Secretary may make a grant under this title to 
a local housing and management authority for a fiscal year only if the 
Secretary has entered into a grant agreement under this section with 
the local housing and management authority, under which the Secretary 
shall provide such authority with grant amounts (in the amount of the 
allocation for the authority determined pursuant to section 303) for 
housing assistance under this title for low-income families.
    (b) Use for Housing Assistance.--A grant agreement shall require a 
local housing and management authority to use amounts from a grant 
under this title to provide housing assistance in any manner authorized 
under this title.
    (c) Annual Obligation of Authority.--A grant under this title shall 
provide amounts for housing assistance for 1 fiscal year covered by the 
grant agreement.
    (d) Enforcement of Housing Quality Requirements.--Each grant 
agreement shall require the local housing and management authority 
administering assistance provided under the agreement--
            (1) to ensure compliance, under each housing assistance 
        payments contract entered into pursuant to such grant, with the 
        provisions of such contract included pursuant to section 
        351(c)(4); and
            (2) to establish procedures for assisted families to notify 
        the authority of any noncompliance with such provisions.

SEC. 303. ALLOCATION OF AMOUNTS.

    (a) Formula Allocation.--
            (1) In general.--When amounts for grants under this title 
        are first made available for reservation, after reserving 
        amounts in accordance with subsection (c) and section 109, the 
        Secretary shall allocate such amounts on the basis of a formula 
        established in accordance with paragraph (2) and is based on 
        appropriate criteria to reflect the needs of different States, 
        areas, and communities, using the most recent data available 
        from the Bureau of the Census of the Department of Commerce and 
        the comprehensive housing affordability strategy under section 
        105 of the Cranston-Gonzalez National Affordable Housing Act 
        for the applicable jurisdiction.
            (2) Regulations.--The formula under this subsection shall 
        be established by regulation issued by the Secretary. 
        Notwithstanding sections 563(a) and 565(a) of title 5, United 
        States Code, any proposed regulation containing such formula 
        shall be issued pursuant to a negotiated rulemaking procedure 
        under subchapter of chapter 5 of such title and the Secretary 
        shall establish a negotiated rulemaking committee for 
        development of any such proposed regulations.
    (b) Allocation Considerations.--
            (1) Limitation on reallocation for another state.--Any 
        amounts allocated for a State or areas or communities within a 
        State that are not likely to be used within a the fiscal year 
        for which the grant is made shall not be reallocated for use in 
        another State, unless the Secretary determines that other areas 
        or communities within the same State (that are eligible for 
        grant amounts under this title) cannot use the amounts within 
        the same fiscal year.
            (2) Effect of receipt of tenant-based assistance for 
        disabled families.--The Secretary may not consider the receipt 
        by a local housing and management authority of assistance under 
        section 811(b)(1) of the Cranston-Gonzalez National Affordable 
        Housing Act, or the amount received, in approving amounts under 
        this title for the authority or in determining the amount of 
        such assistance to be provided to the authority.
            (3) Exemption from formula allocation.--The formula 
        allocation requirements of subsection (a) shall not apply to 
        any assistance under this title that is approved in 
        appropriation Acts for uses that the Secretary determines are 
        incapable of geographic allocation, including amendments of 
        existing housing assistance payments contracts, renewal of such 
        contracts, assistance to families that would otherwise lose 
        assistance due to the decision of the project owner to prepay 
        the project mortgage or not to renew the housing assistance 
        payments contract, assistance to prevent displacement or to 
        provide replacement housing in connection with the demolition 
        or disposition of public and Indian housing, assistance for 
        relocation from public housing, assistance in connection with 
        protection of crime witnesses, assistance for conversion from 
        leased housing contracts under section 23 of the United States 
        Housing Act of 1937 (as in effect before the enactment of the 
        Housing and Community Development Act of 1974), and assistance 
        in support of the property disposition and loan management 
        functions of the Secretary.
    (c) Set-Aside for Indian Housing Assistance.--The Secretary shall 
allocate, in a manner determined by the Secretary, a portion of the 
amounts made available in each fiscal year for grants under this title 
for grants for Indian housing authorities.
    (d) Recapture Upon Turnover for Reallocation.--
            (1) Authority.--In each fiscal year, from any budget 
        authority made available for assistance under this title or 
        section 8 of the United States Housing Act of 1937 (as in 
        effect before the enactment of this Act) that is obligated to a 
        local housing and management authority but remains unobligated 
        by the authority upon the expiration of the 8-month period 
        beginning upon the initial availability of such amounts for 
        obligation by the authority, the Secretary may deobligate an 
        amount, as determined by the Secretary, not exceeding 50 
        percent of such budget authority.
            (2) Use.--The Secretary may reallocate and transfer any 
        amounts deobligated under paragraph (1) only to local housing 
        and management authorities in areas that the Secretary 
        determines have received less funding than other areas, based 
        on the relative needs of all areas.

SEC. 304. ADMINISTRATIVE FEES.

    (a) Establishment of Fee and Use of Grant Amounts.--The Secretary 
shall establish a fee for the costs incurred by a local housing and 
management authority in administering the program for housing 
assistance under this title. Notwithstanding any other provision of 
this title, a local housing and management authority may use grant 
amounts provided under this title in the amount of the fee authorized 
under this section for such costs.
    (b) Amount.--The amount of the fee under subsection (a) for a grant 
for a fiscal year under any grant agreement shall be equal to 6.0 
percent of the total grant amount provided to the local housing and 
management authority for the fiscal year. The Secretary may increase 
the fee if necessary to reflect the higher costs of administering small 
programs and programs operating over large geographic areas.

SEC. 305. AUTHORIZATIONS OF APPROPRIATIONS.

    There is authorized to be appropriated, for grants under this title 
for providing housing assistance, $862,000,000 for each of fiscal years 
1996, 1997, 1998, 1999, and 2000.

SEC. 306. CONVERSION OF SECTION 8 ASSISTANCE.

    Any amounts made available to a local housing and management 
authority under a contract for annual contributions for assistance 
under section 8 of the United States Housing Act of 1937 (as in effect 
before the enactment of this Act) that have not been obligated for such 
assistance by such authority before such enactment shall be used to 
provide assistance under this title, except to the extent the Secretary 
determines such use is inconsistent with existing commitments.

   Subtitle B--Choice-Based Housing Assistance for Eligible Families

SEC. 321. ELIGIBLE FAMILIES AND PREFERENCES FOR ASSISTANCE.

    (a) Low-Income Requirement.--Housing assistance under this title 
may be provided only on behalf of a family that--
            (1) at the time that such assistance is initially provided 
        on behalf of the family and at the time of the most recent 
        review of the income of the family for purposes of this title, 
        is determined by the local housing and management authority to 
        be a low-income family; or
            (2) qualifies to receive such assistance under any other 
        provision of Federal law.
    (b) Reviews of Family Incomes.--
            (1) In general.--Reviews of family incomes for purposes of 
        this title shall be subject to the provisions of section 904(e) 
        of the Stewart B. McKinney Homeless Assistance Amendments Act 
        of 1988 and shall be conducted upon the initial provision of 
        housing assistance for the family and thereafter not less 
        than--
                    (A) once every 3 years, in the cases of elderly 
                families and disabled families; and
                    (B) annually, in the case of nonelderly families.
            (2) Procedures.--Each local housing and management 
        authority administering housing assistance under this title 
        shall establish procedures that are appropriate and necessary 
        to ensure that income data provided to the authority and owners 
        by families applying for or receiving housing assistance from 
        the authority is complete and accurate.
    (c) Preferences for Assistance.--
            (1) Authority to establish.--Any local housing and 
        management authority that receives grant amounts under this 
        title may establish a system for making housing assistance 
        available on behalf of eligible families that provides 
        preference for such assistance to eligible families having 
        certain characteristics.
            (2) Content.--Each system of preferences established 
        pursuant to this subsection shall be based upon local housing 
        needs and priorities, as determined by the local housing and 
        management authority.
    (d) Treatment of Assisted Families Who Move Out of Jurisdiction of 
LHMA.--A local housing and management authority may, in the discretion 
of the agency and notwithstanding any preferences under subsection (c), 
provide housing assistance for eligible families (or a certain number 
of such families) who have moved into the jurisdiction of the authority 
and on whose behalf such assistance was being provided, at the time of 
such move, by the authority for the jurisdiction from which the family 
moved.
    (e) Treatment of Families on Waiting List Who Move Out of 
Jurisdiction of LHMA.--
            (1) Move to jurisdiction with open waiting list.--Except as 
        provided in paragraph (2), if an eligible family (A) applies 
        for choice-based housing assistance while residing within the 
        jurisdiction of a local housing and management authority, (B) 
        moves outside of the jurisdiction of the authority before such 
        assistance is provided on behalf of the family, and (C) applies 
        for housing assistance from the local housing and management 
        authority for the jurisdiction to which the family moves, such 
        authority shall consider the application to have been made upon 
        the date that the family applied for assistance with the 
        authority in whose jurisdiction the family previously resided.
            (2) Move to jurisdiction with closed waiting list.--If the 
        local housing and management authority for the jurisdiction to 
        which an eligible family described in paragraph (1) moves is 
        not generally accepting applications for housing assistance, 
        such jurisdiction shall accept the application of such family 
        but shall treat the application as having been made on the date 
        on which it is actually made.
    (f) Authority to Deny Assistance to Certain Families Who Move.--A 
local housing and management authority may establish criteria for 
denying housing assistance, and pursuant to such criteria may deny such 
assistance, to an eligible family who has moved from the jurisdiction 
of another authority, who received housing assistance from the 
authority for such other jurisdiction, and whose assistance was 
terminated by such other authority for reasons other than income 
ineligibility or the change of residence.

SEC. 322. RESIDENT CONTRIBUTION.

    (a) In General.--An assisted family shall contribute on a monthly 
basis for the rental of an assisted dwelling unit an amount that the 
local housing and management authority determines is appropriate with 
respect to the family and the unit, which shall be--
            (1) based upon factors including the adjusted income of the 
        family, the type and size of the dwelling unit, and any other 
        factors that the authority considers appropriate;
            (2) not less than $50; and
            (3) not more than the applicable payment standard 
        established under section 353 for the size and type of the 
        assisted dwelling unit for the area in which the unit is 
        located.
    (b) Rental Contribution for Elderly and Disabled Families.--In 
establishing the amount of monthly rental contributions under this 
section for disabled families and elderly families residing in assisted 
dwelling units, a local housing and management authority shall waive 
the applicability of any provision of subsection (a) that may be 
necessary to establish such contributions that are reasonable based on 
the adjusted incomes of such families.

SEC. 323. RENTAL INDICATORS.

    (a) In General.--The Secretary shall establish and issue rental 
indicators under this section periodically, but not less than annually, 
for existing rental dwelling units that are eligible dwelling units. 
The Secretary shall establish and issue the rental indicators by 
housing market area (as the Secretary shall establish) for various 
sizes and types of dwelling units.
    (b) Amount.--For a market area, the rental indicator established 
under subsection (a) for a dwelling unit of a particular size and type 
in the market area shall be a dollar amount that reflects the rental 
amount for a standard quality rental unit of such size and type in the 
market area that is an eligible dwelling unit.
    (c) Effective Date.--The Secretary shall cause the proposed rental 
indicators established under subsection (a) for each market area to be 
published in the Federal Register with reasonable time for public 
comment, and such rental indicators shall become effective upon the 
date of publication in final form in the Federal Register.
    (d) Annual Adjustment.--Each rental indicator in effect under this 
section shall be adjusted to be effective on October 1 of each year to 
reflect changes, based on the most recent available data trended so 
that the indicators will be current for the year to which they apply, 
in rents for existing rental dwelling units of various sizes and types 
in the market area suitable for occupancy by families assisted under 
this title.

SEC. 324. LEASE TERMS.

    Rental assistance may be provided for an eligible dwelling unit 
only if the assisted family and the owner of the dwelling unit enter 
into a lease for the unit that--
            (1) has a lease term that is agreed to by the owner and the 
        assisted family;
            (2) contains terms and conditions specifying that 
        termination of tenancy during the term of a lease shall be 
        subject to the provisions set forth in section 325;
            (3) is set forth in the standard form, which is used in the 
        local housing market area by the owner and applies generally to 
        any other tenants in the property who are not assisted 
        families, together with any addendum necessary to include the 
        many terms required under this section; and
            (4) contains other terms and conditions that the local 
        housing and management authority determines are appropriate.

SEC. 325. TERMINATION OF TENANCY.

    (a) General Grounds for Termination of Tenancy.--Each housing 
assistance payments contract under section 351 shall provide that the 
owner of any assisted dwelling unit assisted under the contract may, 
before expiration of a lease for a unit, terminate the tenancy of any 
tenant of the unit, but only for--
            (1) violation of the terms and conditions of the lease, 
        violation of applicable Federal, State, or local law, or other 
        good cause; or
            (2) any activity, engaged in by the tenant, any member of 
        the tenant's household, or any guest or other person under the 
        tenant's control (regardless of whether the resident had actual 
        knowledge of such activity), that--
                    (A) threatens the health or safety of, or right to 
                peaceful enjoyment of the premises by, other tenants or 
                employees of the owner or manager of the housing;
                    (B) threatens the health or safety of, or right to 
                peaceful enjoyment of their residences by, persons 
                residing in the immediate vicinity of the premises; or
                    (C) is criminal activity (including drug-related 
                criminal activity).
    (b) Manner of Termination.--Each housing assistance payments 
contract shall provide that the owner shall conduct the termination of 
tenancy of any tenant of an assisted dwelling unit under the contract 
in accordance with applicable State or local laws, including providing 
any notice of termination required under such laws.

SEC. 326. ELIGIBLE OWNERS.

    (a) Ownership Entity.--Rental assistance under this title may be 
provided for any eligible dwelling unit for which the owner is any 
public agency, private person or entity (including a cooperative), 
nonprofit organization, agency of the Federal Government, or local 
housing and management authority.
    (b) Ineligible Owners.--Notwithstanding subsection (a), a local 
housing and management authority may not provide rental assistance 
under this title for the rental of a dwelling unit if the owner of the 
unit is debarred, suspended, or subject to limited denial of 
participation under part 24 of title 24, Code of Federal Regulations.

SEC. 327. SELECTION OF DWELLING UNITS.

    The determination of the dwelling unit in which an assisted family 
resides and for which housing assistance is provided under this title 
shall be made solely by the assisted family, subject to the provisions 
of this title.

SEC. 328. ELIGIBLE DWELLING UNITS.

    (a) In General.--A dwelling unit shall be an eligible dwelling unit 
for purposes of this title only if the local housing and management 
authority to provide housing assistance for the dwelling unit--
            (1) determines that the dwelling unit is an existing 
        dwelling unit that is not located within a nursing home or the 
        grounds of any penal, reformatory, medical, mental, or similar 
        public or private institution;
            (2) determines that the dwelling unit complies--
                    (A) with applicable State or local laws, 
                regulations, standards, or codes regarding habitability 
                of residential dwellings that--
                            (i) are in effect for the jurisdiction in 
                        which the dwelling unit is located;
                            (ii) provide protection to residents of the 
                        dwellings that is equal to or greater than the 
                        protection provided under the housing quality 
                        standards established under subsection (b); and
                            (iii) that do not severely restrict housing 
                        choice; or
                    (B) in the case of a dwelling unit located in a 
                jurisdiction which does not have in effect laws, 
                regulations, standards, or codes described in 
                subparagraph (A), with the housing quality standards 
                established under subsection (b); and
            (3) makes the determinations required under paragraphs (1) 
        and (2) pursuant to an inspection of the dwelling unit 
conducted before any assistance payment is made for the unit.
Each local housing and management authority providing housing 
assistance shall identify, in the community improvement plan for the 
authority, whether the authority is utilizing the standard under 
subparagraph (A) or (B) of paragraph (2) and, if the authority utilizes 
the standard under subparagraph (A), shall certify in such plan that 
the applicable State or local laws, regulations, standards, or codes 
comply with the requirements under such subparagraph.
    (b) Federal Housing Quality Standards.--The Secretary shall 
establish housing quality standards under this subsection that ensure 
that assisted dwelling units are safe, clean, and healthy. Such 
standards shall include requirements relating to habitability, 
including maintenance, health and sanitation factors, condition, and 
construction of dwellings, and shall, to the greatest extent 
practicable, be consistent with the standards established under section 
233(b). The Secretary shall differentiate between major and minor 
violations of such standards.
    (c) Annual Inspections.--Each local housing and management 
authority providing housing assistance shall make an annual inspection 
of each assisted dwelling unit during the term of the housing 
assistance payments contracts for the unit to determine whether the 
unit is maintained in accordance with the requirements under subsection 
(a)(2). The authority shall submit the results of such inspections to 
the Secretary and the Inspector General for the Department of Housing 
and Urban Development and such results shall be available to the 
Housing Foundation and Accreditation Board established under title IV 
and any auditor conducting an audit under section 432.
    (d) Inspection Guidelines.--The Secretary shall establish 
procedural guidelines and performance standards to facilitate 
inspections of dwelling units and conform such inspections with 
practices utilized in the private housing market. Such guidelines and 
standards shall take into consideration variations in local laws and 
practices of local housing and management authorities and shall provide 
flexibility to authorities appropriate to facilitate efficient 
provision of assistance under this title.
    (e) Rule of Construction.--This section may not be construed to 
prevent the provision of housing assistance in connection with 
supportive services for elderly or disabled families.

SEC. 329. HOMEOWNERSHIP OPTION.

    (a) In General.--A local housing and management authority providing 
housing assistance under this title may provide homeownership 
assistance to assist eligible families to purchase a dwelling unit.
    (b) Requirements.--A local housing and management authority 
providing homeownership assistance under this section shall, as a 
condition of an eligible family receiving such assistance, require the 
family to--
            (1) demonstrate that the family has income from employment 
        or other sources (other than public assistance), as determined 
        in accordance with requirements established by the authority; 
        and
            (2) meet any other initial or continuing requirements 
        established by the local housing and management authority.
    (c) Downpayment Requirement.--A local housing and management 
authority may establish minimum downpayment requirements, if 
appropriate, in connection with loans made for the purchase of dwelling 
units for which homeownership assistance is provided under this 
section.

SEC. 330. ADMINISTRATIVE GRIEVANCE PROCEDURE.

    Each local housing and management authority providing housing 
assistance with grant amounts under this title shall establish and 
implement an administrative grievance procedure under which assisted 
families will have an opportunity for disposition of grievances 
concerning adverse housing management authority actions.

    Subtitle C--Payment of Housing Assistance on Behalf of Assisted 
                                Families

SEC. 351. HOUSING ASSISTANCE PAYMENTS CONTRACTS.

    (a) In General.--Each local housing and management authority that 
receives amounts under a grant agreement may enter into housing 
assistance payments contracts with owners of existing dwelling units to 
make housing assistance payments to such owners in accordance with this 
title.
    (b) LHMA Acting As Owner.--A local housing and management authority 
may enter into a housing assistance payments contract to make housing 
assistance payments under this title to itself (or any agency or 
instrumentality thereof) as the owner of dwelling units, and the 
authority shall be subject to the same requirements that are applicable 
to other owners.
    (c) Provisions.--Each housing assistance payments contract shall--
            (1) have a term of not less than 1 month nor more than 24 
        months;
            (2) require that the assisted dwelling unit may be rented 
        only pursuant to a lease that complies with the requirements of 
        section 324;
            (3) comply with the requirements of section 325 (relating 
        to termination of tenancy);
            (4) require the owner to maintain the dwelling unit in 
        accordance with the applicable standards under section 
        328(a)(2); and
            (5) provide that the screening and selection of eligible 
        families for assisted dwelling units shall be the function of 
        the owner.

SEC. 352. AMOUNT OF MONTHLY ASSISTANCE PAYMENT.

    The amount of the monthly assistance payment for housing assistance 
under this title on behalf of an assisted family shall be as follows:
            (1) Units having gross rent less than payment standard.--In 
        the case of a dwelling unit bearing a gross rent that does not 
        exceed the payment standard established under section 353 for a 
        dwelling unit of the applicable size and located in the market 
        area in which such assisted dwelling unit is located, the 
        amount by which the gross rent for the dwelling unit exceeds 
        the amount of the resident contribution determined in 
        accordance with section 322.
            (2) Units having gross rent exceeding payment standard.--In 
        the case of a dwelling unit bearing a gross rent that exceeds 
        the payment standard established under section 353 for a 
        dwelling unit of the applicable size and located in the market 
        area in which such assisted dwelling unit is located, the 
        amount by which such payment standard exceeds the amount of the 
        resident contribution determined in accordance with section 
        322.

SEC. 353. PAYMENT STANDARDS.

    (a) Establishment.--Each local housing and management authority 
providing housing assistance under this title shall establish payment 
standards under this section for various areas, and sizes and types of 
dwelling units, for use in determining the amount of monthly housing 
assistance payment to be provided on behalf of assisted families.
    (b) Use of Rental Indicators.--The payment standards for each 
market area and size and type of housing shall be based on rental 
indicators established under section 323 for such area, size, and type.

SEC. 354. REASONABLE RENTS.

    (a) Establishment.--The rent charged for a dwelling unit for which 
rental assistance is provided under this title shall be established 
pursuant to negotiation and agreement between the assisted family and 
the owner of the dwelling unit.
    (b) Reasonableness.--
            (1) Determination.--A local housing and management 
        authority providing rental assistance under this title for a 
        dwelling unit shall, before commencing assistance payments for 
        a unit, determine whether the rent charged for the unit exceeds 
        the rents charged for comparable units in the applicable 
        private unassisted market.
            (2) Unreasonable rents.--If the authority determines that 
        the rent charged for a dwelling unit exceeds such comparable 
        rents, the authority--
                    (A) shall inform the assisted family renting the 
                unit that such rent exceeds the rents for comparable 
                unassisted units in the market; and
                    (B) may refuse to provide housing assistance 
                payments for such unit.

SEC. 355. PROHIBITION OF ASSISTANCE FOR VACANT RENTAL UNITS.

    If an assisted family vacates a dwelling unit for which rental 
assistance is provided under a housing assistance payments contract 
before the expiration of the term of the lease for the unit, rental 
assistance pursuant to such contract may not be provided for the unit 
after the month during which the unit was vacated.

SEC. 356. PROHIBITION OF PORTABILITY.

    If an assisted family moves outside of the jurisdiction of the 
local housing and management authority providing the housing assistance 
for the family, the authority may not provide assistance for the new 
dwelling unit of the family.

            Subtitle D--General and Miscellaneous Provisions

SEC. 371. DEFINITIONS.

    For purposes of this title:
            (1) Assisted dwelling unit.--The term ``assisted dwelling 
        unit'' means a dwelling unit in which an assisted family 
        resides and for which housing assistance payments are made 
        under this title.
            (2) Assisted family.--The term ``assisted family'' means an 
        eligible family on whose behalf housing assistance payments are 
        made under this title or who has been selected and approved for 
        housing assistance.
            (3) Choice-based.--The term ``choice-based'' means, with 
        respect to housing assistance, that the assistance is not 
        attached to a dwelling unit but can be used for any eligible 
        dwelling unit selected by the eligible family.
            (4) Eligible dwelling unit.--The term ``eligible dwelling 
        unit'' means a dwelling unit that complies with the 
        requirements under section 328 for consideration as an eligible 
        dwelling unit.
            (5) Eligible family.--The term ``eligible family'' means a 
        family that meets the requirements under section 321(a) for 
        assistance under this title.
            (6) Grant agreement.--The term ``grant agreement'' means an 
        agreement under section 302 between the Secretary and a local 
        housing and management authority for the Secretary to provide 
        grant amounts for housing assistance under this title.
            (7) Homeownership assistance.--The term ``homeownership 
        assistance'' means housing assistance provided under section 
        329 for the ownership of a dwelling unit.
            (8) Housing assistance.--The term ``housing assistance'' 
        means assistance provided under this title on behalf of low-
        income families for the rental or ownership of an eligible 
        dwelling unit.
            (9) Housing assistance payments contract.--The term 
        ``housing assistance payments contract'' means a contract under 
        section 351 between a local housing and management authority 
        (or the Secretary) and an owner to make housing assistance 
        payments under this title to the owner on behalf of an assisted 
        family.
            (10) Local housing and management authority.--The terms 
        ``local housing and management authority'' and ``authority'' 
        have the meaning given such terms in section 103, except that 
        the terms include--
                    (A) a consortia of local housing and management 
                authorities that the Secretary determines has the 
                capacity and capability to administer a program for 
                housing assistance under this title in an efficient 
                manner;
                    (B) any other entity that, upon the date of the 
                enactment of this Act, was administering any program 
                for tenant-based rental assistance under section 8 of 
                the United States Housing Act of 1937 (as in effect 
                before the enactment of this Act); and
                    (C) with respect to any area in which no local 
                housing and management authority has been organized or 
                where the Secretary determines that a local housing and 
                management authority is unwilling or unable to 
                implement this title, or is not performing 
                effectively--
                            (i) the Secretary or another entity that by 
                        contract agrees to receive grant amounts under 
                        this title and enter into housing assistance 
                        payments contracts with owners and perform the 
                        other functions of local housing and management 
                        authority under this title; or
                            (ii) notwithstanding any provision of State 
                        or local law, a local housing and management 
                        authority for another area that contracts with 
                        the Secretary to administer a program for 
                        housing assistance under this title, without 
                        regard to any otherwise applicable limitations 
                        on its area of operation.
            (11) Owner.--The term ``owner'' means the person or entity 
        having the legal right to lease or sublease dwelling units. 
        Such term includes any principals, general partners, primary 
        shareholders, and other similar participants in any entity 
        owning a multifamily housing project, as well as the entity 
        itself.
            (12) Rent.--The terms ``rent'' and ``rental'' include, with 
        respect to members of a cooperative, the charges under the 
        occupancy agreements between such members and the cooperative.
            (13) Rental assistance.--The term ``rental assistance'' 
        means housing assistance provided under this title for the 
        rental of a dwelling unit.

SEC. 372. RENTAL ASSISTANCE FRAUD RECOVERIES.

    (a) Authority to Retain Recovered Amounts.--The Secretary shall 
permit local housing and management authorities administering housing 
assistance under this title to retain, out of amounts obtained by the 
authorities from tenants that are due as a result of fraud and abuse, 
an amount (determined in accordance with regulations issued by the 
Secretary) equal to the greater of--
            (1) 50 percent of the amount actually collected; or
            (2) the actual, reasonable, and necessary expenses related 
        to the collection, including costs of investigation, legal 
        fees, and collection agency fees.
    (b) Use.--Amounts retained by an authority shall be made available 
for use in support of the affected program or project, in accordance 
with regulations issued by the Secretary. If the Secretary is the 
principal party initiating or sustaining an action to recover amounts 
from families or owners, the provisions of this section shall not 
apply.
    (c) Recovery.--Amounts may be recovered under this section--
            (1) by an authority through a lawsuit (including settlement 
        of the lawsuit) brought by the authority or through court-
        ordered restitution pursuant to a criminal proceeding resulting 
        from an authority's investigation where the authority seeks 
        prosecution of a family or where an authority seeks prosecution 
        of an owner;
            (2) through administrative repayment agreements with a 
        family or owner entered into as a result of an administrative 
        grievance procedure conducted by an impartial decisionmaker in 
        accordance with section 330; or
            (3) through an agreement between the parties.

   Subtitle E--Provisions Relating to Discontinued HUD-Administered 
                 Programs for Project-Based Assistance

SEC. 381. PROHIBITION OF DISCRIMINATION IN SUBSIDIZED PROJECTS.

    (a) In General.--No owner of a subsidized project shall refuse to 
lease any available dwelling unit in any such project of such owner 
that rents for an amount not greater than the applicable rental 
indicator for a comparable unit, as determined under section 305, to an 
assisted family under this title, a proximate cause of which is the 
status of such prospective tenant as an assisted family, and to enter 
into a housing assistance payments contract respecting such unit.
    (b) Definition.--For purposes of this section, the term 
``subsidized project'' has the meaning given the term in section 203(b) 
of the Housing and Community Development Amendments of 1978.

 TITLE IV--ACCREDITATION AND OVERSIGHT OF LOCAL HOUSING AND MANAGEMENT 
                              AUTHORITIES

         Subtitle A--Housing Foundation and Accreditation Board

SEC. 401. ESTABLISHMENT.

    There is established an independent agency in the executive branch 
of the Government to be known as the Housing Foundation and 
Accreditation Board (in this title referred to as the ``Board'').

SEC. 402. MEMBERSHIP.

    (a) In General.--The Board shall be composed of 12 members 
appointed by the President not later than 180 days after the date of 
the enactment of this Act, as follows:
            (1) 4 members shall be appointed from among 10 individuals 
        recommended by the Secretary of Housing and Urban Development.
            (2) 4 members shall be appointed from among 10 individuals 
        recommended by the Chairman and Ranking Minority Member of the 
        Committee on Banking, Housing, and Urban Affairs of the Senate.
            (3) 4 members appointed from among 10 individuals 
        recommended by the Chairman and Ranking Minority Member of the 
        Committee on Banking and Financial Services of the House of 
        Representatives.
    (b) Qualifications.--
            (1) Required representation.--The Board shall at all times 
        have the following members:
                    (A) 2 members who are residents of public housing 
                or dwelling units assisted under title III of this Act 
                or the provisions of section 8 of the United States 
                Housing Act of 1937 (as in effect before the enactment 
                of this Act).
                    (B) 2 members who are executive directors of local 
                housing and management authorities.
                    (C) 1 member who is a member of the Institute of 
                Real Estate Managers.
                    (D) 1 member who is the owner of a multifamily 
                housing project assisted under a program administered 
                by the Secretary of Housing and Urban Development.
            (2) Required experience.--The Board shall at all times have 
        as members individuals with the following experience:
                    (A) At least 1 individual who has extensive 
                experience in the residential real estate finance 
                business.
                    (B) At least 1 individual who has extensive 
                experience in operating a nonprofit organization that 
                provides affordable housing.
                    (C) At least 1 individual who has extensive 
                experience in construction of multifamily housing.
                    (D) At least 1 individual who has extensive 
                experience in the management of a community development 
                corporation.
        A single member of the board with the appropriate experience 
        may satisfy the requirements of more than 1 subparagraph of 
        this paragraph. A single member of the board with the 
        appropriate qualifications and experience may satisfy the 
        requirements of a subparagraph of paragraph (1) and a 
        subparagraph of this paragraph.
    (c) Political Affiliation.--Not more than 6 members of the Board 
may be of the same political party.
    (d) Terms.--
            (1) In general.--Each member of the Board shall be 
        appointed for a term of 4 years, except as provided in 
        paragraphs (2) and (3).
            (2) Terms of initial appointees.--As designated by the 
        President at the time of appointment, of the members first 
        appointed--
                    (A) 3 shall be appointed for terms of 1 year;
                    (B) 3 shall be appointed for terms of 2 years;
                    (C) 3 shall be appointed for terms of 3 years; and
                    (D) 3 shall be appointed for terms of 4 years;
            (3) Vacancies.--Any member appointed to fill a vacancy 
        occurring before the expiration of the term for which the 
        member's predecessor was appointed shall be appointed only for 
        the remainder of that term. A member may serve after the 
        expiration of that member's term until a successor has taken 
        office. A vacancy in the Board shall be filled in the manner in 
        which the original appointment was made.
    (e) Chairperson.--The Board shall elect a chairperson from among 
members of the Board.
    (f) Quorum.--A majority of the members of the Board shall 
constitute a quorum for the transaction of business.
    (g) Voting.--Each member of the Board shall be entitled to 1 vote, 
which shall be equal to the vote of every other member of the Board.
    (h) Prohibition on Additional Pay.--Members of the Board shall 
serve without compensation, but shall be reimbursed for travel, 
subsistence, and other necessary expenses incurred in the performance 
of their duties as members of the Board.

SEC. 403. FUNCTIONS.

    The purpose of this subtitle is to establish the Board as a 
nonpolitical entity to carry out the following functions:
            (1) Evaluation of deep subsidy programs.--Measuring the 
        performance and efficiency of all ``deep subsidy'' programs for 
        housing assistance administered by the Secretary of Housing and 
        Urban Development, including the public housing program under 
        title II and the programs for tenant- and project-based rental 
        assistance under title III and section 8 of the United States 
        Housing Act of 1937 (as in effect before the enactment of this 
        Act).
            (2) Establishment of lhma performance benchmarks.--
        Establishing standards and guidelines under section 431 for use 
        by the Secretary in measuring the performance and efficiency of 
        local housing and management authorities and other owners and 
        providers of federally assisted housing in carrying out 
        operational and financial functions.
            (3) Establishment of financial and performance audit 
        requirements.--Establishing standards, requirements, and 
        procedures for performance and evaluation audits under section 
        432 and independent auditors conducting such audits.
            (4) Accreditation of lhma's.--Establishing a procedure 
        under section 431(b) for accrediting local housing and 
        management authorities to receive block grants under title I 
        for the operation, maintenance, and production of public 
        housing, ensuring that financial and performance audits under 
        such section are conducted annually for each local housing and 
        management authority, and reviewing such audits for purposes of 
        accreditation.
            (5) Information and technical assistance.--Providing 
        information, continuing educational opportunities, and 
        technical assistance to public and private housing providers.
            (6) Establishment of system for identifying lhma 
        dysfunctions.--Establishing a system for identifying potential 
        problems in the operations and financial functions of local 
        housing and management authorities at a time before such 
        problems result in serious and complicated deficiencies.
            (7) Establishment of systems.--Establishing and making 
        available to local housing and management authorities and other 
        housing providers efficient systems to assist in managing 
        housing, including computer systems for financial, occupancy, 
        and other functions that facilitate audits, reviews, and 
        evaluations under this Act and model practices and procedures 
        to ensure compliance with the requirements of section 231(a).
            (8) Other activities.--Carrying out such other functions as 
        may otherwise be provided under law.

SEC. 404. INITIAL ESTABLISHMENT OF STANDARDS AND PROCEDURES FOR LHMA 
              COMPLIANCE.

    (a) Deadline.--The Board shall establish the standards, guidelines, 
and procedures under sections 431 and 432 not later than the expiration 
of the 12-month period beginning upon the completion of the 
appointment, under section 402, of the initial members of the Board. 
Before issuing such standards, guidelines, and procedures in final 
form, the Board shall submit a copy to the Congress.
    (b) Priority of Initial Evaluations.--After organization of the 
Board and establishment of standards, guidelines, and procedures under 
sections 431 and 432, the Board shall commence evaluations under 
section 434(b) for the purpose of accrediting local housing and 
management authorities and shall give priority to conducting 
evaluations of local housing and management authorities that are 
designated as troubled public housing agencies under section 6(j) of 
the United States Housing Act of 1937 (as in effect before the date of 
the enactment of this Act) pursuant to section 431(d).

SEC. 405. POWERS.

    (a) Hearings.--The Board may, for the purpose of carrying out this 
subtitle, hold such hearings and sit and act at such times and places 
as the Board determines appropriate.
    (b) Rules and Regulations.--The Board may adopt such rules and 
regulations as may be necessary to establish its procedures and to 
govern the manner of its operations, organization, and personnel.
    (c) Assistance From Federal Agencies.--
            (1) Information.--The Board may secure directly from any 
        department or agency of the Federal Government such information 
        as the Board may require for carrying out its functions, 
        including community improvement plans submitted to the 
        Secretary by local housing and management authorities under 
        title II. Upon request of the Board, any such department or 
        agency shall furnish such information. The Board may acquire 
        information directly from local housing and management 
        authorities to the same extent the Secretary may acquire such 
        information.
            (2) General services administration.--The Administrator of 
        General Services shall provide to the Board, on a reimbursable 
        basis, such administrative support services as the Board may 
        request.
            (3) Department of housing and urban development.--Upon the 
        request of the chairperson of the Board, the Secretary of 
        Housing and Urban Development shall, to the extent possible and 
        subject to the discretion of the Secretary, detail any of the 
        personnel of the Department of Housing and Urban Development, 
        on a nonreimbursable basis, to assist the Board in carrying out 
        its functions under this subtitle.
    (d) Mails.--The Board may use the United States mails in the same 
manner and under the same conditions as other Federal agencies.
    (e) Contracting.--The Board may, to such extent and in such amounts 
as are provided in appropriations Acts, enter into contracts with 
private firms, institutions, and individuals for the purpose of 
conducting research or surveys necessary to enable the Board to 
discharge its functions under this subtitle.
    (f) Staff.--
            (1) Executive director.--The Board shall appoint an 
        executive director of the Board, who shall be compensated at a 
        rate fixed by the Board, but which shall not exceed the rate 
        established for level V of the Executive Schedule under title 
        5, United States Code.
            (2) Other personnel.--In addition to the executive 
        director, the Board may appoint and fix the compensation of 
        such personnel as the Board considers necessary, in accordance 
        with the provisions of title 5, United States Code, governing 
        appointments to the competitive service, and the provisions of 
        chapter 51 and subchapter III of chapter 53 of such title, 
        relating to classification and General Schedule pay rates. Such 
        personnel may include personnel for assessment teams under 
        section 431(b).

SEC. 406. FEES.

    (a) Accreditation Fees.--The Board may establish and charge fees 
for the accreditation of local housing and management authorities as 
the Board considers necessary to cover the costs of the operations of 
the Board relating to establishing standards, guidelines, and 
procedures for evaluating the performance of local housing and 
management authorities and performing comprehensive reviews relating to 
the accreditation of such authorities.
    (b) Technical Assistance Fees.--The Board may establish and charges 
fees for providing information, technical assistance, and other 
products, including information and systems provided under paragraphs 
(5) and (7) of section 403, as the Board considers appropriate to cover 
the costs of such activities.
    (c) Fund.--Any fees collected under this section shall be deposited 
in an operations fund for the Board, which is hereby established in the 
Treasury of the United States. Amounts in such fund shall be available, 
to the extent provided in appropriation Acts, for the expenses of the 
Board in carrying out its functions under this subtitle.

SEC. 407. REPORTS.

    The Board shall submit a report to the Congress annually 
describing, for the year for which the report is made--
            (1) any modifications made by the Board to the standards, 
        guidelines, and procedures issued under section 431 and 432 by 
        the Board;
            (2) the results of the assessments, reviews, and 
        evaluations conducted by the Board under subtitle B;
            (3) the types and extent of assistance, information, and 
        products provided by the Board; and
            (4) any other activities of the Board.

    Subtitle B--Accreditation and Oversight Standards and Procedures

SEC. 431. ESTABLISHMENT OF PERFORMANCE BENCHMARKS AND ACCREDITATION 
              PROCEDURES.

    (a) Performance Benchmarks.--
            (1) Performance areas.--The Housing Foundation and 
        Accreditation Board established under section 401 (in this 
        subtitle referred to as the ``Board'') shall establish 
        standards and guidelines, for use under section 433 by the 
        Secretary, to measure the performance of local housing and 
        management authorities in all aspects relating to--
                    (A) operational and financial functions;
                    (B) providing, maintaining, and assisting low-
                income housing--
                            (i) that is safe, clean, and healthy, as 
                        required under sections 233 and 328;
                            (ii) in a manner consistent with the 
                        comprehensive housing affordability strategy 
                        under section 105 of the Cranston-Gonzalez 
                        National Affordable Housing Act;
                            (iii) that is occupied by eligible 
                        families; and
                            (iv) that is affordable to eligible 
                        families;
                    (C) producing low-income housing and executing 
                capital projects, if applicable;
                    (D) administering the provision of housing 
                assistance under title III;
                    (E) accomplishing the goals and plans set forth in 
                the community improvement plan for the authority;
                    (F) promoting responsibility and self-sufficiency 
                among residents of public housing developments of the 
                authority and assisted families under title III; and
                    (G) complying with the other requirements of the 
                authority under block grant contracts under title II, 
                grant agreements under title III, and the provisions of 
                this Act.
            (2) Performance categories.--In establishing standards and 
        guidelines under this section, the Board shall define various 
        levels of performance, which shall include the following 
        levels:
                    (A) Exceptionally well-managed.--A minimum 
                acceptable level of performance in the areas specified 
                in paragraph (1) for classification of a local housing 
                and management authority as exceptionally well-managed, 
                which shall indicate that the authority functions 
                exceptionally.
                    (B) Well-managed.--A minimum acceptable level of 
                performance in the areas specified in paragraph (1) for 
                classification of a local housing and management 
                authority as well-managed, which shall indicate that 
                the authority functions satisfactorily.
                    (C) Troubled.--A minimum level of performance in 
                the areas specified in paragraph (1) for classification 
                of a local housing and management authority as a 
                troubled authority, which shall indicate that the 
                authority functions unsatisfactorily with respect to 
                certain areas under paragraph (1), but such 
                deficiencies are not irreparable.
                    (D) Dysfunctional.--A maximum level of performance 
                in the areas specified in paragraph (1) for 
                classification of a local housing and management 
                authority as dysfunctional, which shall indicate that 
                the authority suffers such deficiencies that the 
                authority should not be allowed to continue to manage 
                low-income housing or administer housing assistance.
            (3) Accreditation standard.--In establishing standards and 
        guidelines under this section, the Board shall establish a 
        minimum acceptable level of performance for accrediting a local 
        housing and management authority for purposes of authorizing 
        the authority to enter into a new block grant contract under 
        title II or a new grant agreement under title III.
    (b) Accreditation Procedure.--The Accreditation Board shall 
establish procedures for--
            (1) reviewing the performance of a local housing and 
        management authority over the term of the expiring 
        accreditation, which review shall be conducted during the 12-
        month period that ends upon the conclusion of the term of the 
        expiring accreditation;
            (2) evaluating the capability of a local housing and 
        management authority that proposes to enter into an initial 
        block grant contract under title II or an initial grant 
        agreement under title III; and
            (3) determining whether the authority complies with the 
        standards and guidelines for accreditation established under 
        subsection (a)(3).
The procedures for a review or evaluation under this subsection shall 
provide for the review or evaluation to be conducted by an assessment 
team established by the Board, which shall review annual financial and 
performance audits conducted under section 432 and obtain such 
information as the Board may require.
    (c) Identification of Potential Problems.--The standards and 
guidelines under subsection (a) and the procedure under subsection (b) 
shall be established in a manner designed to identify potential 
problems in the operations, management, functioning of local housing 
and management authorities at a time before such problems result in 
serious and complicated deficiencies.
    (d) Interim Applicability of PHMAP.--Notwithstanding any other 
provision of this subtitle, during the period that begins on the date 
of the enactment of this Act and ends upon the date of the 
effectiveness of final regulations establishing the standards, 
guidelines, and procedures required under this section and section 432, 
the Secretary shall assess the management performance of local housing 
and management authorities in the same manner provided for public 
housing agencies pursuant to section 6(j) of the United States Housing 
Act of 1937 (as in effect immediately before the enactment of this Act) 
and may take actions with respect to local housing and management 
authorities that are authorized under such section with respect to 
public housing agencies.

SEC. 432. ANNUAL FINANCIAL AND PERFORMANCE AUDIT.

    (a) Requirement.--The Secretary shall require each local housing 
and management authority that receives grant amounts under this Act in 
a fiscal year to have a financial and performance audit of the 
authority conducted for the fiscal year and to submit the results of 
the audit to the Secretary and the Board.
    (b) Procedures.-- The Accreditation Board shall establish the 
requirements and procedures for such audits under this section, in 
accordance with the requirements under this section. Such procedures 
shall--
            (1) provide for the audit to be conducted by an independent 
        auditor jointly selected by board and authority;
            (2) authorize the auditor and the Board to obtain 
        information from a local housing and management authority, to 
        access any books, documents, papers, and records of an 
        authority that are pertinent to this Act and assistance 
        received pursuant to this Act, and to review any reports of an 
        authority to the Secretary.
            (3) be designed to identify potential problems in the 
        operations, management, functioning of a local housing and 
        management authority at a time before such problems result in 
        serious and complicated deficiencies.
    (c) Purpose.--Audits under this section shall be designed to 
evaluate the financial performance and soundness and management 
performance of the local housing and management authority board of 
directors (or other similar governing body) and the authority 
management officials and staff, assess the compliance of an authority 
with all aspects of the standards and guidelines established under 
section 431(a)(1), and provide information sufficient for the Secretary 
to designate the authority under the categories established under 
section 431(a)(2).
    (d) Single Audit Act Compliance.--An audit under this section shall 
be made in a manner so that the audit complies with the requirements 
for audits under chapter 75 of title 31, United States Code.
    (e) Withholding of Amounts for Costs of Audit.--If the Secretary 
determines that a local housing and management authority has failed to 
take the actions required to submit an audit under this section for a 
fiscal year, the Secretary may--
            (1) arrange for, and pay the costs of, the audit; and
            (2) withhold, from the total allocation for any fiscal year 
        otherwise payable to the authority under this Act, amounts 
        sufficient to pay for the reasonable costs of conducting an 
        acceptable audit, including, if appropriate, the reasonable 
        costs of accounting services necessary to place the authority's 
        books and records in condition that permits an audit.

SEC. 433. ANNUAL CLASSIFICATION BY PERFORMANCE CATEGORY.

    The Secretary shall annually designate each local housing and 
management authority according to the performance categories under 
section 431(a)(2). In determining the classification of an authority, 
the Secretary shall consider the most recent financial and performance 
audit under section 432 of the authority and accreditation reports 
under section 434(c) of the authority, but may not undertake any audits 
and examinations of the authority.

SEC. 434. ACCREDITATION.

    (a) Review Upon Expiration of Previous Accreditation.--The 
Accreditation Board shall perform a comprehensive review of the 
performance of a local housing and management authority, in accordance 
with the procedures established under section 431(b), before the 
expiration of the term for which a previous accreditation was granted 
under this subtitle.
    (b) Initial Evaluation.--
            (1) In general.--Before entering into an initial block 
        grant contract under title II or an initial grant agreement 
        under title III with any local housing and management 
        authority, the Board shall conduct a comprehensive evaluation 
        of the capabilities of the local housing and management 
        authority.
            (2) Exception.--Paragraph (1) shall not apply to an initial 
        block grant contract or grant agreement entered into during the 
        period beginning upon the date of the enactment of this Act and 
        ending upon the date of the effectiveness of final regulations 
        establishing the standards, guidelines, and procedures required 
        under section 431 or 432 with any public housing agency that 
        received amounts under the United States Housing Act of 1937 
        during fiscal year 1995.
    (c) Determination and Report.--Pursuant to a review or evaluation 
under this section, the Board shall determine whether the authority 
meets the requirements for accreditation under section 431(a)(3), shall 
accredit the authority if it meets such requirements, and shall submit 
a report on the results of the review or evaluation and such 
determination to the Secretary and the authority.
    (d) Accreditation.--An accreditation under this section shall 
expire at the end the term established by the Board in granting the 
accreditation, which may not exceed 5 years. The Board may qualify an 
accreditation placing conditions on the accreditation based on the 
future performance of the authority.

SEC. 435. PERFORMANCE AGREEMENTS FOR TROUBLED AUTHORITIES.

    (a) In General.--Upon designating a local housing and management 
authority as a troubled authority under section 431(a)(2)(C), the 
Secretary shall seek to enter into a agreement with the authority 
providing for improving the management performance of the authority.
    (b) Contents.--An agreement under this section shall set forth--
            (1) targets for improving performance, as measured by the 
        guidelines and standards established under section 431(a)(1) 
        and other requirements within a specified period of time, which 
        shall include targets to be met upon the expiration of the 12-
        month period beginning upon entering into the agreement;
            (2) strategies for meeting such targets;
            (3) sanctions for failure to implement such strategies; and
            (4) to the extent the Secretary deems appropriate, a plan 
        for enhancing resident involvement in the management of the 
        local housing and management authority.
    (c) Local Assistance in Implementation.--The Secretary and the 
local housing and management authority shall, to the maximum extent 
practicable, seek the assistance of local public and private entities 
in carrying out an agreement under this section.
    (d) Default Under Performance Agreement.--Upon the expiration of 
the 12-month period beginning upon entering into an agreement under 
this section with a local housing and management authority, the 
Secretary shall review the performance of the authority in relation to 
the performance targets and strategies under the agreement. If the 
Secretary determines that the authority has failed to comply with the 
performance targets established for the expiration of such period, the 
Secretary--
            (1) shall take the action authorized under section 
        437(b)(2); and
            (2) may withhold, from any metropolitan city or urban 
        county (as such terms are defined in section 102 of the Housing 
        and Community Development Act of 1974) within which any portion 
        of the jurisdiction of the authority is located, any amounts 
        allocated for such city or county under section 106 of such 
        Act.

SEC. 436. OPTION TO DEMAND CONVEYANCE OF TITLE TO OR POSSESSION OF 
              PUBLIC HOUSING.

    (a) Authority for Conveyance.--A contract under section 201 for 
block grants under title II (including contracts which amend or 
supersede contracts previously made (including contracts for 
contributions)) may provide that upon the occurrence of a substantial 
default with respect to the covenants or conditions to which the local 
housing and management authority is subject (as such substantial 
default shall be defined in such contract) or upon designation of the 
authority as dysfunctional pursuant to section 431(a)(2)(D), the local 
housing and management authority shall be obligated, at the option of 
the Secretary, to--
            (1) convey title in any case where, in the determination of 
        the Secretary (which determination shall be final and 
        conclusive), such conveyance of title is necessary to achieve 
        the purposes of this Act; or
            (2) deliver to the Secretary possession of the development, 
        as then constituted, to which such contract relates.
    (b) Obligation to Reconvey.--Any block grant contract under title 
II containing the provisions authorized in subsection (a) shall also 
provide that the Secretary shall be obligated to reconvey or redeliver 
possession of the development, as constituted at the time of 
reconveyance or redelivery, to such local housing and management 
authority or to its successor (if such local housing and management 
authority or a successor exists) upon such terms as shall be prescribed 
in such contract, and as soon as practicable after--
            (1) the Secretary is satisfied that all defaults with 
        respect to the development have been cured, and that the 
        development will, in order to fulfill the purposes of this Act, 
        thereafter be operated in accordance with the terms of such 
        contract; or
            (2) the termination of the obligation to make annual block 
        grants to the authority, unless there are any obligations or 
        covenants of the authority to the Secretary which are then in 
        default.
Any prior conveyances and reconveyances or deliveries and redeliveries 
of possession shall not exhaust the right to require a conveyance or 
delivery of possession of the development to the Secretary pursuant to 
subsection (a) upon the subsequent occurrence of a substantial default.
    (c) Continued Grants for Repayment of Bonds and Notes Under 1937 
Act.--If--
            (1) a contract for block grants under title II for an 
        authority includes provisions that expressly state that the 
        provisions are included pursuant to this subsection, and
            (2) the portion of the block grant payable for debt service 
        requirements pursuant to the contract has been pledged by the 
        local housing and management authority as security for the 
        payment of the principal and interest on any of its 
        obligations, then--
                    (A) the Secretary shall (notwithstanding any other 
                provisions of this Act), continue to make the block 
                grant payments for the authority so long as any of such 
                obligations remain outstanding; and
                    (B) the Secretary may covenant in such a contract 
                that in any event such block grant amounts shall in 
                each year be at least equal to an amount which, 
                together with such income or other funds as are 
                actually available from the development for the purpose 
                at the time such block grant payments are made, will 
                suffice for the payment of all installments of 
                principal and interest on the obligations for which the 
                amounts provided for in the contract shall have been 
                pledged as security that fall due within the next 
                succeeding 12 months.
In no case shall such block grant amounts be in excess of the maximum 
sum specified in the contract involved, nor for longer than the 
remainder of the maximum period fixed by the contract.

SEC. 437. REMOVAL OF INEFFECTIVE LHMA'S.

    (a) Conditions of Removal.--The actions specified in subsection (b) 
may be taken only upon--
            (1) the occurrence of events or conditions that constitute 
        a substantial default by a local housing and management 
        authority with respect to (A) the covenants or conditions to 
        which the local housing and management authority is subject, or 
        (B) an agreement entered into under section 435;
            (2) designation of the authority as dysfunctional pursuant 
        to section 431(a)(2)(D);
            (3) in the case only of action under subsection (b)(1), 
        failure of a local housing and management authority to obtain 
        reaccreditation upon the expiration of the term of a previous 
        accreditation granted under this subtitle; or
            (4) submission to the Secretary of a petition by the 
        residents of the public housing owned or operated by a local 
        housing and management authority that is designated as troubled 
        or dysfunctional pursuant to section 431(a)(2).
    (b) Removal Actions.--Notwithstanding any other provision of law or 
of any block grant contract under title II or any grant agreement under 
title III, in accordance with subsection (a), the Secretary may--
            (1) solicit competitive proposals from other local housing 
        and management authorities and private housing management 
        agents (which, in the discretion of the Secretary, may be 
        selected by existing public housing residents through 
        administrative procedures established by the Secretary) and, if 
        appropriate, provide for such agents to manage all, or part, of 
        the housing administered by the local housing and management 
        authority or all or part of the other functions of the 
        authority;
            (2) take possession of the local housing and management 
        authority, including any developments or functions of the 
        authority under any section of this Act;
            (3) solicit competitive proposals from other local housing 
        and management authorities and private entities with experience 
        in construction management and, if appropriate, provide for 
        such authorities or firms to oversee implementation of 
        assistance made available for capital improvements for public 
        housing;
            (4) require the authority to make other arrangements 
        acceptable to the Secretary and in the best interests of the 
        public housing residents and assisted families under title III 
        for managing all, or part of, the public housing administered 
        by the authority or the functions of the authority; or
            (5) if the Secretary determines that reasonable 
        opportunities for remedy using the actions under paragraphs (1) 
        through (4) have failed or are not available, petition for the 
        appointment of a receiver for the local housing and management 
        authority to any district court of the United States or to 
any court of the State in which any portion of the jurisdiction of the 
local housing and management authority is located, that is authorized 
to appoint a receiver for the purposes and having the powers prescribed 
in this section.
    (c) Emergency Assistance.--The Secretary may make available to 
receivers and other entities selected or appointed pursuant to this 
section such assistance as is fair and reasonable to remedy the 
substantial deterioration of living conditions in individual public 
housing developments or other related emergencies that endanger the 
health, safety and welfare of public housing residents or assisted 
families under title III.
    (d) Powers of Secretary.--If the Secretary takes possession of an 
authority, or any developments or functions of an authority, pursuant 
to subsection (b)(2), the Secretary--
            (1) may abrogate contracts that substantially impede 
        correction of the substantial default or improvement of the 
        classification;
            (2) may demolish and dispose of assets of the authority in 
        accordance with subtitle E;
            (3) where determined appropriate by the Secretary, may 
        require the establishment of one or more new local housing and 
        management authorities;
            (4) may consolidate the authority into other well-managed 
        local housing and management authorities with the consent of 
        such well-managed authorities;
            (5) shall not be subject to any State or local laws that, 
        in the determination of the receiver, substantially impede 
        correction of the substantial default or improvement of the 
        classification; and
            (6) shall have such additional authority as a district 
        court of the United States has the authority to confer under 
        like circumstances upon a receiver to achieve the purposes of 
        the receivership.
The Secretary may appoint, on a competitive or noncompetitive basis, an 
individual or entity as an administrative receiver to assume the 
Secretary's responsibility under this paragraph for the administration 
of a local housing and management authority. The Secretary may delegate 
to the administrative receiver any or all of the powers of the 
Secretary under this subsection. Regardless of any delegation under 
this subsection, an administrative receiver may not require the 
establishment of one or more new local housing and management 
authorities pursuant to paragraph (3) unless the Secretary first 
approves such establishment. For purposes of this subsection, the term 
``local housing and management authority'' includes any developments or 
functions of a local housing and management authority under any section 
of this title.
    (e) Receivership.--
            (1) Required appointment.--In any proceeding under 
        subsection (b)(5), upon a determination that a substantial 
        default has occurred, and without regard to the availability of 
        alternative remedies, the court shall appoint a receiver to 
        conduct the affairs of the local housing and management 
        authority in a manner consistent with this Act and in 
        accordance with such further terms and conditions as the court 
        may provide. The receiver appointed may be another local 
        housing and management authority, a private management 
        corporation, the Secretary, or any other appropriate entity. 
        The court shall have power to grant appropriate temporary or 
        preliminary relief pending final disposition of the petition by 
        the Secretary.
            (2) Powers of receiver.--If a receiver is appointed for a 
        local housing and management authority pursuant to subsection 
        (b)(5), in addition to the powers accorded by the court 
        appointing the receiver, the receiver--
                    (A) may abrogate contracts that substantially 
                impede correction of the substantial default or 
                improvement of the classification;
                    (B) may demolish and dispose of assets of the 
                authority in accordance with subtitle E;
                    (C) where determined appropriate by the Secretary, 
                may require the establishment of one or more new local 
                housing and management authorities, to the extent 
                permitted by State and local law; and
                    (D except as provided in subparagraph (C), shall 
                not be subject to any State or local laws that, in the 
                determination of the receiver, substantially impede 
                correction of the substantial default or improvement of 
                the classification.
        For purposes of this paragraph, the term ``local housing and 
        management authority'' includes any developments or functions 
        of a local housing and management authority under any section 
        of this title.
            (3) Termination.--The appointment of a receiver pursuant to 
        this subsection may be terminated, upon the petition of any 
        party, when the court determines that all defaults have been 
        cured or the local housing and management authority will be 
        able to make the same amount of progress in correcting the 
        management of the housing as the receiver.
    (f) Liability.--If the Secretary takes possession of an authority 
pursuant to subsection (b)(2) or a receiver is appointed pursuant to 
subsection (b)(5) for a local housing and management authority, the 
Secretary or the receiver shall be deemed to be acting in the capacity 
of the local housing and management authority (and not in the official 
capacity as Secretary or other official) and any liability incurred 
shall be a liability of the local housing and management authority.

SEC. 438. MANDATORY TAKEOVER OF CHRONICALLY TROUBLED PHA'S.

    (a) Removal of Agency.--Notwithstanding any other provision of this 
Act, not later than the expiration of the 180-day period beginning on 
the date of the enactment of this Act, the Secretary shall take one of 
the following actions with respect to each chronically troubled public 
housing agency:
            (1) Contracting for management.--Solicit competitive 
        proposals for the management of the agency pursuant to section 
        437(b)(1) and replace the management of the agency pursuant to 
        selection of such a proposal.
            (2) Takeover.--Take possession of the agency pursuant to 
        section 437(b)(2) of such Act.
    (b) Definition.--For purposes of this section, the term 
``chronically troubled public housing agency'' means a public housing 
agency that, as of the date of the enactment of this Act, is designated 
under section 6(j)(2) of the United States Housing Act of 1937 (as in 
effect immediately before the enactment of this Act) as a troubled 
public housing agency and has been so designated continuously for the 
3-year period ending upon such date of enactment; except that such term 
does not include any agency that owns or operates less than 1250 public 
housing dwelling units and that the Secretary determines can, with a 
reasonable amount of effort, make such improvements or remedies as may 
be necessary to remove its designation as troubled within 12 months.

SEC. 439. TREATMENT OF TROUBLED PHA'S.

    (a) Effect of Troubled Status on CHAS.--The comprehensive housing 
affordability strategy for the first year beginning after the date of 
the enactment of this Act for the State or unit of general local 
government in which any troubled public housing agency is located shall 
not be considered to comply with the requirements under section 105 of 
the Cranston-Gonzalez National Affordable Housing Act unless such plan 
includes a description of the manner in which the State or unit will 
assist such troubled agency in improving its operations to remove such 
designation.
    (b) Definition.--For purposes of this section, the term ``troubled 
public housing agency'' means a public housing agency that--
            (1) upon the date of the enactment of this Act, is 
        designated under section 6(j)(2) of the United States Housing 
        Act of 1937 (as in effect immediately before the enactment of 
        this Act) as a troubled public housing agency; and
            (2) is not a chronically troubled public housing agency, as 
        such term is defined in section 438(b) of this Act.

SEC. 438. MAINTENANCE OF AND ACCESS TO RECORDS.

    (a) Keeping of Records.--Each local housing and management 
authority shall keep such records as may be reasonably necessary to 
disclose the amount and the disposition by the authority of the 
proceeds of assistance received pursuant to this Act and to ensure 
compliance with the requirements of this Act.
    (b) Access to Documents.--The Secretary, the Inspector General for 
the Department of Housing and Urban Development, and the Comptroller 
General of the United States shall each have access for the purpose of 
audit and examination to any books, documents, papers, and records of a 
local housing and management authority that are pertinent to this Act 
and assistance received pursuant to this Act.

SEC. 440. ANNUAL REPORTS REGARDING TROUBLED LHMA'S.

    The Secretary shall submit a report to the Congress annually, as a 
part of the report of the Secretary under section 8 of the Department 
of Housing and Urban Development Act, that--
            (1) identifies the local housing and management authorities 
        that are designated as troubled or dysfunctional under section 
        431(a)(2) and the reasons for such designation;
            (2) identifies the local housing and management authorities 
        that have lost accreditation pursuant to section 432; and
            (3) describes any actions that have been taken in 
        accordance with sections 433, 434, and 435.

SEC. 442. APPLICABILITY TO RESIDENT MANAGEMENT CORPORATIONS.

    The Secretary shall apply the provisions of this subtitle to 
resident management corporations in the same manner as applied to local 
housing and management authorities.

SEC. 443. INAPPLICABILITY TO INDIAN HOUSING.

    The provisions of sections 431, 432, 433, 434, 435, 437, and 441 
shall not apply to public housing developed or operated pursuant to a 
contract between the Secretary and an Indian housing authority.

               TITLE V--REPEALS AND CONFORMING AMENDMENTS

SEC. 501. REPEALS.

    (a) In General.--The following provisions of law are hereby 
repealed:
            (1) United states housing act of 1937.--The United States 
        Housing Act of 1937 (42 U.S.C. 1437 et seq.).
            (2) Assisted housing allocation.--Section 213 of the 
        Housing and Community Development Act of 1974 (42 U.S.C. 1439).
            (3) Public housing rent waivers for police.--Section 519 of 
        the Cranston-Gonzalez National Affordable Housing Act (42 
        U.S.C. 1437a-1).
            (4) Occupancy preferences and income mix for new 
        construction and substantial rehabilitation projects.--
        Subsection (c) of section 545, and section 555, of the 
        Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 
        1437f note).
            (5) Retroactive payment for annual adjustment factors.--
        Section 801 of the Department of Housing and Urban Development 
        Reform Act of 1989 42 U.S.C. 1437f note).
            (6) Excessive rent burden data.--Subsection (b) of section 
        550 of the Cranston-Gonzalez National Affordable Housing Act 
        (42 U.S.C. 1437f note).
            (7) Section 8 disaster relief.--Sections 931 and 932 of the 
        Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 
        1737c note).
            (8) Moving to opportunity for fair housing.--Section 152 of 
        the Housing and Community Development Act of 1992 (42 U.S.C. 
        1437f note).
            (9) Report regarding fair housing objectives.--Section 153 
        of the Cranston-Gonzalez National Affordable Housing Act (42 
        U.S.C. 1437f note).
            (10) Section 8 community investment demonstration.--Section 
        6 of the HUD Demonstration Act of 1993 (42 U.S.C. 1437f note).
            (11) Special projects for elderly or handicapped 
        families.--Section 209 of the Housing and Community Development 
        Act of 1974 (42 U.S.C. 1438).
            (12) Access to pha books.--Section 816 of the Housing Act 
        of 1954 (42 U.S.C. 1435).
            (13) Miscellaneous provisions.--Subsections (b)(1), (c), 
        and (d) of section 326 of the Housing and Community Development 
        Amendments of 1981 (Public Law 97-35, 95 Stat. 406; 42 U.S.C. 
        1437f note).
            (14) Payment for development managers.--Section 329A of the 
        Housing and Community Development Amendments of 1981 (42 U.S.C. 
        1437j-1).
            (15) Purchase of pha obligations.--Section 329E of the 
        Housing and Community Development Amendments of 1981 (12 U.S.C. 
        2294a).
            (16) Procurement of insurance by pha's.--
                    (A) In the item relating to ``administrative 
                provisions'' under the heading ``Management and 
                Administration'' in title II of the Departments of 
                Veterans Affairs and Housing and Urban Development, and 
                Independent Agencies Appropriations Act, 1991, the 
                penultimate undesignated paragraph of such item (Public 
                Law 101-507; 104 Stat. 1369).
                    (B) In the item relating to ``administrative 
                provisions'' under the heading ``Management and 
                Administration'' in title II of the Departments of 
                Veterans Affairs and Housing and Urban Development, and 
                Independent Agencies Appropriations Act, 1992, the 19th 
                through 23d undesignated paragraphs of such item 
                (Public Law 102-139; 105 Stat. 758).
            (17) Public housing childhood development.--Section 222 of 
        the Housing and Urban-Rural Recovery Act of 1983 (12 U.S.C. 
        1701z-6 note).
            (18) Indian housing childhood development.--Section 518 of 
        the Cranston-Gonzalez National Affordable Housing Act (12 
        U.S.C. 1701z-6 note).
            (19) Public housing comprehensive transition 
        demonstration.--Section 126 of the Housing and Community 
        Development Act of 1987 (42 U.S.C. 1437f note).
            (20) Public housing one-stop perinatal services 
        demonstration.--Section 521 of the Cranston-Gonzalez National 
        Affordable Housing Act (42 U.S.C. 1437t note).
            (21) Public housing mincs demonstration.--Section 522 of 
        the Cranston-Gonzalez National Affordable Housing Act (42 
        U.S.C. 1437f note).
            (22) Public housing energy efficiency demonstration.--
        Section 523 of the Cranston-Gonzalez National Affordable 
        Housing Act (42 U.S.C. 1437g note).
            (23) Omaha homeownership demonstration.--Section 132 of the 
        Housing and Community Development Act of 1992 (Public Law 102-
        550; 106 stat. 3712).
            (24) Public and assisted housing youth sports programs.--
        Section 520 of the Cranston-Gonzalez National Affordable 
        Housing Act (42 U.S.C. 11903a).
            (25) Public and assisted housing drug elimination.--The 
        Public and Assisted Housing Drug Elimination Act of 1990 (42 
        U.S.C. 11901 note).
    (b) Savings Provision.--Except as otherwise specifically provided 
in this Act, any amounts appropriated to carry out the provisions 
repealed by subsection (a) that are obligated before the date of the 
enactment of this Act shall be used in the manner provided under such 
provisions (as in effect before such repeal) and under any 
requirements, agreements, and regulations pursuant to such provisions.

SEC. 502. CONFORMING PROVISIONS.

    (a) Allocation of Elderly Housing Amounts.--Section 202(l) of the 
Housing Act of 1959 (12 U.S.C. 1701q(l)) is amended by adding at the 
end the following new paragraph:
            ``(4) Consideration in allocating assistance.--Assistance 
        under this section shall be allocated in a manner that ensures 
        that the awards of the assistance are made for projects of 
        sufficient size to accommodate facilities for supportive 
        services appropriate to the needs of frail elderly 
        residents.''.
    (b) References.--Except as provided in section 271 and 501(b), any 
reference in any other Federal law, Executive order, rule, regulation, 
or delegation of authority, or any document of or pertaining to--
            (1) public housing assisted under the United States Housing 
        Act of 1937 is deemed to refer to public housing assisted under 
        title II of this Act; and
            (2) to assistance under section 8 of the United States 
        Housing Act of 1937 is deemed to refer to assistance under 
        title III of this Act.
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