[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 1260 Engrossed in Senate (ES)]

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
104th CONGRESS
  2d Session
                                S. 1260

_______________________________________________________________________

                                 AN ACT


 
 To reform and consolidate the public and assisted housing programs of 
  the United States, and to redirect primary responsibility for these 
programs from the Federal Government to States and localities, 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; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Public Housing 
Reform and Empowerment Act of 1996''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings and purposes.
Sec. 3. Definitions.
Sec. 4. Effective date.
Sec. 5. Proposed regulations; technical recommendations.
Sec. 6. Elimination of obsolete documents.
Sec. 7. Annual reports.
                   TITLE I--PUBLIC AND INDIAN HOUSING

Sec. 101. Declaration of policy.
Sec. 102. Membership on board of directors.
Sec. 103. Authority of public housing agencies.
Sec. 104. Definitions.
Sec. 105. Contributions for lower income housing projects.
Sec. 106. Public housing agency plan.
Sec. 107. Contract provisions and requirements.
Sec. 108. Expansion of powers.
Sec. 109. Public housing designated for the elderly and the disabled.
Sec. 110. Public housing capital and operating funds.
Sec. 111. Labor standards.
Sec. 112. Repeal of energy conservation; consortia and joint ventures.
Sec. 113. Repeal of modernization fund.
Sec. 114. Eligibility for public and assisted housing.
Sec. 115. Demolition and disposition of public housing.
Sec. 116. Repeal of family investment centers; voucher system for 
                            public housing.
Sec. 117. Repeal of family self-sufficiency; homeownership 
                            opportunities.
Sec. 118. Revitalizing severely distressed public housing.
Sec. 119. Mixed-income and mixed-ownership projects.
Sec. 120. Conversion of distressed public housing to tenant-based 
                            assistance.
Sec. 121. Public housing mortgages and security interests.
Sec. 122. Linking services to public housing residents.
Sec. 123. Applicability to Indian housing.
                 TITLE II--SECTION 8 RENTAL ASSISTANCE

Sec. 201. Merger of the certificate and voucher programs.
Sec. 202. Repeal of Federal preferences.
Sec. 203. Portability.
Sec. 204. Leasing to voucher holders.
Sec. 205. Homeownership option.
Sec. 206. Technical and conforming amendments.
Sec. 207. Implementation.
Sec. 208. Definition.
Sec. 209. Effective date.
                  TITLE III--MISCELLANEOUS PROVISIONS

Sec. 301. Public housing flexibility in the CHAS.
Sec. 302. Repeal of certain provisions.
Sec. 303. Determination of income limits.
Sec. 304. Demolition of public housing.
Sec. 305. Coordination of tax credits and section 8.
Sec. 306. Eligibility for public and assisted housing.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--The Congress finds that--
            (1) there exists throughout the Nation a need for decent, 
        safe, and affordable housing;
            (2) the inventory of public housing units owned and 
        operated by public housing agencies, an asset in which the 
        Federal Government has invested approximately $90,000,000,000, 
        has traditionally provided rental housing that is affordable to 
        low-income persons;
            (3) despite serving this critical function, the public 
        housing system is plagued by a series of problems, including 
        the concentration of very poor people in very poor 
        neighborhoods and disincentives for economic self-sufficiency;
            (4) the Federal method of overseeing every aspect of public 
        housing by detailed and complex statutes and regulations 
        aggravates the problem and places excessive administrative 
        burdens on public housing agencies;
            (5) the interests of low-income persons, and the public 
        interest, will best be served by a reformed public housing 
        program that--
                    (A) consolidates many public housing programs into 
                programs for the operation and capital needs of public 
                housing;
                    (B) streamlines program requirements;
                    (C) vests in public housing agencies that perform 
                well the maximum feasible authority, discretion, and 
                control with appropriate accountability to both public 
                housing tenants and localities; and
                    (D) rewards employment and economic self-
                sufficiency of public housing tenants;
            (6) voucher and certificate programs under section 8 of the 
        United States Housing Act of 1937 are successful for 
        approximately 80 percent of applicants, and a consolidation of 
        the voucher and certificate programs into a single, market-
        driven program will assist in making section 8 tenant-based 
        assistance more successful in assisting low-income families in 
        obtaining affordable housing and will increase housing choice 
        for low-income families; and
            (7) the needs of Indian families residing on Indian 
        reservations and other Indian areas will best be served by 
        providing programs specifically designed to meet the needs of 
        Indian communities while promoting tribal self-governance and 
        self-determination.
    (b) Purposes.--The purposes of this Act are--
            (1) to consolidate the various programs and activities 
        under the public housing programs administered by the Secretary 
        in a manner designed to reduce Federal overregulation;
            (2) to redirect the responsibility for a consolidated 
        program to States, Indian tribes, localities, public housing 
        agencies, and public housing tenants;
            (3) to require Federal action to overcome problems of 
        public housing agencies with severe management deficiencies; 
        and
            (4) to consolidate and streamline tenant-based assistance 
        programs.

SEC. 3. DEFINITIONS.

    For purposes of this Act, the following definitions shall apply:
            (1) Public housing agency.--The term ``public housing 
        agency'' has the same meaning as in section 3 of the United 
        States Housing Act of 1937.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of Housing and Urban Development.

SEC. 4. EFFECTIVE DATE.

    Except as otherwise specifically provided in this Act or the 
amendments made by this Act, this Act and the amendments made by this 
Act shall become effective on the date of enactment of this Act.

SEC. 5. PROPOSED REGULATIONS; TECHNICAL RECOMMENDATIONS.

    (a) Proposed Regulations.--Not later than 9 months after the date 
of enactment of this Act, the Secretary shall submit to the Congress 
proposed regulations that the Secretary determines are necessary to 
carry out the United States Housing Act of 1937, as amended by this 
Act.
    (b) Technical Recommendations.--Not later than 9 months after the 
date of enactment of this Act, the Secretary shall submit to the 
Committee on Banking, Housing, and Urban Affairs of the Senate and the 
Committee on Banking and Financial Services of the House of 
Representatives, recommended technical and conforming legislative 
changes necessary to carry out this Act and the amendments made by this 
Act.

SEC. 6. ELIMINATION OF OBSOLETE DOCUMENTS.

    Effective 1 year after the date of enactment of this Act, no rule, 
regulation, or order (including all handbooks, notices, and related 
requirements) pertaining to public housing or section 8 tenant-based 
programs issued or promulgated under the United States Housing Act of 
1937 before the date of enactment of this Act may be enforced by the 
Secretary.

SEC. 7. ANNUAL REPORTS.

    Not later than 1 year after the date of enactment of this Act, and 
annually thereafter, the Secretary shall submit a report to the 
Congress on the impact of the amendments made by this Act on--
            (1) the demographics of public housing tenants and families 
        receiving tenant-based assistance under the United States 
        Housing Act of 1937; and
            (2) the economic viability of public housing agencies.

                   TITLE I--PUBLIC AND INDIAN HOUSING

SEC. 101. DECLARATION OF POLICY.

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

``SEC. 2. DECLARATION OF POLICY.

    ``It is the policy of the United States to promote the general 
welfare of the Nation by employing the funds and credit of the Nation, 
as provided in this title--
            ``(1) to assist States, Indian tribes, and political 
        subdivisions of States to remedy the unsafe housing conditions 
        and the acute shortage of decent and safe dwellings for low-
        income families;
            ``(2) to assist States, Indian tribes, and political 
        subdivisions of States to address the shortage of housing 
        affordable to low-income families; and
            ``(3) consistent with the objectives of this title, to vest 
        in public housing agencies that perform well, the maximum 
        amount of responsibility and flexibility in program 
        administration, with appropriate accountability to both public 
        housing tenants and localities.''.

SEC. 102. MEMBERSHIP ON BOARD OF DIRECTORS.

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

``SEC. 27. MEMBERSHIP ON BOARD OF DIRECTORS.

    ``(a) Required Membership.--Except as provided in subsection (b), 
the membership of the board of directors of each public housing agency 
shall contain not less than 1 member who is a resident of a public 
housing project operated by the public housing agency.
    ``(b) Exception.--Subsection (a) shall not apply to any public 
housing agency in any State that requires the members of the board of 
directors of a public housing agency to be salaried and to serve on a 
full-time basis.
    ``(c) Nondiscrimination.--No person shall be prohibited from 
serving on the board of directors or similar governing body of a public 
housing agency because of the residence of that person in a public 
housing project.''.

SEC. 103. AUTHORITY OF PUBLIC HOUSING AGENCIES.

    (a) Authority of Public Housing Agencies.--
            (1) In general.--Section 3(a)(2) of the United States 
        Housing Act of 1937 (42 U.S.C. 1437a(a)(2)) is amended to read 
        as follows:
            ``(2) Authority of public housing agencies.--
        Notwithstanding paragraph (1), a public housing agency may 
        adopt ceiling rents that reflect the reasonable market value of 
        the housing, but that are not less than the actual monthly 
        costs--
                            ``(i) to operate the housing of the public 
                        housing agency; and
                            ``(ii) to make a deposit to a replacement 
                        reserve (in the sole discretion of the public 
                        housing agency).
                    ``(B) Minimum rent.--Notwithstanding paragraph (1), 
                a public housing agency may provide that each family 
                residing in a public housing project or receiving 
                tenant-based or project-based assistance under section 
                8 shall pay a minimum monthly rent in an amount not to 
                exceed $25 per month.
                    ``(C) Police officers.--
                            ``(i) In general.--Notwithstanding any 
                        other provision of law, a public housing agency 
                        may, in accordance with the public housing 
                        agency plan, allow a police officer who is not 
                        otherwise eligible for residence in public 
                        housing to reside in a public housing unit. The 
                        number and location of units occupied by police 
                        officers under this clause, and the terms and 
                        conditions of their tenancies, shall be 
                        determined by the public housing agency.
                            ``(ii) Definition.--As used in this 
                        subparagraph, the term `police officer' means 
                        any person determined by a public housing 
                        agency to be, during the period of residence of 
                        that person in public housing, employed on a 
                        full-time basis as a duly licensed professional 
                        police officer by a Federal, State, tribal, or 
                        local government or by any agency thereof 
                        (including a public housing agency having an 
                        accredited police force).
                    ``(D) Encouragement of self-sufficiency.--Each 
                public housing agency shall develop a rental policy 
                that encourages and rewards employment and economic 
                self-sufficiency.''.
            (2) Regulations.--
                    (A) In general.--The Secretary shall, by 
                regulation, after notice and an opportunity for public 
                comment, establish such requirements as may be 
                necessary to carry out section 3(a)(2)(A) of the United 
                States Housing Act of 1937, as amended by paragraph 
                (1).
                    (B) Transition rule.--Prior to the issuance of 
                final regulations under paragraph (1), a public housing 
                agency may implement ceiling rents, which shall be--
                            (i) determined in accordance with section 
                        3(a)(2)(A) of the United States Housing Act of 
                        1937, as that section existed on the day before 
                        the date of enactment of this Act;
                            (ii) equal to the 95th percentile of the 
                        rent paid for a unit of comparable size by 
                        tenants in the same public housing project or a 
                        group of comparable projects totaling 50 units 
                        or more; or
                            (iii) equal to the fair market rent for the 
                        area in which the unit is located.
    (b) Nontroubled Public Housing Agencies.--Section 3(a) of the 
United States Housing Act of 1937 (42 U.S.C. 1437(a)) is amended by 
adding at the end the following new paragraph:
            ``(3) Nontroubled public housing agencies.--
                    ``(A) In general.--Notwithstanding the rent 
                calculation formula in paragraph (1), and subject to 
                subparagraph (B), the Secretary shall permit a public 
                housing agency, other than a public housing agency 
                determined to be troubled pursuant to 6(j), to 
                determine the amount that a family residing in public 
                housing shall pay as rent.
                    ``(B) Limitation.--With respect to a family whose 
                income is equal to or less than 50 percent of the 
                median income for the area, as determined by the 
                Secretary with adjustments for smaller and larger 
                families, a public housing agency may not require a 
                family to pay as rent under subparagraph (A) an amount 
                that exceeds the greatest of--
                            ``(i) 30 percent of the monthly adjusted 
                        income of the family;
                            ``(ii) 10 percent of the monthly income of 
                        the family;
                            ``(iii) if the family is receiving payments 
                        for welfare assistance from a public agency and 
                        a part of those payments, adjusted in 
                        accordance with the actual housing costs of the 
                        family, is specifically designated by that 
                        public agency to meet the housing costs of the 
                        family, the portion of those payments that is 
                        so designated; and
                            ``(iv) $25.''.

SEC. 104. DEFINITIONS.

    (a) Definitions.--
            (1) Single persons.--Section 3(b)(3) of the United States 
        Housing Act of 1937 (42 U.S.C. 1437a(b)(3)) is amended--
                    (A) in subparagraph (A), in the third sentence, by 
                striking ``the Secretary shall'' and all that follows 
                before the period at the end and inserting the 
                following: ``the public housing agency may give 
                preference to single persons who are elderly or 
                disabled persons before single persons who are 
                otherwise eligible''; and
                    (B) in subparagraph (B), in the second sentence, by 
                striking ``regulations of the Secretary'' and inserting 
                ``public housing agency plan''.
            (2) Adjusted income.--Section 3(b)(5) of the United States 
        Housing Act of 1937 (42 U.S.C. 1437a(b)(5)) is amended to read 
        as follows:
            ``(5) Adjusted income.--The term `adjusted income' means 
        the income that remains after excluding--
                    ``(A) $480 for each member of the family residing 
                in the household (other than the head of the household 
                or the spouse of the head of the household)--
                            ``(i) who is under 18 years of age; or
                            ``(ii) who is--
                                    ``(I) 18 years of age or older; and
                                    ``(II) a person with disabilities 
                                or a full-time student;
                    ``(B) $400 for an elderly or disabled family;
                    ``(C) the amount by which the aggregate of--
                            ``(i) medical expenses for an elderly or 
                        disabled family; and
                            ``(ii) reasonable attendant care and 
                        auxiliary apparatus expenses for each family 
                        member who is a person with disabilities, to 
                        the extent necessary to enable any member of 
                        the family (including a member who is a person 
                        with disabilities) to be employed;
                exceeds 3 percent of the annual income of the family;
                    ``(D) child care expenses, to the extent necessary 
                to enable another member of the family to be employed 
                or to further his or her education;
                    ``(E) with respect to a family assisted by an 
                Indian housing authority only, excessive travel 
                expenses, not to exceed $25 per family per week, for 
                employment- or education-related travel; and
                    ``(F) any other income that the public housing 
                agency determines to be appropriate, as provided in the 
                public housing agency plan.''.
            (3) Indian housing authority; indian tribe.--
                    (A) In general.--Section 3(b) of the United States 
                Housing Act of 1937 (42 U.S.C. 1437a(b)) is amended by 
                striking paragraphs (11) and (12) and inserting the 
                following:
            ``(11) Indian housing authority.--The term `Indian housing 
        authority' means any entity that--
                    ``(A) is authorized to engage or assist in the 
                development or operation of low-income housing for 
                Indians; 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 
                        authorizing or enabling an Indian tribe to 
                        create housing authorities for Indians, 
                        including regional housing authorities in the 
                        State of Alaska.
            ``(12) Indian tribe.--The term `Indian tribe' means the 
        governing body of any Indian or Alaska Native tribe, band, 
        nation, pueblo, village, or community that the Secretary of the 
        Interior acknowledges to exist as an Indian Tribe, pursuant to 
        the Federally Recognized Indian Tribe List Act of 1994.''.
                    (B) Applicability.--The amendment made by 
                subparagraph (A) does not affect the existence, or the 
                ability to operate, of any Indian housing authority 
                established before the date of enactment of this Act by 
                any State recognized tribe, band, pueblo, group, 
                community, or nation of Indians or Alaska Natives that 
                does not qualify as an Indian tribe under section 3(b) 
                of the United States Housing Act of 1937, as amended by 
                this paragraph.
    (b) Disallowance of Earned Income From Public Housing Rent 
Determinations.--
            (1) In general.--Section 3 of the United States Housing Act 
        of 1937 (42 U.S.C. 1437a) is amended--
                    (A) by striking the undesignated paragraph at the 
                end of subsection (c)(3) (as added by section 515(b) of 
                Public Law 101-625); and
                    (B) by adding at the end the following new 
                subsection:
    ``(d) Disallowance of Earned Income From Public Housing Rent 
Determinations.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, the rent payable under subsection (a) by a family--
                    ``(A) that--
                            ``(i) occupies a unit in a public housing 
                        project; or
                            ``(ii) receives assistance under section 8; 
                        and
                    ``(B) whose income increases as a result of 
                employment of a member of the family who was previously 
                unemployed for 1 or more years (including a family 
                whose income increases as a result of the participation 
                of a family member in any family self-sufficiency or 
                other job training program);
        may not be increased as a result of the increased income due to 
        such employment during the 18-month period beginning on the 
        date on which the employment is commenced.
            ``(2) Phase-in of rate increases.--After the expiration of 
        the 18-month period referred to in paragraph (1), rent 
        increases due to the continued employment of the family member 
        described in paragraph (1)(B) shall be phased in over a 
        subsequent 3-year period.
            ``(3) Overall limitation.--Rent payable under subsection 
        (a) shall not exceed the amount determined under subsection 
        (a).''.
            (2) Applicability of amendment.--
                    (A) Public housing.--Notwithstanding the amendment 
                made by paragraph (1), any tenant of public housing 
                participating in the program under the authority 
                contained in the undesignated paragraph at the end of 
                section 3(c)(3) of the United States Housing Act of 
                1937, as that paragraph existed on the day before the 
                date of enactment this Act, shall be governed by that 
                authority after that date.
                    (B) Section 8.--The amendment made by paragraph (1) 
                shall apply to tenant-based assistance provided under 
                section 8 of the United States Housing Act of 1937, 
                with funds appropriated on or after October 1, 1996.
    (c) Definitions of Terms Used in Reference to Public Housing.--
            (1) In general.--Section 3(c) of the United States Housing 
        Act of 1937 (42 U.S.C. 1437a(c)) is amended--
                    (A) in paragraph (1), by inserting ``and of the 
                fees and related costs normally involved in obtaining 
                non-Federal financing and tax credits with or without 
                private and nonprofit partners'' after ``carrying 
                charges''; and
                    (B) in paragraph (2), in the first sentence, by 
                striking ``security personnel),'' and all that follows 
                through the period and inserting the following: 
                ``security personnel), service coordinators, drug 
                elimination activities, or financing in connection with 
                a public housing project, including projects developed 
                with non-Federal financing and tax credits, with or 
                without private and nonprofit partners.''.
            (2) Technical correction.--Section 622(c) of the Housing 
        and Community Development Act of 1992 (Public Law 102-550; 106 
        Stat. 3817) is amended by striking ```project.''' and inserting 
        ``paragraph (3)''.
            (3) New definitions.--Section 3(c) of the United States 
        Housing Act of 1937 (42 U.S.C. 1437a(c)) is amended by adding 
        at the end the following new paragraphs:
            ``(6) Public housing agency plan.--The term `public housing 
        agency plan' means the plan of the public housing agency 
        prepared in accordance with section 5A.
            ``(7) Disabled housing.--The term `disabled housing' means 
        any public housing project, building, or portion of a project 
        or building, that is designated by a public housing agency for 
        occupancy exclusively by disabled persons or families.
            ``(8) Elderly housing.--The term `elderly housing' means 
        any public housing project, building, or portion of a project 
        or building, that is designated by a public housing agency 
        exclusively for occupancy exclusively by elderly persons or 
        families, including elderly disabled persons or families.
            ``(9) Mixed-income project.--The term `mixed-income 
        project' means a public housing project that meets the 
        requirements of section 28.
            ``(10) Capital fund.--The term `Capital Fund' means the 
        fund established under section 9(c).
            ``(11) Operating fund.--The term `Operating Fund' means the 
        fund established under section 9(d).''.

SEC. 105. CONTRIBUTIONS FOR LOWER INCOME HOUSING PROJECTS.

    (a) In General.--Section 5 of the United States Housing Act of 1937 
(42 U.S.C. 1437c) is amended by striking subsections (h) through (l).
    (b) Conforming Amendments.--The United States Housing Act of 1937 
(42 U.S.C. 1437 et seq.) is amended--
            (1) in section 21(d), by striking ``section 5(h) or'';
            (2) in section 25(l)(1), by striking ``and for sale under 
        section 5(h)''; and
            (3) in section 307, by striking ``section 5(h) and''.

SEC. 106. PUBLIC HOUSING AGENCY PLAN.

    (a) In General.--Title I of the United States Housing Act of 1937 
(42 U.S.C. 1437 et seq.) is amended by inserting after section 5 the 
following new section:

``SEC. 5A. PUBLIC HOUSING AGENCY PLAN.

    ``(a) In General.--
            ``(1) Submission.--Each public housing agency shall submit 
        to the Secretary a written public housing agency plan developed 
        in accordance with this section.
            ``(2) Consistency requirement.--Each public housing agency 
        plan submitted to the Secretary under paragraph (1) shall be--
                    ``(A) made in consultation with the local advisory 
                board established under subsection (c);
                    ``(B) consistent with the comprehensive housing 
                affordability strategy for the jurisdiction in which 
                the public housing agency is located, as provided under 
                title I of the Cranston-Gonzalez National Affordable 
                Housing Act, or, with respect to any Indian tribe, a 
                comprehensive plan developed by the Indian tribe, if 
                applicable; and
                    ``(C) accompanied by a certification by an 
                appropriate State, tribal, or local public official 
                that the plan meets the requirements of subparagraph 
                (B).
    ``(b) Contents.--Each public housing agency plan shall contain, at 
a minimum, the following:
            ``(1) Certification.--
                    ``(A) In general.--With respect to a public housing 
                agency that has not received assistance under this 
                title as of the date on which the public housing agency 
                plan of that public housing agency is submitted, or a 
                public housing agency that is subject to amended 
                authority, a written certification that the public 
                housing agency is a governmental entity or public body 
                (or an agency or instrumentality thereof) that is 
                authorized to engage or assist in the development or 
                operation of low-income housing under this title.
                    ``(B) Identification of certain references.--
                Subject to subparagraph (A), any reference in any 
                provision of law of the jurisdiction authorizing the 
                creation of the public housing agency shall be 
                identified and any legislative declaration of purpose 
                in regard thereto shall be set forth in the 
                certification with full text.
            ``(2) Statement of policy.--An annual statement of policy 
        identifying the primary goals and objectives of the public 
        housing agency for the year for which the statement is 
        submitted, together with any major developments, projects, or 
        programs, including all proposed costs and activities carried 
        out with the use of Capital Fund and Operating Fund 
        distributions made available to the public housing agency under 
        section 9.
            ``(3) Statement of needs.--An annual statement of the 
        housing needs of low-income families residing in the community, 
        and of other low-income families on the waiting list of the 
        public housing agency (including the housing needs of elderly 
        families and disabled families), and the means by which the 
        public housing agency intends, to the maximum extent 
        practicable, to address those needs.
            ``(4) General policies, rules, and regulations.--The 
        policies, rules, and regulations of the public housing agency 
        regarding--
                    ``(A) the requirements for the selection and 
                admission of eligible families into the program or 
                programs of the public housing agency, including--
                            ``(i) tenant screening policies;
                            ``(ii) any preferences or priorities for 
                        selection and admission;
                            ``(iii) annual income verification 
                        procedures; and
                            ``(iv) requirements relating to the 
                        administration of any waiting lists of the 
                        public housing agency;
                    ``(B) the procedure for assignment of families 
                admitted into the program to dwelling units owned, 
                leased, managed, or assisted by the public housing 
                agency;
                    ``(C) the requirements for occupancy of dwelling 
                units, including all standard lease provisions, and 
                conditions for continued occupancy, termination, and 
                eviction;
                    ``(D) procedures for establishing rents, including 
                ceiling rents and adjustments to income; and
                    ``(E) procedures for designating certain public 
                housing projects, or portions of projects, for 
                occupancy by elderly families, disabled families, or by 
                elderly and disabled families.
            ``(5) Operation and management.--The policies, rules, and 
        regulations relating to the management of the public housing 
        agency, and the public housing projects and programs of the 
        public housing agency, including--
                    ``(A) a description of the manner in which the 
                public housing agency is organized (including any 
                consortia or joint ventures) and staffed to perform the 
                duties and functions of the public housing agency and 
                to administer the Operating Fund distributions of the 
                public housing agency;
                    ``(B) policies relating to the rental of dwelling 
                units owned or operated by the public housing agency, 
                including policies designed to reduce vacancies;
                    ``(C) policies relating to providing a safe and 
                secure environment in public housing units, including 
                anticrime and antidrug activities;
                    ``(D) policies relating to the management and 
                operation, or participation in mixed-income projects, 
                if applicable;
                    ``(E) policies relating to services and amenities 
                provided or offered to assisted families, including the 
                provision of service coordinators and services designed 
                for certain populations, such as the elderly and 
                disabled;
                    ``(F) procedures for implementing the work 
                requirements of section 12(c);
                    ``(G) procedures for identifying management 
                weaknesses;
                    ``(H) objectives for improving management 
                practices;
                    ``(I) a description of management initiatives to 
                control the costs of operating the public housing 
                agency;
                    ``(J) a plan for preventative maintenance and a 
                plan for routine maintenance;
                    ``(K) policies relating to any plans for converting 
                public housing to a system of tenant-based assistance; 
                and
                    ``(L) policies relating to the operation of any 
                homeownership programs.
            ``(6) Capital fund requirements.--The policies, rules, and 
        regulations relating to the management and administration of 
        the Capital Fund distributions of the public housing agency, 
        including--
                    ``(A) the capital needs of the public housing 
                agency;
                    ``(B) plans for capital expenditures related to 
                providing a safe and secure environment in public 
                housing units, including anticrime and antidrug 
                activities;
                    ``(C) policies relating to providing a safe and 
                secure environment in public housing units, including 
                anticrime and antidrug activities;
                    ``(D) policies relating to the capital requirements 
                of mixed-income projects, if applicable;
                    ``(E) an annual plan and, if appropriate, a 5-year 
                plan of the public housing agency for the capital needs 
                of the existing dwelling units of the public housing 
                agency, each of which shall include a general statement 
                identifying the long-term viability and physical 
                condition of each of the public housing projects and 
                other property of the public housing agency, including 
                cost estimates;
                    ``(F) a plan to handle emergencies and other 
                disasters;
                    ``(G) the use of funds for new or additional units, 
                including capital contributions to mixed-income 
                projects, if applicable;
                    ``(H) any plans for the sale of existing dwelling 
                units to low-income residents or organizations acting 
                as conduits for sales to such residents under a 
                homeownership plan;
                    ``(I) any plans for converting public housing units 
                to a system of tenant-based assistance; and
                    ``(J) any plans for demolition and disposition of 
                public housing units, including any plans for 
                replacement units and any plans providing for the 
                relocation of residents who will be displaced by a 
                demolition or disposition of units.
            ``(7) Economic and social self-sufficiency programs.--A 
        description of any policies, programs, plans, and activities of 
        the public housing agency for the enhancement of the economic 
        and social self-sufficiency of residents assisted by the 
        programs of the public housing agency.
            ``(8) Annual audit.--The results of an annual audit 
        (including any audit of management practices, as required by 
        the Secretary) of the public housing agency, which shall be 
        conducted by an independent certified public accounting firm 
        pursuant to generally accepted accounting principles.
    ``(c) Local Advisory Board.--
            ``(1) In general.--Except as provided in paragraph (5), 
        each public housing agency shall establish one or more local 
        advisory boards in accordance with this subsection, the 
        membership of which shall adequately reflect and represent all 
        of the residents of the dwelling units owned, operated, or 
        assisted by the public housing agency.
            ``(2) Membership.--Each local advisory board established 
        under this subsection shall be composed of the following 
        members:
                    ``(A) Tenants.--Not less than 60 percent of the 
                members of the board shall be tenants of dwelling units 
                owned, operated, or assisted by the public housing 
                agency, including representatives of any resident 
                organizations.
                    ``(B) Other members.--The members of the board, 
                other than the members described in subparagraph (A), 
                shall include--
                            ``(i) representatives of the community in 
                        which the public housing agency is located; and
                            ``(ii) local government officials of the 
                        community in which the public housing agency is 
                        located.
            ``(3) Purpose.--Each local advisory board established under 
        this subsection shall assist and make recommendations regarding 
        the development of the public housing agency plan. The public 
        housing agency shall consider the recommendations of the local 
        advisory board in preparing the final public housing agency 
        plan, and shall include a copy of those recommendations in the 
        public housing agency plan submitted to the Secretary under 
        this section.
            ``(4) Inapplicability to indian housing.--This subsection 
        does not apply to an Indian housing authority.
            ``(5) Waiver.--The Secretary may waive the requirements of 
        this subsection with respect to tenant representation on the 
        local advisory board of a public housing agency, if the public 
        housing agency demonstrates to the satisfaction of the 
        Secretary that a resident council or other tenant organization 
        of the public housing agency adequately represents the 
        interests of the tenants of the public housing agency.
    ``(d) Publication of Notice.--
            ``(1) In general.--Not later than 45 days before the date 
        of a hearing conducted under paragraph (2) by the governing 
        body of a public housing agency, the public housing agency 
        shall publish a notice informing the public that--
                    ``(A) the proposed public housing agency plan is 
                available for inspection at the principal office of the 
                public housing agency during normal business hours; and
                    ``(B) a public hearing will be conducted to discuss 
                the public housing agency plan and to invite public 
                comment regarding that plan.
            ``(2) Public hearing.--Each public housing agency shall, at 
        a location that is convenient to residents, conduct a public 
        hearing, as provided in the notice published under paragraph 
        (1).
            ``(3) Adoption of plan.--After conducting the public 
        hearing under paragraph (2), and after considering all public 
        comments received and, in consultation with the local advisory 
        board, making any appropriate changes in the public housing 
        agency plan, the public housing agency shall--
                    ``(A) adopt the public housing agency plan; and
                    ``(B) submit the plan to the Secretary in 
                accordance with this section.
    ``(e) Coordinated Procedures.--Each public housing agency (other 
than an Indian housing authority) shall, in conjunction with the State 
or relevant unit of general local government, establish procedures to 
ensure that the public housing agency plan required by this section is 
consistent with the applicable comprehensive housing affordability 
strategy for the jurisdiction in which the public housing agency is 
located, in accordance with title I of the Cranston-Gonzalez National 
Affordable Housing Act.
    ``(f) Amendments and Modifications to Plans.--
            ``(1) In general.--Except as provided in paragraph (2), 
        nothing in this section shall preclude a public housing agency, 
        after submitting a plan to the Secretary in accordance with 
        this section, from amending or modifying any policy, rule, 
        regulation, or plan of the public housing agency, except that 
        no such significant amendment or modification may be adopted or 
        implemented--
                    ``(A) other than at a duly called meeting of 
                commissioners (or other comparable governing body) of 
                the public housing agency that is open to the public; 
                and
                    ``(B) until notification of the amendment or 
                modification is provided to the Secretary and approved 
                in accordance with subsection (g)(2).
            ``(2) Consistency.--Each significant amendment or 
        modification to a public housing agency plan submitted to the 
        Secretary under this section shall--
                    ``(A) meet the consistency requirement of 
                subsection (a)(2);
                    ``(B) be subject to the notice and public hearing 
                requirements of subsection (d); and
                    ``(C) be subject to approval by the Secretary in 
                accordance with subsection (g)(2).
    ``(g) Timing of Plans.--
            ``(1) In general.--
                    ``(A) Initial submission.--Each public housing 
                agency shall submit the initial plan required by this 
                section, and any amendment or modification to the 
                initial plan, to the Secretary at such time and in such 
                form as the Secretary shall require.
                    ``(B) Annual submission.--Not later than 60 days 
                prior to the start of the fiscal year of the public 
                housing agency, after initial submission of the plan 
                required by this section in accordance with 
                subparagraph (A), each public housing agency shall 
                annually submit to the Secretary a plan update, 
                including any amendments or modifications to the public 
                housing agency plan.
            ``(2) Review and approval.--
                    ``(A) Review.--After submission of the public 
                housing agency plan or any amendment or modification to 
                the plan to the Secretary, to the extent that the 
                Secretary considers such action to be necessary to make 
                determinations under this subparagraph, the Secretary 
                shall review the public housing agency plan (including 
                any amendments or modifications thereto) to determine 
                whether the contents of the plan--
                            ``(i) set forth the information required by 
                        this section to be contained in a public 
                        housing agency plan;
                            ``(ii) are consistent with information and 
                        data available to the Secretary; and
                            ``(iii) are prohibited by or inconsistent 
                        with any provision of this title or other 
                        applicable law.
                    ``(B) Approval.--
                            ``(i) In general.--Except as provided in 
                        paragraph (3)(B), not later than 60 days after 
                        the date on which a public housing agency plan 
                        is submitted in accordance with this section, 
                        the Secretary shall provide written notice to 
                        the public housing agency if the plan has been 
                        disapproved, stating with specificity the 
                        reasons for the disapproval.
                            ``(ii) Failure to provide notice of 
                        disapproval.--If the Secretary does not provide 
                        notice of disapproval under clause (i) before 
                        the expiration of the 60-day period described 
                        in clause (i), the public housing agency plan 
                        shall be deemed to be approved by the 
                        Secretary.
            ``(3) Secretarial discretion.--
                    ``(A) In general.--The Secretary may require such 
                additional information as the Secretary determines to 
                be appropriate for each public housing agency that is--
                            ``(i) at risk of being designated as 
                        troubled under section 6(j); or
                            ``(ii) designated as troubled under section 
                        6(j).
                    ``(B) Troubled agencies.--The Secretary shall 
                provide explicit written approval or disapproval, in a 
                timely manner, for a public housing agency plan 
                submitted by any public housing agency designated by 
                the Secretary as a troubled public housing agency under 
                section 6(j).
            ``(4) Streamlined plan.--In carrying out this section, the 
        Secretary may establish a streamlined public housing agency 
        plan for--
                    ``(A) public housing agencies that are determined 
                by the Secretary to be high performing public housing 
                agencies; and
                    ``(B) public housing agencies with less than 250 
                public housing units that have not been designated as 
                troubled under section 6(j).''.
    (b) Implementation.--
            (1) Interim rule.--Not later than 120 days after the date 
        of enactment of this Act, the Secretary shall issue an interim 
        rule to require the submission of an interim public housing 
        agency plan by each public housing agency, as required by 
        section 5A of the United States Housing Act of 1937 (as added 
        by subsection (a) of this section).
            (2) Final regulations.--Not later than 1 year after the 
        date of enactment of this Act, in accordance with the 
        negotiated rulemaking procedures set forth in subchapter III of 
        chapter 5 of title 5, United States Code, the Secretary shall 
        promulgate final regulations implementing section 5A of the 
        United States Housing Act of 1937, as added by subsection (a) 
        of this section.
            (3) Indian housing authorities.--In carrying out this 
        subsection, the Secretary may implement separate rules and 
        regulations for the Indian housing program.
    (c) Audit and Review; Report.--
            (1) Audit and review.--Not later than 1 year after the 
        effective date of final regulations promulgated under 
        subsection (b)(2), in order to determine the degree of 
        compliance with public housing agency plans approved under 
        section 5A of the United States Housing Act of 1937, as added 
        by this section, by public housing agencies, the Comptroller 
        General of the United States shall conduct--
                    (A) a review of a representative sample of the 
                public housing agency plans approved under such section 
                5A before that date; and
                    (B) an audit and review of the public housing 
                agencies submitting those plans.
            (2) Report.--Not later than 2 years after the date on which 
        public housing agency plans are initially required to be 
        submitted under section 5A of the United States Housing Act of 
        1937, as added by this section, the Comptroller General of the 
        United States shall submit to the Congress a report, which 
        shall include--
                    (A) a description of the results of each audit and 
                review under paragraph (1); and
                    (B) any recommendations for increasing compliance 
                by public housing agencies with their public housing 
                agency plans approved under section 5A of the United 
                States Housing Act of 1937, as added by this section.

SEC. 107. CONTRACT PROVISIONS AND REQUIREMENTS.

    (a) Conditions.--Section 6(a) of the United States Housing Act of 
1937 (42 U.S.C. 1437d(a)) is amended--
            (1) in the first sentence, by inserting ``, in a manner 
        consistent with the public housing agency plan'' before the 
        period; and
            (2) by striking the second sentence.
    (b) Repeal of Federal Preferences; Revision of Maximum Income 
Limits; Certification of Compliance With Requirements; Notification of 
Eligibility.--Section 6(c) of the United States Housing Act of 1937 (42 
U.S.C. 1437d(c)) is amended to read as follows:
    ``(c) [Reserved.]''.
    (c) Excess Funds.--Section 6(e) of the United States Housing Act of 
1937 (42 U.S.C. 1437d(e)) is amended to read as follows:
    ``(e) [Reserved.]''.
    (d) Performance Indicators for Public Housing Agencies.--Section 
6(j) of the United States Housing Act of 1937 (42 U.S.C. 1437d(j)) is 
amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (B)--
                            (i) by striking ``obligated'' and inserting 
                        ``provided''; and
                            (ii) by striking ``unexpended'' and 
                        inserting ``unobligated by the public housing 
                        agency'';
                    (B) in subparagraph (D), by striking ``energy'' and 
                inserting ``utility'';
                    (C) by redesignating subparagraph (H) as 
                subparagraph (J); and
                    (D) by inserting after subparagraph (G) the 
                following new subparagraphs:
                    ``(H) The extent to which the public housing agency 
                provides--
                            ``(i) effective programs and activities to 
                        promote the economic self-sufficiency of public 
                        housing tenants; and
                            ``(ii) public housing tenants with 
                        opportunities for involvement in the 
                        administration of the public housing.
                    ``(I) The extent to which the public housing agency 
                successfully meets the goals and carries out the 
                activities and programs of the public housing agency 
                plan under section 5(A).''; and
            (2) in paragraph (2)(A)(i), by inserting after the first 
        sentence the following: ``The Secretary may use a simplified 
        set of indicators for public housing agencies with less than 
        250 public housing units.''.
    (e) Leases.--Section 6(l) of the United States Housing Act of 1937 
(42 U.S.C. 1437d(l)) is amended--
            (1) in paragraph (3), by striking ``not be less than'' and 
        all that follows before the semicolon and inserting ``be the 
        period of time required under State law''; and
            (2) in paragraph (5), by striking ``on or near such 
        premises''.
    (f) Public Housing Assistance to Foster Care Children.--Section 
6(o) of the United States Housing Act of 1937 (42 U.S.C. 1437d(o)) is 
amended by striking ``Subject'' and all that follows through ``, in'' 
and inserting ``In''.
    (g) Preference for Areas With Inadequate Supply of Very Low-Income 
Housing.--Section 6(p) of the United States Housing Act of 1937 (42 
U.S.C. 1437d(p)) is amended to read as follows:
    ``(p) [Reserved.]''.
    (h) Availability of Criminal Records for Screening and Eviction; 
Eviction for Drug-Related Activity.--Section 6 of the United States 
Housing Act of 1937 (42 U.S.C. 1437d) is amended by adding at the end 
the following new subsections:
    ``(q) Availability of Records.--
            ``(1) In general.--
                    ``(A) Provision of information.--Notwithstanding 
                any other provision of law, except as provided in 
                subparagraph (B), the National Crime Information 
                Center, police departments, and other law enforcement 
                agencies shall, upon request, provide information to 
                public housing agencies regarding the criminal 
                conviction records of adult applicants for, or tenants 
                of, public housing for purposes of applicant screening, 
                lease enforcement, and eviction.
                    ``(B) Exception.--Except as provided under any 
                provision of State, tribal, or local law, no law 
                enforcement agency described in subparagraph (A) shall 
                provide information under this paragraph relating to 
                any criminal conviction if the date of that conviction 
                occurred 5 or more years prior to the date on which the 
                request for the information is made.
            ``(2) Opportunity to dispute.--Before an adverse action is 
        taken on the basis of a criminal record, the public housing 
        agency shall provide the tenant or applicant with a copy of the 
        criminal record and an opportunity to dispute the accuracy and 
        relevance of that record.
            ``(3) Fee.--A public housing agency may be charged a 
        reasonable fee for information provided under paragraph (1).
            ``(4) Records management.--Each public housing agency shall 
        establish and implement a system of records management that 
        ensures that any criminal record received by the public housing 
        agency is--
                    ``(A) maintained confidentially;
                    ``(B) not misused or improperly disseminated; and
                    ``(C) destroyed, once the purpose for which the 
                record was requested has been accomplished.
            ``(5) Definition.--For purposes of this subsection, the 
        term `adult' means a person who is 18 years of age or older, or 
        who has been convicted of a crime as an adult under any 
        Federal, State, or tribal law.
    ``(r) Eviction for Drug-Related Activity.--Any tenant evicted from 
housing assisted under this title by reason of drug-related criminal 
activity (as that term is defined in section 8(f)(5)) shall not be 
eligible for housing assistance under this title during the 3-year 
period beginning on the date of such eviction, unless the evicted 
tenant successfully completes a rehabilitation program approved by the 
public housing agency (which shall include a waiver of this subsection 
if the circumstances leading to eviction no longer exist).''.
    (i) Transition Rule Relating to Preferences.--During the period 
beginning on the date of enactment of this Act and ending on the date 
on which the initial public housing agency plan of a public housing 
agency is approved under section 5A of the United States Housing Act of 
1937, as added by this Act, the public housing agency may establish 
local preferences for making available public housing under the United 
States Housing Act of 1937 and for providing tenant-based assistance 
under section 8 of that Act.

SEC. 108. EXPANSION OF POWERS.

    (a) In General.--Section 6(j)(3) of the United States Housing Act 
of 1937 (42 U.S.C. 1437d(j)(3)) is amended--
            (1) in subparagraph (A)--
                    (A) by redesignating clauses (iii) and (iv) as 
                clauses (iv) and (v), respectively; and
                    (B) by inserting after clause (ii) the following 
                new clause:
                            ``(iii) take possession of the public 
                        housing agency, including any project or 
                        function of the agency, including any project 
                        or function under any other provision of this 
                        title;'';
            (2) by redesignating subparagraphs (B) through (D) as 
        subparagraphs (E) through (G), respectively;
            (3) by inserting after subparagraph (A) the following new 
        subparagraphs:
                    ``(B)(i) If a public housing agency is identified 
                as troubled under this subsection, the Secretary shall 
                notify the agency of the troubled status of the agency.
                    ``(ii) The Secretary may give a public housing 
                agency a 1-year period, beginning on the later of the 
                date on which the agency receives notice from the 
                Secretary of the troubled status of the agency under 
                clause (i), and the date of enactment of the Public 
                Housing Reform and Empowerment Act of 1995, within 
                which to demonstrate improvement satisfactory to the 
                Secretary. Nothing in this clause shall preclude the 
                Secretary from taking any action the Secretary 
                considers necessary before the commencement or the 
                expiration of the 1-year period described in this 
                clause.
                    ``(iii) Upon the expiration of the 1-year period 
                described in clause (ii), if the troubled public 
                housing agency has not demonstrated improvement 
                satisfactory to the Secretary and the Secretary has not 
                yet declared the agency to be in breach of the contract 
                of the agency with the Federal Government under this 
                title, the Secretary shall declare the public housing 
                agency to be in substantial default, as described in 
                subparagraph (A).
                    ``(iv) Upon declaration of a substantial default 
                under clause (iii), the Secretary--
                            ``(I) shall either--
                                    ``(aa) petition for the appointment 
                                of a receiver pursuant to subparagraph 
                                (A)(ii);
                                    ``(bb) take possession of the 
                                public housing agency or any public 
                                housing projects of the public housing 
                                agency pursuant to subparagraph 
                                (A)(iii); or
                                    ``(cc) take such actions as the 
                                Secretary determines to be necessary to 
                                cure the substantial default; and
                            ``(II) may, in addition, take other 
                        appropriate action.
                    ``(C)(i) If a receiver is appointed pursuant to 
                subparagraph (A)(ii), in addition to the powers 
                accorded by the court appointing the receiver, the 
                receiver--
                            ``(I) may abrogate any contract that 
                        substantially impedes correction of the 
                        substantial default;
                            ``(II) may demolish and dispose of the 
                        assets of the public housing agency, in 
                        accordance with section 18, including the 
                        transfer of properties to resident-supported 
                        nonprofit entities;
                            ``(III) if determined to be appropriate by 
                        the Secretary, may require the establishment, 
                        as permitted by applicable State, tribal, and 
                        local law, of one or more new public housing 
                        agencies; and
                            ``(IV) shall not be subject to any State, 
                        tribal, or local law relating to civil service 
                        requirements, employee rights, procurement, or 
                        financial or administrative controls that, in 
                        the determination of the receiver, 
                        substantially impedes correction of the 
                        substantial default.
                    ``(ii) For purposes of this subparagraph, the term 
                `public housing agency' includes any project or 
                function of a public housing agency, as appropriate, 
                including any project or function under any other 
                provision of this title.
                    ``(D)(i) If the Secretary takes possession of a 
                public housing agency, or any project or function of 
                the agency, pursuant to subparagraph (A)(iii), the 
                Secretary--
                            ``(I) may abrogate any contract that 
                        substantially impedes correction of the 
                        substantial default;
                            ``(II) may demolish and dispose of the 
                        assets of the public housing agency, in 
                        accordance with section 18, including the 
                        transfer of properties to resident-supported 
                        nonprofit entities;
                            ``(III) may require the establishment, as 
                        permitted by applicable State, tribal, and 
                        local law, of one or more new public housing 
                        agencies;
                            ``(IV) shall not be subject to any State, 
                        tribal, or local law relating to civil service 
                        requirements, employee rights, procurement, or 
                        financial or administrative controls that, in 
                        the determination of the Secretary, 
                        substantially impedes correction of the 
                        substantial default; and
                            ``(V) shall have such additional authority 
                        as a district court of the United States has 
                        conferred under like circumstances on a 
                        receiver to fulfill the purposes of the 
                        receivership.
                    ``(ii) The Secretary may appoint, on a competitive 
                or noncompetitive basis, an individual or entity as an 
                administrative receiver to assume the responsibilities 
                of the Secretary under this subparagraph for the 
                administration of a public housing agency. The 
                Secretary may delegate to the administrative receiver 
                any or all of the powers given the Secretary by this 
                subparagraph, as the Secretary determines to be 
                appropriate.
                    ``(iii) Regardless of any delegation under this 
                subparagraph, an administrative receiver may not 
                require the establishment of one or more new public 
                housing agencies pursuant to clause (i)(III), unless 
                the Secretary first approves an application by the 
                administrative receiver to authorize such 
                establishment.
                    ``(iv) For purposes of this subparagraph, the term 
                `public housing agency' includes any project or 
                function of a public housing agency, as appropriate, 
                including any project or function under any other 
                provision of this title.''; and
            (4) by adding at the end the following new subparagraph:
                    ``(H) If the Secretary (or an administrative 
                receiver appointed by the Secretary) takes possession 
                of a public housing agency (including any project or 
                function of the agency), or if a receiver is appointed 
                by a court, the Secretary or receiver shall be deemed 
                to be acting not in the official capacity of that 
                person or entity, but rather in the capacity of the 
                public housing agency, and any liability incurred, 
                regardless of whether the incident giving rise to that 
                liability occurred while the Secretary or receiver was 
                in possession of the public housing agency (including 
                any project or function of the agency), shall be the 
                liability of the public housing agency.''.
    (b) Applicability.--The amendments made by subsection (a) shall 
apply to a public housing agency that is found to be in substantial 
default, on or after the date of enactment of this Act, with respect to 
the covenants or conditions to which the agency is subject (as such 
substantial default is defined in the contract for contributions of the 
agency) or with respect to an agreement entered into under section 
6(j)(2)(C) of the United States Housing Act of 1937.

SEC. 109. PUBLIC HOUSING DESIGNATED FOR THE ELDERLY AND THE DISABLED.

    (a) In General.--Section 7 of the United States Housing Act of 1937 
(42 U.S.C. 1437e) is amended to read as follows:

``SEC. 7. AUTHORITY TO PROVIDE DESIGNATED HOUSING.

    ``(a) In General.--Notwithstanding any other provision of law, a 
public housing agency may, in the discretion of the public housing 
agency and without approval by the Secretary, designate public housing 
projects or mixed-income projects (or portions of projects) for 
occupancy as elderly housing, disabled housing, or elderly and disabled 
housing. The public housing agency shall establish requirements for 
this section, including priorities for occupancy, in the public housing 
agency plan.
    ``(b) Priority for Occupancy.--
            ``(1) In general.--In determining priority for admission to 
        public housing projects (or portions of projects) that are 
        designated for occupancy under this section, the public housing 
        agency may make units in such projects (or portions of 
        projects) available only to the types of families for whom the 
        project is designated.
            ``(2) Eligibility of near-elderly families.--If a public 
        housing agency determines that there are insufficient numbers 
        of elderly families to fill all the units in a public housing 
        project (or portion thereof) designated under this section for 
        occupancy by only elderly families, the agency may provide that 
        near-elderly families who qualify for occupancy may occupy 
        dwelling units in the public housing project (or portion 
        thereof).
            ``(3) Vacancy.--Notwithstanding paragraphs (1) and (2), in 
        designating a public housing project (or portion thereof) for 
        occupancy by only certain types of families under this section, 
        a public housing agency shall make any dwelling unit that is 
        ready for occupancy in such a project (or portion thereof) that 
        has been vacant for more than 60 consecutive days generally 
        available for occupancy (subject to this title) without regard 
        to that designation.
    ``(c) Availability of Housing.--
            ``(1) Tenant choice.--The decision of any disabled family 
        not to occupy or accept occupancy in an appropriate public 
        housing project or to otherwise accept any assistance made 
        available to the family under this title shall not adversely 
        affect the family with respect to a public housing agency 
        making available occupancy in other appropriate public housing 
        projects or to otherwise make assistance available to that 
        family under this title.
            ``(2) Discriminatory selection.--Paragraph (1) does not 
        apply to any family that decides not to occupy or accept an 
        appropriate dwelling unit in public housing or to accept 
        assistance under this Act on the basis of the race, color, 
        religion, gender, disability, familial status, or national 
        origin of occupants of the housing or the surrounding area.
            ``(3) Appropriateness of dwelling units.--This section may 
        not be construed to require a public housing agency to offer 
        occupancy in any dwelling unit assisted under this Act to any 
        family that is not of appropriate family size for the dwelling 
        unit.
    ``(d) Prohibition of Evictions.--Any tenant who is lawfully 
residing in a dwelling unit in a public housing project may not be 
evicted or otherwise required to vacate that unit as a result of the 
designation of the public housing project (or portion thereof) under 
this section or as a result of any other action taken by the Secretary 
or any public housing agency pursuant to this section.
    ``(e) Limitation on Occupancy in Designated Projects.--
            ``(1) Occupancy limitation.--Notwithstanding any other 
        provision of law, a dwelling unit in a public housing project 
        (or portion of a project) that is designated under subsection 
        (a) shall not be occupied by any person whose illegal use (or 
        pattern of illegal use) of a controlled substance or abuse (or 
        pattern of abuse) of alcohol--
                    ``(A) constitutes a disability; and
                    ``(B) provides reasonable cause for the public 
                housing agency to believe that such occupancy could 
                interfere with the health, safety, or right to peaceful 
                enjoyment of the premises by the tenants of the public 
                housing project.
            ``(2) Required statement.--A public housing agency may not 
        make a dwelling unit in a public housing project (or portion of 
        a project) designated under subsection (a) available for 
        occupancy to any family, unless the application for occupancy 
        by that family is accompanied by a signed statement that no 
        person who will be occupying the unit illegally uses a 
        controlled substance, or abuses alcohol, in a manner that would 
        interfere with the health, safety, or right to peaceful 
        enjoyment of the premises by the tenants of the public housing 
        project.''.
    (b) Lease Provisions.--Section 6(l) of the United States Housing 
Act of 1937 (42 U.S.C. 1437d(l)) is amended--
            (1) in paragraph (5), by striking ``and'' at the end;
            (2) by redesignating paragraph (6) as paragraph (7); and
            (3) by inserting after paragraph (5) following new 
        paragraph:
            ``(6) provide that any occupancy in violation of section 
        7(e)(1) or the furnishing of any false or misleading 
        information pursuant to section 7(e)(2) shall be cause for 
        termination of tenancy; and''.
    (c) Conforming Amendment.--Section 6(c)(4)(A) of the United States 
Housing Act of 1937 (42 U.S.C. 1437(b)(4)(A)) is amended by striking 
``section 7(a)'' and inserting ``section 7''.

SEC. 110. PUBLIC HOUSING CAPITAL AND OPERATING FUNDS.

    (a) In General.--Section 9 of the United States Housing Act of 1937 
(42 U.S.C. 1437g) is amended to read as follows:

``SEC. 9. PUBLIC HOUSING CAPITAL AND OPERATING FUNDS.

    ``(a) In General.--Except for assistance provided under section 8 
of this Act or as otherwise provided in the Public Housing Reform and 
Empowerment Act of 1995, all programs under which assistance is 
provided for public housing under this Act on the day before October 1, 
1997, shall be merged, as appropriate, into either--
            ``(1) the Capital Fund established under subsection (c); or
            ``(2) the Operating Fund established under subsection (d).
    ``(b) Use of Existing Funds.--With the exception of funds made 
available pursuant to section 8 or section 20(f) and funds made 
available for the urban revitalization demonstration program authorized 
under the Department of Veterans Affairs and Housing and Urban 
Development, and Independent Agencies Appropriations Acts--
            ``(1) funds made available to the Secretary for public 
        housing purposes that have not been obligated by the Secretary 
        to a public housing agency as of October 1, 1997, shall be made 
        available, for the period originally provided in law, for use 
        in either the Capital Fund or the Operating Fund, as 
        appropriate; and
            ``(2) funds made available to the Secretary for public 
        housing purposes that have been obligated by the Secretary to a 
        public housing agency but that, as of October 1, 1997, have not 
        been obligated by the public housing agency, may be made 
        available by that public housing agency, for the period 
        originally provided in law, for use in either the Capital Fund 
        or the Operating Fund, as appropriate.
    ``(c) Capital Fund.--
            ``(1) In general.--The Secretary shall establish a Capital 
        Fund for the purpose of making assistance available to public 
        housing agencies to carry out capital and management 
        activities, including--
                    ``(A) the development and modernization of public 
                housing projects, including the redesign, 
                reconstruction, and reconfiguration of public housing 
                sites and buildings and the development of mixed-income 
                projects;
                    ``(B) vacancy reduction;
                    ``(C) addressing deferred maintenance needs and the 
                replacement of dwelling equipment;
                    ``(D) planned code compliance;
                    ``(E) management improvements;
                    ``(F) demolition and replacement;
                    ``(G) tenant relocation;
                    ``(H) capital expenditures to facilitate programs 
                to improve the economic empowerment and self-
                sufficiency of public housing tenants; and
                    ``(I) capital expenditures to improve the security 
                and safety of residents.
            ``(2) Establishment of capital fund formula.--The Secretary 
        shall develop a formula for providing assistance under the 
        Capital Fund, which may take into account--
                    ``(A) the number of public housing dwelling units 
                owned or operated by the public housing agency and the 
                percentage of those units that are occupied by very 
                low-income families;
                    ``(B) if applicable, the reduction in the number of 
                public housing units owned or operated by the public 
                housing agency as a result of any conversion to a 
                system of tenant-based assistance;
                    ``(C) the costs to the public housing agency of 
                meeting the rehabilitation and modernization needs, and 
                meeting the reconstruction, development, and demolition 
                needs of public housing dwelling units owned and 
                operated by the public housing agency;
                    ``(D) the degree of household poverty served by the 
                public housing agency;
                    ``(E) the costs to the public housing agency of 
                providing a safe and secure environment in public 
                housing units owned and operated by the public housing 
                agency; and
                    ``(F) the ability of the public housing agency to 
                effectively administer the Capital Fund distribution of 
                the public housing agency.
    ``(d) Operating Fund.--
            ``(1) In general.--The Secretary shall establish an 
        Operating Fund for the purpose of making assistance available 
        to public housing agencies for the operation and management of 
        public housing, including--
                    ``(A) procedures and systems to maintain and ensure 
                the efficient management and operation of public 
                housing units;
                    ``(B) activities to ensure a program of routine 
                preventative maintenance;
                    ``(C) anticrime and antidrug activities, including 
                the costs of providing adequate security for public 
                housing tenants;
                    ``(D) activities related to the provision of 
                services, including service coordinators for elderly 
                persons or persons with disabilities;
                    ``(E) activities to provide for management and 
                participation in the management of public housing by 
                public housing tenants;
                    ``(F) the costs associated with the operation and 
                management of mixed-income projects, to the extent 
                appropriate (including the funding of an operating 
                reserve to ensure affordability for low-income families 
                in lieu of the availability of operating funds for 
                public housing units in a mixed-income project);
                    ``(G) the reasonable costs of insurance;
                    ``(H) the reasonable energy costs associated with 
                public housing units, with an emphasis on energy 
                conservation; and
                    ``(I) the costs of administering a public housing 
                work program under section 12, including the costs of 
                any related insurance needs.
            ``(2) Establishment of operating fund formula.--The 
        Secretary shall establish a formula for providing assistance 
        under the Operating Fund, which may take into account--
                    ``(A) standards for the costs of operation and 
                reasonable projections of income, taking into account 
                the character and location of the public housing 
                project and characteristics of the families served, or 
                the costs of providing comparable services as 
                determined with criteria or a formula representing the 
                operations of a prototype well-managed public housing 
                project;
                    ``(B) the number of public housing dwelling units 
                owned and operated by the public housing agency, the 
                percentage of those units that are occupied by very 
                low-income families, and, if applicable, the reduction 
                in the number of public housing units as a result of 
                any conversion to a system of tenant-based assistance;
                    ``(C) the degree of household poverty served by a 
                public housing agency;
                    ``(D) the extent to which the public housing agency 
                provides programs and activities designed to promote 
                the economic self-sufficiency and management skills of 
                public housing tenants;
                    ``(E) the number of dwelling units owned and 
                operated by the public housing agency that are 
                chronically vacant and the amount of assistance 
                appropriate for those units;
                    ``(F) the costs of the public housing agency 
                associated with anticrime and antidrug activities, 
                including the costs of providing adequate security for 
                public housing tenants; and
                    ``(G) the ability of the public housing agency to 
                effectively administer the Operating Fund distribution 
                of the public housing agency.
    ``(e) Limitations on Use of Funds.--
            ``(1) In general.--Each public housing agency may use not 
        more than 20 percent of the Capital Fund distribution of the 
        public housing agency for activities that are eligible for 
        assistance under the Operating Fund under subsection (d), if 
        the public housing agency plan provides for such use.
            ``(2) New construction.--
                    ``(A) In general.--A public housing agency may not 
                use any of the Capital Fund or Operating Fund 
                distributions of the public housing agency for the 
                purpose of constructing any public housing unit, if 
                such construction would result in a net increase in the 
                number of public housing units owned or operated by the 
                public housing agency on the date of enactment of the 
                Public Housing Reform and Empowerment Act of 1995, 
                including any public housing units demolished as part 
                of any revitalization effort.
                    ``(B) Exception.--Notwithstanding subparagraph (A), 
                a public housing agency may use the Capital Fund or 
                Operating Fund distributions of the public housing 
                agency for the construction and operation of housing 
                units that are available and affordable to low-income 
                families in excess of the limitations on new 
                construction set forth in subparagraph (A), except that 
                the formulae established under subsections (c)(2) and 
                (d)(2) shall not provide additional funding for the 
                specific purpose of allowing construction and operation 
                of housing in excess of those limitations.''.
    ``(f) Operating and Capital Assistance to Resident Management 
Corporations.--The Secretary shall directly provide operating and 
capital assistance under this section to each resident management 
corporation managing a public housing project pursuant to a contract 
under this section, which assistance shall be used for purposes of 
operating the public housing project and performing such other eligible 
activities with respect to the project as may be provided under the 
contract.
    ``(g) Indian Housing Programs.--To the extent provided in advance 
in appropriations Acts, the Secretary shall carry out housing programs 
for Indians in accordance with such formulas and programs as the 
Secretary shall establish by regulation.
    ``(h) Technical Assistance.--To the extent approved in advance in 
appropriations Acts, the Secretary may make grants or enter into 
contracts in accordance with this subsection for purposes of providing, 
either directly or indirectly--
            ``(1) technical assistance to public housing agencies, 
        resident councils, resident organizations, and resident 
        management corporations, including assistance relating to 
        monitoring and inspections;
            ``(2) training for public housing agency employees and 
        tenants;
            ``(3) data collection and analysis; and
            ``(4) training, technical assistance, and education to 
        assist public housing agencies that are--
                    ``(A) at risk of being designated as troubled under 
                section 6(j) from being so designated; and
                    ``(B) designated as troubled under section 6(j) in 
                achieving the removal of that designation.
    ``(i) Emergency Reserve.--
            ``(1) In general.--
                    ``(A) Set-aside.--In each fiscal year, the 
                Secretary shall set aside not more than 2 percent of 
                the amount made available for use under the capital 
                fund to carry out this section for that fiscal year for 
                use in accordance with this subsection.
                    ``(B) Use of funds.--
                            ``(i) Emergencies.--Amounts set aside under 
                        this paragraph shall be available to the 
                        Secretary for use in connection with 
                        emergencies, as determined by the Secretary, 
                        and in connection with housing needs resulting 
                        from any settlement of litigation.
                            ``(ii) Additional funds.--To the extent 
                        that there are funds from amounts set aside 
                        under this paragraph in excess to the needs 
                        described in clause (i), the Secretary may use 
                        those funds for the costs of establishing and 
                        administering a witness relocation program, 
                        which shall be established by the Secretary in 
                        conjunction with the Attorney General of the 
                        United States.
            ``(2) Allocation.--
                    ``(A) In general.--Amounts set aside under this 
                subsection shall initially be allocated based on the 
                emergency and litigation settlement needs of public 
                housing agencies, in such manner, and in such amounts 
                as the Secretary shall determine.
                    ``(B) Publication.--The Secretary shall publish the 
                use of any amounts allocated under this subsection in 
                the Federal Register.''.
    (b) Implementation; Effective Date; Transition Period.--
            (1) Implementation.--Not later than 1 year after the date 
        of enactment of this Act, in accordance with the negotiated 
        rulemaking procedures set forth in subchapter III of chapter 5 
        of title 5, United States Code, the Secretary shall establish 
        the formulas described in subsections (c)(3) and (d)(2) of 
        section 9 of the Public Housing Reform and Empowerment Act of 
        1995, as amended by this section.
            (2) Effective date.--The formulas established under 
        paragraph (1) shall be effective only with respect to amounts 
        made available under section 9 of the United States Housing Act 
        of 1937, as amended by this section, in fiscal year 1998 or in 
        any succeeding fiscal year.
            (3) Transition period.--Prior to the effective date 
        described in paragraph (2), the Secretary shall provide that 
        each public housing agency shall receive funding under sections 
        9 and 14 of the United States Housing Act of 1937, as those 
        sections existed on the day before the date of enactment of 
        this Act.
    (c) Drug Elimination Grants.--
            (1) Funding authorization.--
                    (A) In general.--To the extent provided in advance 
                in appropriations Acts for fiscal years 1996 and 1997, 
                the Secretary shall make grants for--
                            (i) use in eliminating drug-related crime 
                        under the Public and Assisted Housing Drug 
                        Elimination Act of 1990; and
                            (ii) drug elimination clearinghouse 
                        services authorized by section 5143 of the 
                        Drug-Free Public Housing Act of 1988.
                    (B) Set-aside.--Of any amounts made available to 
                carry out subparagraph (A), the Secretary shall set 
                aside amounts for grants, technical assistance, 
                contracts, and other assistance, and for training, 
                program assessment, and execution for or on behalf of 
                public housing agencies and resident organizations 
                (including the cost of necessary travel for 
                participants in such training).
            (2) Program requirements.--The use of amounts made 
        available under paragraph (1) shall be governed by the Public 
        and Assisted Housing Drug Elimination Act of 1990, except as 
        follows:
                    (A) Formula allocation.--Notwithstanding the Public 
                and Assisted Housing Drug Elimination Act of 1990, 
                after setting aside amounts for assisted housing under 
                section 5130(b) of such Act, the Secretary may make 
                grants to public housing agencies in accordance with a 
                formula established by the Secretary, which shall--
                            (i) take into account the needs of the 
                        public housing agency for anticrime funding, 
                        and the amount of funding that the public 
                        housing agency has received under the Public 
                        and Assisted Housing Drug Elimination Act of 
                        1990 during fiscal years 1993, 1994, and 1995; 
                        and
                            (ii) not exclude an eligible public housing 
                        agency that has not received funding during the 
                        period described in clause (i).
                    (B) Other types of crime.--For purposes of this 
                subsection, the Secretary may define the term ``drug-
                related crime'' to include criminal actions other than 
                those described in section 5126(2) of the Public and 
                Assisted Housing Drug Elimination Act of 1990.
            (3) Sunset.--No grant may be made under this subsection on 
        or after October 1, 1998.

SEC. 111. LABOR STANDARDS.

    Section 12 of the United States Housing Act of 1937 (42 U.S.C. 
1437j) is amended by adding at the end the following new subsection:
    ``(c) Work Requirement.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, each adult member of each family assisted under this title 
        shall contribute not less than 8 hours of volunteer work per 
        month (not to include any political activity) within the 
        community in which that adult resides.
            ``(2) Inclusion in plan.--Each public housing agency shall 
        include in the public housing agency plan a detailed 
        description of the manner in which the public housing agency 
        intends to implement and administer paragraph (1).
            ``(3) Exemptions.--The Secretary may provide an exemption 
        from paragraph (1) for any adult who is--
                    ``(A) not less than 62 years of age;
                    ``(B) a person with disabilities who is unable, as 
                determined in accordance with guidelines established by 
                the Secretary, to comply with this section;
                    ``(C) working not less than 20 hours per week, a 
                student, receiving vocational training, or otherwise 
                meeting work, training, or educational requirements of 
                a public assistance program; or
                    ``(D) a single parent or the spouse of an otherwise 
                exempt individual who is the primary caretaker of one 
                or more children who are 6 years of age or younger.''.

SEC. 112. REPEAL OF ENERGY CONSERVATION; CONSORTIA AND JOINT VENTURES.

    Section 13 of the United States Housing Act of 1937 (42 U.S.C. 
1437k) is amended to read as follows:

``SEC. 13. CONSORTIA, JOINT VENTURES, AFFILIATES, AND SUBSIDIARIES OF 
              PUBLIC HOUSING AGENCIES.

    ``(a) Consortia.--
            ``(1) In general.--Any 2 or more public housing agencies 
        may participate in a consortium for the purpose of 
        administering any or all of the housing programs of those 
        public housing agencies in accordance with this section.
            ``(2) Effect.--With respect to any consortium described in 
        paragraph (1)--
                    ``(A) any assistance made available under this 
                title to each of the public housing agencies 
                participating in the consortium shall be paid to the 
                consortium; and
                    ``(B) all planning and reporting requirements 
                imposed upon each public housing agency participating 
                in the consortium with respect to the programs operated 
                by the consortium shall be consolidated.
            ``(3) Restrictions.--
                    ``(A) Agreement.--Each consortium described in 
                paragraph (1) shall be formed and operated in 
                accordance with a consortium agreement, and shall be 
                subject to the requirements of a joint public housing 
                agency plan, which shall be submitted by the consortium 
                in accordance with section 5A.
                    ``(B) Minimum requirements.--The Secretary shall 
                specify minimum requirements relating to the formation 
                and operation of consortia and the minimum contents of 
                consortium agreements under this paragraph.
    ``(b) Joint Ventures.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, a public housing agency, in accordance with the public 
        housing agency plan, may--
                    ``(A) form and operate wholly owned or controlled 
                subsidiaries (which may be nonprofit corporations) and 
                other affiliates, any of which may be directed, 
                managed, or controlled by the same persons who 
                constitute the board of commissioners or other similar 
                governing body of the public housing agency, or who 
                serve as employees or staff of the public housing 
                agency; or
                    ``(B) enter into joint ventures, partnerships, or 
                other business arrangements with, or contract with, any 
                person, organization, entity, or governmental unit, 
                with respect to the administration of the programs of 
                the public housing agency, including any program that 
                is subject to this title.
            ``(2) Use of income.--Any income generated under paragraph 
        (1) shall be used for low-income housing or to benefit the 
        tenants of the public housing agency.
            ``(3) Audits.--The Comptroller General of the United 
        States, the Secretary, and the Inspector General of the 
        Department of Housing and Urban Development may conduct an 
        audit of any activity undertaken under paragraph (1) at any 
        time.''.

SEC. 113. REPEAL OF MODERNIZATION FUND.

    (a) In General.--Section 14 of the United States Housing Act of 
1937 (42 U.S.C. 1437l) is repealed.
    (b) Conforming Amendments.--The United States Housing Act of 1937 
(42 U.S.C. 1437 et seq.) is amended--
            (1) in section 5(c)(5), by striking ``for use under section 
        14 or'';
            (2) in section 5(c)(7)--
                    (A) in subparagraph (A)--
                            (i) by striking clause (iii); and
                            (ii) by redesignating clauses (iv) through 
                        (x) as clauses (iii) through (ix), 
                        respectively; and
                    (B) in subparagraph (B)--
                            (i) by striking clause (iii); and
                            (ii) by redesignating clauses (iv) through 
                        (x) as clauses (iii) through (ix), 
                        respectively;
            (3) in section 6(j)(1)--
                    (A) by striking subparagraph (B); and
                    (B) by redesignating subparagraphs (C) through (H) 
                as subparagraphs (B) through (G), respectively;
            (4) in section 6(j)(2)(A)--
                    (A) in clause (i), by striking ``The Secretary 
                shall also designate,'' and all that follows through 
                the period at the end; and
                    (B) in clause (iii), by striking ``(including 
                designation as a troubled agency for purposes of the 
                program under section 14)'';
            (5) in section 6(j)(2)(B)--
                    (A) in clause (i), by striking ``and determining 
                that an assessment under this subparagraph will not 
                duplicate any review conducted under section 14(p)''; 
                and
                    (B) in clause (ii)--
                            (i) by striking ``(I) the agency's 
                        comprehensive plan prepared pursuant to section 
                        14 adequately and appropriately addresses the 
                        rehabilitation needs of the agency's inventory, 
                        (II)'' and inserting ``(I)''; and
                            (ii) by striking ``(III)'' and inserting 
                        ``(II)'';
            (6) in section 6(j)(3)--
                    (A) in clause (ii), by adding ``and'' at the end;
                    (B) by striking clause (iii); and
                    (C) by redesignating clause (iv) as clause (iii);
            (7) in section 6(j)(4)--
                    (A) in subparagraph (D), by adding ``and'' at the 
                end;
                    (B) in subparagraph (E), by striking ``; and'' at 
                the end and inserting a period; and
                    (C) by striking subparagraph (F);
            (8) in section 20--
                    (A) by striking subsection (c) and inserting the 
                following:
    ``(c) [Reserved.]''; and
                    (B) by striking subsection (f) and inserting the 
                following:
    ``(f) [Reserved.]'';
            (9) in section 21(a)(2)--
                    (A) by striking subparagraph (A); and
                    (B) by redesignating subparagraphs (B) and (C) as 
                subparagraphs (A) and (B), respectively;
            (10) in section 21(a)(3)(A)(v), by striking ``the building 
        or buildings meet the minimum safety and livability standards 
        applicable under section 14, and'';
            (11) in section 25(b)(1), by striking ``From amounts 
        reserved'' and all that follows through ``the Secretary may'' 
        and inserting the following: To the extent approved in 
        appropriations Acts, the Secretary may'';
            (12) in section 25(e)(2)--
                    (A) by striking ``The Secretary'' and inserting 
                ``To the extent approved in appropriations Acts, the 
                Secretary''; and
                    (B) by striking ``available annually from amounts 
                under section 14'';
            (13) in section 25(e), by striking paragraph (3);
            (14) in section 25(f)(2)(G)(i), by striking ``including--'' 
        and all that follows through ``an explanation'' and inserting 
        ``including an explanation'';
            (15) in section 25(i)(1), by striking the second sentence; 
        and
            (16) in section 202(b)(2)--
                    (A) by striking ``(b) Financial Assistance.--'' and 
                all that follows through ``The Secretary may,'' and 
                inserting the following:
    ``(b) Financial Assistance.--The Secretary may''; and
                    (B) by striking paragraph (2).

SEC. 114. ELIGIBILITY FOR PUBLIC AND ASSISTED HOUSING.

    Section 16 of the United States Housing Act of 1937 (42 U.S.C. 
1437n) is amended to read as follows:

``SEC. 16. ELIGIBILITY FOR PUBLIC AND ASSISTED HOUSING.

    ``(a) Income Eligibility for Public Housing.--
            ``(1) In general.--Of the dwelling units of a public 
        housing agency, including public housing units in a designated 
        mixed-income project, made available for occupancy in any 
        fiscal year of the public housing agency--
                    ``(A) not less than 40 percent shall be occupied by 
                families whose incomes do not exceed 30 percent of the 
                area median income for those families;
                    ``(B) not less than 75 percent shall be occupied by 
                families whose incomes do not exceed 60 percent of the 
                area median income for those families; and
                    ``(C) any remaining dwelling units may be made 
                available for families whose incomes do not exceed 80 
                percent of the area median income for those families.
            ``(2) Establishment of different standards.--
        Notwithstanding paragraph (1), if approved by the Secretary, a 
        public housing agency, in accordance with the public housing 
        agency plan, may for good cause establish and implement an 
        occupancy standard other than the standard described in 
        paragraph (1).
            ``(3) Mixed-income housing standard.--Each public housing 
        agency plan submitted by a public housing agency shall include 
        a plan for achieving a diverse income mix among tenants in each 
        public housing project of the public housing agency and among 
        the scattered site public housing of the public housing agency.
    ``(b) Income Eligibility for Certain Assisted Housing.--
            ``(1) In general.--Of the dwelling units receiving tenant-
        based assistance under section 8 made available for occupancy 
        in any fiscal year of the public housing agency--
                    ``(A) not less than 50 percent shall be occupied by 
                families whose incomes do not exceed 30 percent of the 
                area median income for those families; and
                    ``(B) any remaining dwelling units may be made 
                available for families whose incomes do not exceed 80 
                percent of the area median income for those families.
            ``(2) Establishment of different standards.--
        Notwithstanding paragraph (1), if approved by the Secretary, a 
        public housing agency, in accordance with the public housing 
        agency plan, may for good cause establish and implement an 
        occupancy standard other than the standard described in 
        paragraph (1).
    ``(c) Ineligibility of Illegal Drug Users and Alcohol Abusers.--
Notwithstanding any other provision of law, a public housing agency 
shall establish standards for occupancy in public housing dwelling 
units--
            ``(1) that prohibit occupancy in any such unit by any 
        person--
                    ``(A) who the public housing agency determines is 
                illegally using a controlled substance; or
                    ``(B) if the public housing agency determines that 
                it has reasonable cause to believe that such person's 
                illegal use (or pattern of illegal use) of a controlled 
                substance, or abuse (or pattern of abuse) of alcohol, 
                could interfere with the health, safety, or right to 
                peaceful enjoyment of the premises by the tenants of 
                the public housing project; and
            ``(2) that allow the public housing agency to terminate the 
        tenancy in any public housing unit of any person--
                    ``(A) if the public housing agency determines that 
                such person is illegally using a controlled substance; 
                or
                    ``(B) whose illegal use of a controlled substance, 
                or whose abuse of alcohol, is determined by the public 
                housing agency to interfere with the health, safety, or 
                right to peaceful enjoyment of the premises by the 
                tenants of the public housing project.
    ``(d) Inapplicability to Indian Housing.--This section does not 
apply to any dwelling unit assisted by an Indian housing authority.''.

SEC. 115. DEMOLITION AND DISPOSITION OF PUBLIC HOUSING.

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

``SEC. 18. DEMOLITION AND DISPOSITION OF PUBLIC HOUSING.

    ``(a) Applications for Demolition and Disposition.--Except as 
provided in subsection (b), not later than 60 days after receiving an 
application by a public housing agency for authorization, with or 
without financial assistance under this title, to demolish or dispose 
of a public housing project or a portion of a public housing project 
(including any transfer to a resident-supported nonprofit entity), the 
Secretary shall approve the application, if the public housing agency 
certifies--
            ``(1) in the case of--
                    ``(A) an application proposing demolition of a 
                public housing project or a portion of a public housing 
                project, that--
                            ``(i) the project or portion of the public 
                        housing project is obsolete as to physical 
                        condition, location, or other factors, making 
                        it unsuitable for housing purposes; and
                            ``(ii) no reasonable program of 
                        modifications is cost-effective to return the 
                        public housing project or portion of the 
                        project to useful life; and
                    ``(B) an application proposing the demolition of 
                only a portion of a public housing project, that the 
                demolition will help to assure the viability of the 
                remaining portion of the project;
            ``(2) in the case of an application proposing disposition 
        of a public housing project or other real property subject to 
        this title by sale or other transfer, that--
                    ``(A) the retention of the property is not in the 
                best interests of the tenants or the public housing 
                agency because--
                            ``(i) conditions in the area surrounding 
                        the public housing project adversely affect the 
                        health or safety of the tenants or the feasible 
                        operation of the project by the public housing 
                        agency; or
                            ``(ii) disposition allows the acquisition, 
                        development, or rehabilitation of other 
                        properties that will be more efficiently or 
                        effectively operated as low-income housing;
                    ``(B) the public housing agency has otherwise 
                determined the disposition to be appropriate for 
                reasons that are--
                            ``(i) in the best interests of the tenants 
                        and the public housing agency;
                            ``(ii) consistent with the goals of the 
                        public housing agency and the public housing 
                        agency plan; and
                            ``(iii) otherwise consistent with this 
                        title; or
                    ``(C) for property other than dwelling units, the 
                property is excess to the needs of a public housing 
                project or the disposition is incidental to, or does 
                not interfere with, continued operation of a public 
                housing project;
            ``(3) that the public housing agency has specifically 
        authorized the demolition or disposition in the public housing 
        agency plan, and has certified that the actions contemplated in 
        the public housing agency plan comply with this section;
            ``(4) that the public housing agency--
                    ``(A) will provide for the payment of the 
                relocation expenses of each tenant to be displaced;
                    ``(B) will ensure that the amount of rent paid by 
                the tenant following relocation will not exceed the 
                amount permitted under this title; and
                    ``(C) will not commence demolition or complete 
                disposition until all tenants residing in the unit are 
                relocated;
            ``(5) that the net proceeds of any disposition will be 
        used--
                    ``(A) unless waived by the Secretary, for the 
                retirement of outstanding obligations issued to finance 
                the original public housing project or modernization of 
                the project; and
                    ``(B) to the extent that any proceeds remain after 
                the application of proceeds in accordance with 
                subparagraph (A), for the provision of low-income 
                housing or to benefit the tenants of the public housing 
                agency; and
            ``(6) that the public housing agency has complied with 
        subsection (c).
    ``(b) Disapproval of Applications.--The Secretary shall disapprove 
an application submitted under subsection (a) if the Secretary 
determines that any certification made by the public housing agency 
under that subsection is clearly inconsistent with information and data 
available to the Secretary.
    ``(c) Tenant Opportunity To Purchase in Case of Proposed 
Disposition.--
            ``(1) In general.--In the case of a proposed disposition of 
        a public housing project or portion of a project, the public 
        housing agency shall, in appropriate circumstances, as 
        determined by the Secretary, initially offer the property to 
        any eligible resident organization, eligible resident 
        management corporation, or nonprofit organization supported by 
        the residents, if that entity has expressed an interest, in 
        writing, to the public housing agency in a timely manner, in 
        purchasing the property for continued use as low-income 
        housing.
            ``(2) Timing.--
                    ``(A) Thirty-day notice.--A resident organization, 
                resident management corporation, or other resident-
                supported nonprofit entity referred to in paragraph (1) 
                may express interest in purchasing property that is the 
                subject of a disposition, as described in paragraph 
                (1), during the 30-day period beginning on the date of 
                notification of a proposed sale of the property.
                    ``(B) Sixty-day notice.--If an entity expresses 
                written interest in purchasing a property, as provided 
                in subparagraph (A), no disposition of the property 
                shall occur during the 60-day period beginning on the 
                date of receipt of that written notice, during which 
                time that entity shall be given the opportunity to 
                obtain a firm commitment for financing the purchase of 
                the property.
    ``(d) Replacement Units.--Notwithstanding any other provision of 
law, replacement housing units for public housing units demolished in 
accordance with this section may be built on the original public 
housing location or in the same neighborhood as the original public 
housing location if the number of those replacement units is fewer than 
the number of units demolished.''.
    (b) Homeownership Replacement Plan.--
            (1) In general.--Section 304(g) of the United States 
        Housing Act of 1937 (42 U.S.C. 1437aaa-3(g)), as amended by 
        section 1002(b) of the Emergency Supplemental Appropriations 
        for Additional Disaster Assistance, for Anti-terrorism 
        Initiatives, for Assistance in the Recovery from the Tragedy 
        that Occurred At Oklahoma City, and Rescissions Act, 1995, is 
        amended to read as follows:
    ``(g) [Reserved.]''.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall be effective with respect to any plan for the demolition, 
        disposition, or conversion to homeownership of public housing 
        that is approved by the Secretary after September 30, 1995.
    (c) Uniform Relocation and Real Property Acquisition Act.--The 
Uniform Relocation and Real Property Acquisition Act shall not apply to 
activities under section 18 of the United States Housing Act of 1937, 
as amended by this section.

SEC. 116. REPEAL OF FAMILY INVESTMENT CENTERS; VOUCHER SYSTEM FOR 
              PUBLIC HOUSING.

    (a) In General.--Section 22 of the United States Housing Act of 
1937 (42 U.S.C. 1437t) is amended to read as follows:

``SEC. 22. VOUCHER SYSTEM FOR PUBLIC HOUSING.

    ``(a) In General.--
            ``(1) Authorization.--A public housing agency may convert 
        any public housing project (or portion thereof) owned and 
        operated by the public housing agency to a system of tenant-
        based assistance in accordance with this section.
            ``(2) Requirements.--In converting to a tenant-based system 
        of assistance under this section, the public housing agency 
        shall develop a conversion assessment and plan under subsection 
        (b) in consultation with the appropriate public officials, with 
        significant participation by the residents of the project (or 
        portion thereof), which assessment and plan shall--
                    ``(A) be consistent with and part of the public 
                housing agency plan; and
                    ``(B) describe the conversion and future use or 
                disposition of the public housing project, including an 
                impact analysis on the affected community.
    ``(b) Conversion Assessment and Plan.--
            ``(1) In general.--Not later than 2 years after the date of 
        enactment of the Public Housing Reform and Empowerment Act of 
        1995, each public housing agency shall assess the status of 
        each public housing project owned and operated by that public 
        housing agency, and shall submit to the Secretary an assessment 
        that includes--
                    ``(A) a cost analysis that demonstrates whether or 
                not the cost (both on a net present value basis and in 
                terms of new budget authority requirements) of 
                providing tenant-based assistance under section 8 for 
                the same families in substantially similar dwellings 
                over the same period of time is less expensive than 
                continuing public housing assistance in the public 
                housing project proposed for conversion for the 
                remaining useful life of the project;
                    ``(B) an analysis of the market value of the public 
                housing project proposed for conversion both before and 
                after rehabilitation, and before and after conversion;
                    ``(C) an analysis of the rental market conditions 
                with respect to the likely success of tenant-based 
                assistance under section 8 in that market for the 
                specific residents of the public housing project 
                proposed for conversion, including an assessment of the 
                availability of decent and safe dwellings renting at or 
                below the payment standard established for tenant-based 
                assistance under section 8 by the public housing 
                agency;
                    ``(D) the impact of the conversion to a system of 
                tenant-based assistance under this section on the 
                neighborhood in which the public housing project is 
                located; and
                    ``(E) a plan that identifies actions, if any, that 
                the public housing agency would take with regard to 
                converting any public housing project or projects (or 
                portions thereof) of the public housing agency to a 
                system of tenant-based assistance.
            ``(2) Streamlined assessment.--At the discretion of the 
        Secretary or at the request of a public housing agency, the 
        Secretary may waive any or all of the requirements of paragraph 
        (1) or otherwise require a streamlined assessment with respect 
        to any public housing project or class of public housing 
        projects.
            ``(3) Implementation of conversion plan.--
                    ``(A) In general.--A public housing agency may 
                implement a conversion plan only if the conversion 
                assessment under this section demonstrates that the 
                conversion--
                            ``(i) will not be more expensive than 
                        continuing to operate the public housing 
                        project (or portion thereof) as public housing; 
                        and
                            ``(ii) will principally benefit the 
                        residents of the public housing project (or 
                        portion thereof) to be converted, the public 
                        housing agency, and the community.
                    ``(B) Disapproval.--The Secretary shall disapprove 
                a conversion plan only if the plan is plainly 
                inconsistent with the conversion assessment under 
                subsection (b) or if there is reliable information and 
                data available to the Secretary that contradicts that 
                conversion assessment.
    ``(c) Other Requirements.--To the extent approved by the Secretary, 
the funds used by the public housing agency to provide tenant-based 
assistance under section 8 shall be added to the housing assistance 
payment contract administered by--
            ``(1) the public housing agency; or
            ``(2) any entity administering the contract on behalf of 
        the public housing agency.
    ``(d) Inapplicability to Indian Housing.--This section does not 
apply to any Indian housing authority.''.
    (b) Savings Provision.--The amendment made by subsection (a) does 
not affect any contract or other agreement entered into under section 
22 of the United States Housing Act of 1937, as that section existed on 
the day before the date of enactment of this Act.

SEC. 117. REPEAL OF FAMILY SELF-SUFFICIENCY; HOMEOWNERSHIP 
              OPPORTUNITIES.

    (a) In General.--Section 23 of the United States Housing Act of 
1937 (42 U.S.C. 1437u) is amended to read as follows:

``SEC. 23. PUBLIC HOUSING HOMEOWNERSHIP OPPORTUNITIES.

    ``(a) In General.--Notwithstanding any other provision of law, a 
public housing agency may, in accordance with this section--
            ``(1) sell any public housing unit in any public housing 
        project of the public housing agency to--
                    ``(A) the low-income tenants of the public housing 
                agency; or
                    ``(B) any organization serving as a conduit for 
                sales to those persons; and
            ``(2) provide assistance to public housing residents to 
        facilitate the ability of those residents to purchase a 
        principal residence.
    ``(b) Right of First Refusal.--In making any sale under this 
section, the public housing agency shall initially offer the public 
housing unit at issue to the tenant or tenants occupying that unit, if 
any, or to an organization serving as a conduit for sales to any such 
tenant.
    ``(c) Sale Prices, Terms, and Conditions.--Any sale under this 
section may involve such prices, terms, and conditions as the public 
housing agency may determine in accordance with procedures set forth in 
the public housing agency plan.
    ``(d) Purchase Requirements.--
            ``(1) In general.--Each tenant that purchases a dwelling 
        unit under subsection (a) shall, as of the date on which the 
        purchase is made--
                    ``(A) intend to occupy the property as a principal 
                residence; and
                    ``(B) submit a written certification to the public 
                housing agency that such tenant will occupy the 
                property as a principal residence for a period of not 
                less than 12 months beginning on that date.
            ``(2) Recapture.--Except for good cause, as determined by a 
        public housing agency in the public housing agency plan, if, 
        during the 1-year period beginning on the date on which any 
        tenant acquires a public housing unit under this section, that 
        public housing unit is resold, the public housing agency shall 
        recapture 75 percent of the amount of any proceeds from that 
        resale that exceed the sum of--
                    ``(A) the original sale price for the acquisition 
                of the property by the qualifying tenant;
                    ``(B) the costs of any improvements made to the 
                property after the date on which the acquisition 
                occurs; and
                    ``(C) any closing costs incurred in connection with 
                the acquisition.
    ``(e) Protection of Nonpurchasing Tenants.--If a public housing 
tenant does not exercise the right of first refusal under subsection 
(b) with respect to the public housing unit in which the tenant 
resides, the public housing agency shall--
            ``(1) ensure that either another public housing unit or 
        rental assistance under section 8 is made available to the 
        tenant; and
            ``(2) provide for the payment of the reasonable relocation 
        expenses of the tenant.
    ``(f) Net Proceeds.--
            ``(1) In general.--The net proceeds of any sales under this 
        section remaining after payment of all costs of the sale and 
        any unassumed, unpaid indebtedness owed in connection with the 
        dwelling units sold under this section unless waived by the 
        Secretary, shall be used for purposes relating to low-income 
        housing and in accordance with the public housing agency plan.
            ``(2) Indian housing.--The net proceeds described in 
        paragraph (1) may be used by Indian housing authorities for 
        housing for families whose incomes exceed the income levels 
        established under this title for low-income families.
    ``(g) Homeownership Assistance.--From amounts distributed to a 
public housing agency under section 9, or from other income earned by 
the public housing agency, the public housing agency may provide 
assistance to public housing residents to facilitate the ability of 
those residents to purchase a principal residence, including a 
residence other than a residence located in a public housing 
project.''.
    (b) Conforming Amendments.--The United States Housing Act of 1937 
(42 U.S.C. 1437 et seq.) is amended--
            (1) in section 8(y)(7)(A)--
                    (A) by striking ``, (ii)'' and inserting ``, and 
                (ii)''; and
                    (B) by striking ``, and (iii)'' and all that 
                follows before the period at the end; and
            (2) in section 25(l)(2)--
                    (A) in the first sentence, by striking ``, 
                consistent with the objectives of the program under 
                section 23,''; and
                    (B) by striking the second sentence.
    (c) Savings Provision.--The amendments made by this section do not 
affect any contract or other agreement entered into under section 23 of 
the United States Housing Act of 1937, as that section existed on the 
day before the date of enactment of this Act.

SEC. 118. REVITALIZING SEVERELY DISTRESSED PUBLIC HOUSING.

    Section 24 of the United States Housing Act of 1937 (42 U.S.C. 
1437v) is amended to read as follows:

``SEC. 24. REVITALIZING SEVERELY DISTRESSED PUBLIC HOUSING.

    ``(a) In General.--To the extent provided in advance in 
appropriations Acts, the Secretary may make grants to public housing 
agencies for the purposes of--
            ``(1) enabling the demolition of obsolete public housing 
        projects or portions thereof;
            ``(2) revitalizing sites (including remaining public 
        housing units) on which such public housing projects are 
        located;
            ``(3) the provision of replacement housing, which will 
        avoid or lessen concentrations of very low-income families; and
            ``(4) the provision of tenant-based assistance under 
        section 8 for use as replacement housing.
    ``(b) Competition.--The Secretary shall make grants under this 
section on the basis of a competition, which shall be based on such 
factors as--
            ``(1) the need for additional resources for addressing a 
        severely distressed public housing project;
            ``(2) the need for affordable housing in the community;
            ``(3) the supply of other housing available and affordable 
        to a family receiving tenant-based assistance under section 8; 
        and
            ``(4) the local impact of the proposed revitalization 
        program.
    ``(c) Terms and Conditions.--The Secretary may impose such terms 
and conditions on recipients of grants under this section as the 
Secretary determines to be appropriate to carry out the purposes of 
this section, except that such terms and conditions shall be similar to 
the terms and conditions of either--
            ``(1) the urban revitalization demonstration program 
        authorized under the Departments of Veterans Affairs and 
        Housing and Urban Development and Independent Agencies 
        Appropriations Acts; or
            ``(2) section 24 of the United States Housing Act of 1937, 
        as such section existed before the date of enactment of the 
        Public Housing Reform and Empower Act of 1995.
    ``(d) Alternative Management.--The Secretary may require any 
recipient of a grant under this section to make arrangements with an 
entity other than the public housing agency to carry out the purposes 
for which the grant was awarded, if the Secretary determines that such 
action is necessary for the timely and effective achievement of the 
purposes for which the grant was awarded.
    ``(e) Inapplicability to Indian Housing.--This section does not 
apply to any Indian housing authority.
    ``(f) Sunset.--No grant may be made under this section on or after 
October 1, 1998.''.

SEC. 119. MIXED-INCOME AND MIXED-OWNERSHIP PROJECTS.

    (a) In General.--The United States Housing Act of 1937 (42 U.S.C. 
1437 et seq.) is amended by adding at the end the following new 
section:

``SEC. 28. MIXED-INCOME AND MIXED-OWNERSHIP PROJECTS.

    ``(a) In General.--A public housing agency may own, operate, 
assist, or otherwise participate in one or more mixed-income projects 
in accordance with this section.
    ``(b) Requirements.--
            ``(1) Mixed-income project.--For purposes of this section, 
        the term `mixed-income project' means a project that meets the 
        requirements of paragraph (2) and that is occupied both by one 
        or more very low-income families and by one or more families 
        that are not very low-income families.
            ``(2) Structure of projects.--Each mixed-income project 
        shall be developed--
                    ``(A) in a manner that ensures that units are made 
                available in the project, by master contract, 
                individual lease, or equity interest for occupancy by 
                eligible families identified by the public housing 
                agency for a period of not less than 20 years;
                    ``(B) in a manner that ensures that the number of 
                public housing units bears approximately the same 
                proportion to the total number of units in the mixed-
                income project as the value of the total financial 
                commitment provided by the public housing agency bears 
                to the value of the total financial commitment in the 
                project, or shall not be less than the number of units 
                that could have been developed under the conventional 
                public housing program with the assistance; and
                    ``(C) in accordance with such other requirements as 
                the Secretary may prescribe by regulation.
            ``(3) Types of projects.--The term `mixed-income project' 
        includes a project that is developed--
                    ``(A) by a public housing agency or by an entity 
                affiliated with a public housing agency;
                    ``(B) by a partnership, a limited liability 
                company, or other entity in which the public housing 
                agency (or an entity affiliated with a public housing 
                agency) is a general partner, managing member, or 
                otherwise participates in the activities of that 
                entity;
                    ``(C) by any entity that grants to the public 
                housing agency the option to purchase the public 
                housing project during the 20-year period beginning on 
                the date of initial occupancy of the public housing 
                project in accordance with section 42(l)(7) of the 
                Internal Revenue Code of 1986; or
                    ``(D) in accordance with such other terms and 
                conditions as the Secretary may prescribe by 
                regulation.
    ``(c) Taxation.--
            ``(1) In general.--A public housing agency may elect to 
        have all public housing units in a mixed-income project subject 
        to local real estate taxes, except that such units shall be 
        eligible at the discretion of the public housing agency for the 
        taxing requirements under section 6(d).
            ``(2) Low-income housing tax credit.--With respect to any 
        unit in a mixed-income project that is assisted pursuant to the 
        low-income housing tax credit under section 42 of the Internal 
        Revenue Code of 1986, the rents charged to the tenants may be 
        set at levels not to exceed the amounts allowable under that 
        section.
    ``(d) Restriction.--No assistance provided under section 9 shall be 
used by a public housing agency in direct support of any unit rented to 
a family that is not a low-income family, except that this subsection 
does not apply to the Mutual Help Homeownership Program authorized 
under section 202 of this Act.
    ``(e) Effect of Certain Contract Terms.--If an entity that owns or 
operates a mixed-income project under this section enters into a 
contract with a public housing agency, the terms of which obligate the 
entity to operate and maintain a specified number of units in the 
project as public housing units in accordance with the requirements of 
this Act for the period required by law, such contractual terms may 
provide that, if, as a result of a reduction in appropriations under 
section 9, or any other change in applicable law, the public housing 
agency is unable to fulfill its contractual obligations with respect to 
those public housing units, that entity may deviate, under procedures 
and requirements developed through regulations by the Secretary, from 
otherwise applicable restrictions under this Act regarding rents, 
income eligibility, and other areas of public housing management with 
respect to a portion or all of those public housing units, to the 
extent necessary to preserve the viability of those units while 
maintaining the low-income character thereof to the maximum extent 
practicable.''.
    (b) Regulations.--The Secretary shall issue such regulations as may 
be necessary to promote the development of mixed-income projects, as 
that term is defined in section 28 of the United States Housing Act of 
1937, as added by this Act.

SEC. 120. CONVERSION OF DISTRESSED PUBLIC HOUSING TO TENANT-BASED 
              ASSISTANCE.

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

``SEC. 29. CONVERSION OF DISTRESSED PUBLIC HOUSING TO TENANT-BASED 
              ASSISTANCE.

    ``(a) Identification of Units.--To the extent approved in advance 
in appropriations Acts, each public housing agency shall identify all 
public housing projects of the public housing agency--
            ``(1) that are on the same or contiguous sites;
            ``(2) that the public housing agency determines to be 
        distressed, which determination shall be made in accordance 
        with guidelines established by the Secretary, which guidelines 
        shall be based on the criteria established in the Final Report 
        of the National Commission on Severely Distressed Public 
        Housing (August 1992);
            ``(3) identified as distressed housing under paragraph (2) 
        for which the public housing agency cannot assure the long-term 
        viability as public housing through reasonable modernization 
        expenses, density reduction, achievement of a broader range of 
        family income, or other measures; and
            ``(4) for which the estimated cost, during the remaining 
        useful life of the project, of continued operation and 
        modernization as public housing exceeds the estimated cost, 
        during the remaining useful life of the project, of providing 
        tenant-based assistance under section 8 for all families in 
        occupancy, based on appropriate indicators of cost (such as the 
        percentage of total development costs required for 
        modernization).
    ``(b) Consultation.--Each public housing agency shall consult with 
the appropriate public housing tenants and the appropriate unit of 
general local government in identifying any public housing projects 
under subsection (a).
    ``(c) Removal of Units From the Inventories of Public Housing 
Agencies.--
            ``(1) In general.--
                    ``(A) Development of plan.--Each public housing 
                agency shall develop and, to the extent provided in 
                advance in appropriations Acts, carry out a 5-year plan 
                in conjunction with the Secretary for the removal of 
                public housing units identified under subsection (a) 
                from the inventory of the public housing agency and the 
                annual contributions contract.
                    ``(B) Approval of plan.--The plan required under 
                subparagraph (A) shall--
                            ``(i) be included as part of the public 
                        housing agency plan;
                            ``(ii) be certified by the relevant local 
                        official to be in accordance with the 
                        comprehensive housing affordability strategy 
                        under title I of the Housing and Community 
                        Development Act of 1992; and
                            ``(iii) include a description of any 
                        disposition and demolition plan for the public 
                        housing units.
            ``(2) Extensions.--The Secretary may extend the 5-year 
        deadline described in paragraph (1) by not more than an 
        additional 5 years if the Secretary makes a determination that 
        the deadline is impracticable.
    ``(d) Conversion to Tenant-Based Assistance.--
            ``(1) In general.--With respect to any public housing 
        project that has not received a grant for assistance under the 
        urban revitalization demonstration program authorized under the 
        Departments of Veterans Affairs and Housing and Urban 
        Development and Independent Agencies Appropriations Acts or 
        under section 24 of the United States Housing Act of 1937, the 
        Secretary shall make authority available to a public housing 
        agency to provide assistance under this Act to families 
        residing in any public housing project that is removed from the 
        inventory of the public housing agency and the annual 
        contributions contract pursuant to this section.
            ``(2) Plan requirements.--Each plan under subsection (c) 
        shall require the agency to--
                    ``(A) notify families residing in the public 
                housing project, consistent with any guidelines issued 
                by the Secretary governing such notifications, that--
                            ``(i) the public housing project will be 
                        removed from the inventory of the public 
                        housing agency; and
                            ``(ii) the families displaced by such 
                        action will receive tenant-based or project-
                        based assistance or occupancy in a unit 
                        operated or assisted by the public housing 
                        agency;
                    ``(B) provide any necessary counseling for families 
                displaced by such action; and
                    ``(C) provide any reasonable relocation expenses 
                for families displaced by such action.
    ``(e) Removal by Secretary.--The Secretary shall take appropriate 
actions to ensure removal of any public housing project identified 
under subsection (a) from the inventory of a public housing agency, if 
the public housing agency fails to adequately develop a plan under 
subsection (c) with respect to that project, or fails to adequately 
implement such plan in accordance with the terms of the plan.
    ``(f) Administration.--
            ``(1) In general.--The Secretary may require a public 
        housing agency to provide to the Secretary or to public housing 
        tenants such information as the Secretary considers to be 
        necessary for the administration of this section.
            ``(2) Applicability of section 18.--Section 18 does not 
        apply to the demolition of public housing projects removed from 
        the inventory of the public housing agency under this section.
    ``(g) Inapplicability to Indian Housing.--This section does not 
apply to any Indian housing authority.''.

SEC. 121. PUBLIC HOUSING MORTGAGES AND SECURITY INTERESTS.

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

``SEC. 30. PUBLIC HOUSING MORTGAGES AND SECURITY INTERESTS.

    ``(a) General Authorization.--The Secretary may, upon such terms 
and conditions as the Secretary may prescribe, authorize a public 
housing agency to mortgage or otherwise grant a security interest in 
any public housing project or other property of the public housing 
agency.
    ``(b) Terms and Conditions.--
            ``(1) Criteria for approval.--In making any authorization 
        under subsection (a), the Secretary may consider--
                    ``(A) the ability of the public housing agency to 
                use the proceeds of the mortgage or security interest 
                for low-income housing uses;
                    ``(B) the ability of the public housing agency to 
                make payments on the mortgage or security interest; and
                    ``(C) such other criteria as the Secretary may 
                specify.
            ``(2) Terms and conditions of mortgages and security 
        interests obtained.--Each mortgage or security interest granted 
        under this section shall be--
                    ``(A) for a term that--
                            ``(i) is consistent with the terms of 
                        private loans in the market area in which the 
                        public housing project or property at issue is 
                        located; and
                            ``(ii) does not exceed 30 years; and
                    ``(B) subject to conditions that are consistent 
                with the conditions to which private loans in the 
                market area in which the subject project or other 
                property is located are subject.
            ``(3) No full faith and credit.--No action taken under this 
        section shall result in any liability to the Federal 
        Government.''.

SEC. 122. LINKING SERVICES TO PUBLIC HOUSING RESIDENTS.

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

``SEC. 31. SERVICES FOR PUBLIC HOUSING RESIDENTS.

    ``(a) In General.--To the extent provided in advance in 
appropriations Acts, the Secretary may make grants to public housing 
agencies (including Indian housing authorities) on behalf of public 
housing residents, or directly to resident management corporations, 
resident councils, or resident organizations (including nonprofit 
entities supported by residents), for the purposes of providing a 
program of supportive services and resident empowerment activities to 
assist public housing residents in becoming economically self-
sufficient.
    ``(b) Eligible Activities.--Grantees under this section may use 
such amounts only for activities on or near the public housing agency 
or public housing project that are designed to promote the self-
sufficiency of public housing residents, including activities relating 
to--
            ``(1) physical improvements to a public housing project in 
        order to provide space for supportive services for residents;
            ``(2) the provision of service coordinators;
            ``(3) the provision of services related to work readiness, 
        including academic skills, job training, job search skills, 
        tutoring, adult literacy, transportation, and child care, 
        except that grants received under this section shall not 
        comprise more than 50 percent of the costs of providing such 
        services;
            ``(4) resident management activities; and
            ``(5) other activities designed to improve the economic 
        self-sufficiency of residents.
    ``(c) Funding Distribution.--
            ``(1) In general.--Except for amounts provided under 
        subsection (d), the Secretary may distribute amounts made 
        available under this section on the basis of a competition or a 
        formula, as appropriate.
            ``(2) Factors for distribution.--Factors for distribution 
        under paragraph (1) shall include--
                    ``(A) the demonstrated capacity of the applicant to 
                carry out a program of supportive services or resident 
                empowerment activities; and
                    ``(B) the ability of the applicant to leverage 
                additional resources for the provision of services.
    ``(d) Funding for Resident Councils.--Of amounts appropriated for 
activities under this section, not less than $25,000,000 shall be 
provided directly to resident councils, resident organizations, and 
resident management corporations.''.

SEC. 123. APPLICABILITY TO INDIAN HOUSING.

    In accordance with section 201(b)(2) of the United States Housing 
Act of 1937, except as otherwise provided in this Act, this title and 
the amendments made by this title shall apply to public housing 
developed or operated pursuant to a contract between the Secretary and 
an Indian housing authority, as that term is defined in section 3(b) of 
the United States Housing Act of 1937.

                 TITLE II--SECTION 8 RENTAL ASSISTANCE

SEC. 201. MERGER OF THE CERTIFICATE AND VOUCHER PROGRAMS.

    Section 8(o) of the United States Housing Act of 1937 (42 U.S.C. 
1437f(o)) is amended to read as follows:
    ``(o) Voucher Program.--
            ``(1) Payment standard.--
                    ``(A) In general.--The Secretary may provide 
                assistance to public housing agencies for tenant-based 
                assistance using a payment standard established in 
                accordance with subparagraph (B). The payment standard 
                shall be used to determine the monthly assistance that 
                may be paid for any family, as provided in paragraph 
                (2).
                    ``(B) Establishment of payment standard.--The 
                payment standard shall not exceed 120 percent of the 
                fair market rental established under subsection (c) and 
                shall be not less than 90 percent of that fair market 
                rental.
                    ``(C) Set-aside.--The Secretary may set aside not 
                more than 5 percent of the budget authority available 
                under this subsection as an adjustment pool. The 
                Secretary shall use amounts in the adjustment pool to 
                make adjusted payments to public housing agencies under 
                subparagraph (A), to ensure continued affordability, if 
                the Secretary determines that additional assistance for 
                such purpose is necessary, based on documentation 
                submitted by a public housing agency.
                    ``(D) Approval.--The Secretary may require a public 
                housing agency to submit the payment standard of the 
                public housing agency to the Secretary for approval.
                    ``(E) Review.--The Secretary--
                            ``(i) shall monitor rent burdens and review 
                        any payment standard that results in a 
                        significant percentage of the families 
                        occupying units of any size paying more than 30 
                        percent of adjusted income for rent; and
                            ``(ii) may require a public housing agency 
                        to modify the payment standard of the public 
                        housing agency based on the results of that 
                        review.
            ``(2) Amount of monthly assistance payment.--
                    ``(A) Families receiving tenant-based assistance; 
                rent does not exceed payment standard.--For a family 
                receiving tenant-based assistance under this title, if 
                the rent for that family (including the amount allowed 
                for tenant-paid utilities) does not exceed the payment 
                standard established under paragraph (1), the monthly 
                assistance payment to that family shall be equal to the 
                amount by which the rent exceeds the greatest of the 
                following amounts, rounded to the nearest dollar:
                            ``(i) Thirty percent of the monthly 
                        adjusted income of the family.
                            ``(ii) Ten percent of the monthly income of 
                        the family.
                            ``(iii) If the family is receiving payments 
                        for welfare assistance from a public agency and 
                        a part of those payments, adjusted in 
                        accordance with the actual housing costs of the 
                        family, is specifically designated by that 
                        agency to meet the housing costs of the family, 
                        the portion of those payments that is so 
                        designated.
                    ``(B) Families receiving tenant-based assistance; 
                rent exceeds payment standard.--For a family receiving 
                tenant-based assistance under this title, if the rent 
                for that family (including the amount allowed for 
                tenant-paid utilities) exceeds the payment standard 
                established under paragraph (1), the monthly assistance 
                payment to that family shall be equal to the amount by 
                which the applicable payment standard exceeds the 
                greatest of the following amounts, rounded to the 
                nearest dollar:
                            ``(i) Thirty percent of the monthly 
                        adjusted income of the family.
                            ``(ii) Ten percent of the monthly income of 
                        the family.
                            ``(iii) If the family is receiving payments 
                        for welfare assistance from a public agency and 
                        a part of those payments, adjusted in 
                        accordance with the actual housing costs of the 
                        family, is specifically designated by that 
                        agency to meet the housing costs of the family, 
                        the portion of those payments that is so 
                        designated.
                    ``(C) Families receiving project-based 
                assistance.--For a family receiving project-based 
                assistance under this title, the rent that the family 
                is required to pay shall be determined in accordance 
                with section 3(a)(1), and the amount of the housing 
                assistance payment shall be determined in accordance 
                with subsection (c)(3) of this section.
            ``(3) Forty percent limit.--At the time a family initially 
        receives tenant-based assistance under this title with respect 
        to any dwelling unit, the total amount that a family may be 
        required to pay for rent may not exceed 40 percent of the 
        monthly adjusted income of the family.
            ``(4) Eligible families.--At the time a family initially 
        receives assistance under this subsection, a family shall 
        qualify as--
                    ``(A) a very low-income family;
                    ``(B) a family previously assisted under this 
                title;
                    ``(C) a low-income family that meets eligibility 
                criteria specified by the public housing agency;
                    ``(D) a family that qualifies to receive a voucher 
                in connection with a homeownership program approved 
                under title IV of the Cranston-Gonzalez National 
                Affordable Housing Act; or
                    ``(E) a family that qualifies to receive a voucher 
                under section 223 or 226 of the Low-Income Housing 
                Preservation and Resident Homeownership Act of 1990.
            ``(5) Annual review of family income.--Each public housing 
        agency shall, not less frequently than annually, conduct a 
        review of the family income of each family receiving assistance 
        under this subsection.
            ``(6) Selection of families.--
                    ``(A) In general.--Each public housing agency may 
                establish local preferences consistent with the public 
                housing agency plan submitted by the public housing 
                agency under section 5A.
                    ``(B) Eviction for drug-related activity.--Any 
                individual or family evicted from housing assisted 
                under this subsection by reason of drug-related 
                criminal activity (as defined in subsection (f)(5)) 
                shall not be eligible for housing assistance under this 
                title during the 3-year period beginning on the date of 
                such eviction, unless the evicted tenant successfully 
                completes a rehabilitation program approved by the 
                public housing agency (which shall include a waiver for 
                any member of the family of an individual prohibited 
                from receiving assistance under this title whom the 
                public housing agency determines clearly did not 
                participate in and had no knowledge of that criminal 
                activity, or if the circumstances leading to the 
                eviction no longer exist).
                    ``(C) Selection of tenants.--The selection of 
                tenants shall be made by the owner of the dwelling 
                unit, subject to the annual contributions contract 
                between the Secretary and the public housing agency.
            ``(7) Lease.--Each housing assistance payment contract 
        entered into by the public housing agency and the owner of a 
        dwelling unit--
                    ``(A) shall provide that the screening and 
                selection of families for those units shall be the 
                function of the owner;
                    ``(B) shall provide that the lease between the 
                tenant and the owner shall be for a term of not less 
                than 1 year, except that the public housing agency may 
                approve a shorter term for an initial lease between the 
                tenant and the dwelling unit owner if the public 
                housing agency determines that such shorter term would 
                improve housing opportunities for the tenant;
                    ``(C) except as otherwise provided by the public 
                housing agency, may provide for a termination of the 
                tenancy of a tenant assisted under this subsection 
                after 1 year;
                    ``(D) shall provide that the dwelling unit owner 
                shall offer leases to tenants assisted under this 
                subsection that--
                            ``(i) are in a standard form used in the 
                        locality by the dwelling unit owner; and
                            ``(ii) contain terms and conditions that--
                                    ``(I) are consistent with State, 
                                tribal, and local law; and
                                    ``(II) apply generally to tenants 
                                in the property who are not assisted 
                                under this section;
                    ``(E) shall provide that the dwelling unit owner 
                may not terminate the tenancy of any person assisted 
                under this subsection during the term of a lease that 
                meets the requirements of this section unless the owner 
                determines, on the same basis and in the same manner as 
                would apply to a tenant in the property who does not 
                receive assistance under this subsection, that--
                            ``(i) the tenant has committed a serious 
                        violation of the terms and conditions of the 
                        lease;
                            ``(ii) the tenant has violated applicable 
                        Federal, State, or local law; or
                            ``(iii) other good cause for termination of 
                        the tenancy exists; and
                    ``(F) shall provide that any termination of tenancy 
                under this subsection shall be preceded by the 
                provision of written notice by the owner to the tenant 
                specifying the grounds for that action, and any relief 
                shall be consistent with applicable State, tribal, and 
                local law.
            ``(8) Inspection of units by public housing agencies.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), for each dwelling unit for which a 
                housing assistance payment contract is established 
                under this subsection, the public housing agency 
                shall--
                            ``(i) inspect the unit before any 
                        assistance payment is made to determine whether 
                        the dwelling unit meets housing quality 
                        standards for decent and safe housing 
                        established--
                                    ``(I) by the Secretary for purposes 
                                of this subsection; or
                                    ``(II) by local housing codes or by 
                                codes adopted by public housing 
                                agencies that--
                                            ``(aa) meet or exceed 
                                        housing quality standards; and
                                            ``(bb) do not severely 
                                        restrict housing choice; and
                            ``(ii) make periodic inspections during the 
                        contract term.
                    ``(B) Leasing of units owned by public housing 
                agency.--If an eligible family assisted under this 
                subsection leases a dwelling unit that is owned by a 
                public housing agency administering assistance under 
                this subsection, the Secretary shall require the unit 
                of general local government, or another entity approved 
                by the Secretary, to make inspections and rent 
                determinations as required by this paragraph.
            ``(9) Expedited inspection procedures.--
                    ``(A) Demonstration project.--Not later than 1 year 
                after the date of enactment of the Public Housing 
                Reform and Empowerment Act of 1995, the Secretary shall 
                establish a demonstration project to identify efficient 
                procedures to determine whether units meet housing 
                quality standards for decent and safe housing 
                established by the Secretary.
                    ``(B) Procedures included.--The demonstration 
                project shall include the development of procedures to 
                be followed in any case in which a family receiving 
                tenant-based assistance under this subsection is moving 
                into a dwelling unit, or in which a family notifies the 
                public housing agency that a dwelling unit, in which 
                the family no longer resides, fails to meet housing 
                quality standards. The Secretary shall also establish 
                procedures for the expedited repair and inspection of 
                units that do not meet housing quality standards.
                    ``(C) Recommendations.--Not later than 2 years 
                after the date on which the demonstration under this 
                paragraph is implemented, the Secretary shall submit a 
                report to the Congress, which shall include an analysis 
                of the demonstration and any recommendations for 
                changes to the demonstration.
            ``(10) Vacated units.--If a family vacates a dwelling unit, 
        no assistance payment may be made under this subsection for the 
        dwelling unit after the month during which the unit was 
        vacated.
            ``(11) Rent.--
                    ``(A) Reasonable market rent.--The rent for 
                dwelling units for which a housing assistance payment 
                contract is established under this subsection shall be 
                reasonable in comparison with rents charged for 
                comparable dwelling units in the private, unassisted, 
                local market.
                    ``(B) Negotiated rent.--A public housing agency 
                shall, at the request of a family receiving tenant-
                based assistance under this subsection, assist that 
                family in negotiating a reasonable rent with a dwelling 
                unit owner. A public housing agency shall review the 
                rent for a unit under consideration by the family (and 
                all rent increases for units under lease by the family) 
                to determine whether the rent (or rent increase) 
                requested by the owner is reasonable. If a public 
                housing agency determines that the rent (or rent 
                increase) for a dwelling unit is not reasonable, the 
                public housing agency shall not make housing assistance 
                payments to the owner under this subsection with 
                respect to that unit.
                    ``(C) Units exempt from local rent control.--If a 
                dwelling unit for which a housing assistance payment 
                contract is established under this subsection is exempt 
                from local rent control provisions during the term of 
                that contract, the rent for that unit shall be 
                reasonable in comparison with other units in the market 
                area that are exempt from local rent control 
                provisions.
                    ``(D) Timely payments.--Each public housing agency 
                shall make timely payment of any amounts due to a 
                dwelling unit owner under this subsection. The housing 
                assistance payment contract between the owner and the 
                public housing agency may provide for penalties for the 
                late payment of amounts due under the contract, which 
                shall be imposed on the public housing agency in 
                accordance with generally accepted practices in the 
                local housing market.
                    ``(E) Penalties.--Unless otherwise authorized by 
                the Secretary, each public housing agency shall pay any 
                penalties from administrative fees collected by the 
                public housing agency, except that no penalty shall be 
                imposed if the late payment is due to factors that the 
                Secretary determines are beyond the control of the 
                public housing agency.
            ``(12) Manufactured housing.--
                    ``(A) In general.--A public housing agency may make 
                assistance payments in accordance with this subsection 
                on behalf of a family that utilizes a manufactured home 
                as a principal place of residence. Such payments may be 
                made for the rental of the real property on which the 
                manufactured home owned by any such family is located.
                    ``(B) Rent calculation.--
                            ``(i) Charges included.--For assistance 
                        pursuant to this paragraph, the rent for the 
                        space on which a manufactured home is located 
                        and with respect to which assistance payments 
                        are to be made shall include maintenance and 
                        management charges and tenant-paid utilities.
                            ``(ii) Payment standard.--The public 
                        housing agency shall establish a payment 
                        standard for the purpose of determining the 
                        monthly assistance that may be paid for any 
                        family under this paragraph. The payment 
                        standard may not exceed an amount approved or 
                        established by the Secretary.
                            ``(iii) Monthly assistance payment.--The 
                        monthly assistance payment under this paragraph 
                        shall be determined in accordance with 
                        paragraph (2).
            ``(13) Contract for assistance payments.--
                    ``(A) In general.--If the Secretary enters into an 
                annual contributions contract under this subsection 
                with a public housing agency pursuant to which the 
                public housing agency will enter into a housing 
                assistance payment contract with respect to an existing 
                structure under this subsection--
                            ``(i) the housing assistance payment 
                        contract may not be attached to the structure 
                        unless the owner agrees to rehabilitate or 
                        newly construct the structure other than with 
                        assistance under this Act, and otherwise 
                        complies with this section; and
                            ``(ii) the public housing agency may 
                        approve a housing assistance payment contract 
                        for such existing structure for not more than 
                        15 percent of the funding available for tenant-
                        based assistance administered by the public 
                        housing agency under this section.
                    ``(B) Extension of contract term.--In the case of a 
                housing assistance payment contract that applies to a 
                structure under this paragraph, a public housing agency 
                shall enter into a contract with the owner, contingent 
                upon the future availability of appropriated funds for 
                the purpose of renewing expiring contracts for 
                assistance payments, as provided in appropriations 
                Acts, to extend the term of the underlying housing 
                assistance payment contract for such period as the 
                Secretary determines to be appropriate to achieve long-
                term affordability of the housing. The contract shall 
                obligate the owner to have such extensions of the 
                underlying housing assistance payment contract accepted 
                by the owner and the successors in interest of the 
                owner.
                    ``(C) Rent calculation.--For project-based 
                assistance under this paragraph, housing assistance 
                payment contracts shall establish rents and provide for 
                rent adjustments in accordance with subsection (c).
                    ``(D) Adjusted rents.--With respect to rents 
                adjusted under this paragraph--
                            ``(i) the adjusted rent for any unit shall 
                        not exceed the rent for a comparable unassisted 
                        unit of similar quality, type, and age in the 
                        market area; and
                            ``(ii) the provisions of subsection 
                        (c)(2)(A) do not apply.
            ``(14) Inapplicability to tenant-based assistance.--
        Subsection (c) does not apply to tenant-based assistance under 
        this subsection.
            ``(15) Homeownership option.--
                    ``(A) In general.--A public housing agency 
                providing assistance under this subsection may, at the 
                option of the agency, provide assistance for 
                homeownership under subsection (y).
                    ``(B) Alternative administration.--A public housing 
                agency may contract with a nonprofit organization to 
                administer a homeownership program under subsection 
                (y).
            ``(16) Indian housing programs.--Notwithstanding any other 
        provision of law, in carrying out this section, the Secretary 
        shall establish such separate formulas and programs as may be 
        necessary to carry out housing programs for Indians under this 
        section.''.

SEC. 202. REPEAL OF FEDERAL PREFERENCES.

    (a) Section 8 Existing and Moderate Rehabilitation.--Section 
8(d)(1)(A) of the United States Housing Act of 1937 (42 U.S.C. 
1437f(d)(1)(A)) is amended to read as follows:
                    ``(A) the selection of tenants shall be the 
                function of the owner, subject to the annual 
                contributions contract between the Secretary and the 
                agency, except that with respect to the certificate and 
                moderate rehabilitation programs only, for the purpose 
                of selecting families to be assisted, the public 
                housing agency may establish, after public notice and 
                an opportunity for public comment, a written system of 
                preferences for selection that are not inconsistent 
                with the comprehensive housing affordability strategy 
                for the jurisdiction in which the project is located, 
                in accordance with title I of the Cranston-Gonzalez 
                National Affordable Housing Act;''.
    (b) Section 8 New Construction and Substantial Rehabilitation.--
            (1) Repeal.--Section 545(c) of the Cranston-Gonzalez 
        National Affordable Housing Act (42 U.S.C. 1437f note) is 
        amended to read as follows:
    ``(c) [Reserved.]''.
            (2) Prohibition.--The provisions of section 8(e)(2) of the 
        United States Housing Act of 1937, as in existence on the day 
        before October 1, 1983, that require tenant selection 
        preferences shall not apply with respect to--
                    (A) housing constructed or substantially 
                rehabilitated pursuant to assistance provided under 
                section 8(b)(2) of the United States Housing Act of 
                1937, as in existence on the day before October 1, 
                1983; or
                    (B) projects financed under section 202 of the 
                Housing Act of 1959, as in existence on the day before 
                the date of enactment of the Cranston-Gonzalez National 
                Affordable Housing Act.
    (c) Rent Supplements.--Section 101(k) of the Housing and Urban 
Development Act of 1965 (12 U.S.C. 1701s(k)) is amended to read as 
follows:
    ``(k) [Reserved.]''.
    (d) Conforming Amendments.--
            (1) United states housing act of 1937.--The United States 
        Housing Act of 1937 (42 U.S.C. 1437 et seq.) is amended--
                    (A) in section 6(o), by striking ``preference rules 
                specified in'' and inserting ``written selection 
                criteria established pursuant to'';
                    (B) in section 7(a)(2), by striking ``according to 
                the preferences for occupancy under'' and inserting 
                ``in accordance with the written selection criteria 
                established pursuant to'';
                    (C) in section 7(a)(3), by striking ``who qualify 
                for preferences for occupancy under'' and inserting 
                ``who meet the written selection criteria established 
                pursuant to'';
                    (D) in section 8(d)(2)(A), by striking the last 
                sentence;
                    (E) in section 8(d)(2)(H), by striking 
                ``Notwithstanding subsection (d)(1)(A)(i), an'' and 
                inserting ``An''; and
                    (F) in section 16(c), in the second sentence, by 
                striking ``the system of preferences established by the 
                agency pursuant to section 6(c)(4)(A)(ii)'' and 
                inserting ``the written selection criteria established 
                by the public housing agency pursuant to section 
                6(c)(4)(A)''.
            (2) Cranston-gonzalez national affordable housing act.--The 
        Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 
        12704 et seq.) is amended--
                    (A) in section 455(a)(2)(D)(iii), by striking 
                ``would qualify for a preference under'' and inserting 
                ``meet the written selection criteria established 
                pursuant to''; and
                    (B) in section 522(f)(6)(B), by striking ``any 
                preferences for such assistance under section 
                8(d)(1)(A)(i)'' and inserting ``the written selection 
                criteria established pursuant to section 8(d)(1)(A)''.
            (3) Low-income housing preservation and resident 
        homeownership act of 1990.--The second sentence of section 
        226(b)(6)(B) of the Low-Income Housing Preservation and 
        Resident Homeownership Act of 1990 (12 U.S.C. 4116(b)(6)(B)) is 
        amended by striking ``requirement for giving preferences to 
        certain categories of eligible families under'' and inserting 
        ``written selection criteria established pursuant to''.
            (4) Housing and community development act of 1992.--Section 
        655 of the Housing and Community Development Act of 1992 (42 
        U.S.C. 13615) is amended by striking ``preferences for 
        occupancy'' and all that follows before the period at the end 
        and inserting ``selection criteria established by the owner to 
        elderly families according to such written selection criteria, 
        and to near-elderly families according to such written 
        selection criteria, respectively''.
            (5) References in other law.--Any reference in any Federal 
        law other than any provision of any law amended by paragraphs 
        (1) through (5) of this subsection or section 201 to the 
        preferences for assistance under section 6(c)(4)(A)(i), 
        8(d)(1)(A)(i), or 8(o)(3)(B) of the United States Housing Act 
        of 1937, as those sections existed on the day before the 
        effective date of this title, shall be considered to refer to 
        the written selection criteria established pursuant to section 
        6(c)(4)(A), 8(d)(1)(A), or 8(o)(6)(A), respectively, of the 
        United States Housing Act of 1937, as amended by this 
        subsection and section 201 of this Act.

SEC. 203. PORTABILITY.

    Section 8(r) of the United States Housing Act of 1937 (42 U.S.C. 
1437f(r)) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``assisted under subsection (b) or 
                (o)'' and inserting ``receiving tenant-based assistance 
                under subsection (o)''; and
                    (B) by striking ``the same State'' and all that 
                follows before the semicolon and inserting ``any area 
                in which a program is being administered under this 
                section'';
            (2) in paragraph (3)--
                    (A) by striking ``(b) or''; and
                    (B) by adding at the end the following new 
                sentence: ``The Secretary shall establish procedures 
                for the compensation of public housing agencies that 
                issue vouchers to families that move into or out of the 
                jurisdiction of the public housing agency under 
                portability procedures. The Secretary may reserve 
                amounts available for assistance under subsection (o) 
                to compensate those public housing agencies.''; and
            (3) by adding at the end the following new paragraph:
            ``(5) Lease violations.--A family may not receive a voucher 
        from a public housing agency and move to another jurisdiction 
        under the tenant-based assistance program if the family has 
        moved out of the assisted dwelling unit of the family in 
        violation of a lease.''.

SEC. 204. LEASING TO VOUCHER HOLDERS.

    Section 8(t) of the United States Housing Act of 1937 (42 U.S.C. 
1437f(t)) is amended to read as follows:
    ``(t) [Reserved.]''.

SEC. 205. HOMEOWNERSHIP OPTION.

    Section 8(y) of the United States Housing Act of 1937 (42 U.S.C. 
1437f(y)) is amended--
            (1) in paragraph (1)(A), by inserting before the semicolon 
        ``, or owns or is acquiring shares in a cooperative'';
            (2) in paragraph (1)(B), by striking ``(i) participates'' 
        and all that follows through ``(ii) demonstrates'' and 
        inserting ``demonstrates'';
            (3) by striking paragraph (2) and inserting the following:
            ``(2) Determination of amount of assistance.--
                    ``(A) Monthly expenses do not exceed payment 
                standard.--If the monthly homeownership expenses, as 
                determined in accordance with requirements established 
                by the Secretary, do not exceed the payment standard, 
                the monthly assistance payment shall be the amount by 
                which the homeownership expenses exceed the highest of 
                the following amounts, rounded to the nearest dollar:
                            ``(i) Thirty percent of the monthly 
                        adjusted income of the family.
                            ``(ii) Ten percent of the monthly income of 
                        the family.
                            ``(iii) If the family is receiving payments 
                        for welfare assistance from a public agency, 
                        and a portion of those payments, adjusted in 
                        accordance with the actual housing costs of the 
                        family, is specifically designated by that 
                        agency to meet the housing costs of the family, 
                        the portion of those payments that is so 
                        designated.
                    ``(B) Monthly expenses exceed payment standard.--If 
                the monthly homeownership expenses, as determined in 
                accordance with requirements established by the 
                Secretary, exceed the payment standard, the monthly 
                assistance payment shall be the amount by which the 
                applicable payment standard exceeds the highest of the 
                following amounts, rounded to the nearest dollar:
                            ``(i) Thirty percent of the monthly 
                        adjusted income of the family.
                            ``(ii) Ten percent of the monthly income of 
                        the family.
                            ``(iii) If the family is receiving payments 
                        for welfare assistance from a public agency and 
                        a part of those payments, adjusted in 
                        accordance with the actual housing costs of the 
                        family, is specifically designated by that 
                        agency to meet the housing costs of the family, 
                        the portion of those payments that is so 
                        designated.'';
            (4) by striking paragraphs (3) through (5); and
            (5) by redesignating paragraphs (6) through (8) as 
        paragraphs (3) through (5), respectively.

SEC. 206. TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Contract Provisions and Requirements.--Section 6(p)(1)(B) of 
the United States Housing Act of 1937 (42 U.S.C. 1437d(p)(1)(B)) is 
amended by striking ``holding certificates and vouchers'' and inserting 
``receiving tenant-based assistance''.
    (b) Lower Income Housing Assistance.--Section 8 of the United 
States Housing Act of 1937 (42 U.S.C. 1437f) is amended--
            (1) in subsection (a), by striking the second and third 
        sentences;
            (2) in subsection (b)--
                    (A) in the subsection heading, by striking ``Rental 
                Certificates and''; and
                    (B) in the first undesignated paragraph--
                            (i) by striking ``The Secretary'' and 
                        inserting the following:
            ``(1) In general.--The Secretary''; and
                            (ii) by striking the second sentence;
            (3) in subsection (c)--
                    (A) in paragraph (3)--
                            (i) by striking ``(A)''; and
                            (ii) by striking subparagraph (B);
                    (B) in the first sentence of paragraph (4), by 
                striking ``or by a family that qualifies to receive'' 
                and all that follows through ``1990'';
                    (C) by striking paragraph (5) and redesignating 
                paragraph (6) as paragraph (5);
                    (D) by striking paragraph (7) and redesignating 
                paragraphs (8) through (10) as paragraphs (6) through 
                (8), respectively;
                    (E) in paragraph (6), as redesignated, by inserting 
                ``(other than a contract under section 8(o))'' after 
                ``section'';
                    (F) in paragraph (7), as redesignated, by striking 
                ``(but not less than 90 days in the case of housing 
                certificates or vouchers under subsection (b) or (o))'' 
                and inserting ``, other than a contract under 
                subsection (o)''; and
                    (G) in paragraph (8), as redesignated, by striking 
                ``housing certificates or vouchers under subsection (b) 
                or (o)'' and inserting ``tenant-based assistance under 
                this section'';
            (4) in subsection (d)--
                    (A) in paragraph (1)(B)(iii), by striking ``on or 
                near such premises''; and
                    (B) in paragraph (2)--
                            (i) in subparagraph (A), by striking the 
                        third sentence and all that follows through the 
                        end of the subparagraph; and
                            (ii) by striking subparagraphs (B) through 
                        (E) and redesignating subparagraphs (F) through 
                        (H) as subparagraphs (B) through (D), 
                        respectively;
                    ``(B) [Reserved.]'';
            (5) in subsection (f)--
                    (A) in paragraph (6), by striking ``(d)(2)'' and 
                inserting ``(o)(11)''; and
                    (B) in paragraph (7)--
                            (i) by striking ``(b) or''; and
                            (ii) by inserting before the period the 
                        following: ``and that provides for the eligible 
                        family to select suitable housing and to move 
                        to other suitable housing'';
            (6) by striking subsection (j) and inserting the following:
    ``(j) [Reserved.]'';
            (7) by striking subsection (n) and inserting the following:
    ``(n) [Reserved.]'';
            (8) in subsection (q)--
                    (A) in the first sentence of paragraph (1), by 
                striking ``and housing voucher programs under 
                subsections (b) and (o)'' and inserting ``program under 
                this section'';
                    (B) in paragraph (2)(A)(i), by striking ``and 
                housing voucher programs under subsections (b) and 
                (o)'' and inserting ``program under this section''; and
                    (C) in paragraph (2)(B), by striking ``and housing 
                voucher programs under subsections (b) and (o)'' and 
                inserting ``program under this section'';
            (9) in subsection (u), by striking ``certificates or'' each 
        place that term appears; and
            (10) in subsection (x)(2), by striking ``housing 
        certificate assistance'' and inserting ``tenant-based 
        assistance''.
    (c) Public Housing Homeownership and Management Opportunities.--
Section 21(b)(3) of the United States Housing Act of 1937 (42 U.S.C. 
1437s(b)(3)) is amended--
            (1) in the first sentence, by striking ``(at the option of 
        the family) a certificate under section 8(b)(1) or a housing 
        voucher under section 8(o)'' and inserting ``tenant-based 
        assistance under section 8''; and
            (2) by striking the second sentence.
    (d) Documentation of Excessive Rent Burdens.--Section 550(b) of the 
Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 1437f 
note) is amended--
            (1) in paragraph (1), by striking ``assisted under the 
        certificate and voucher programs established'' and inserting 
        ``receiving tenant-based assistance'';
            (2) in the first sentence of paragraph (2)--
                    (A) by striking ``, for each of the certificate 
                program and the voucher program'' and inserting ``for 
                the tenant-based assistance under section 8''; and
                    (B) by striking ``participating in the program'' 
                and inserting ``receiving tenant-based assistance''; 
                and
            (3) in paragraph (3), by striking ``assistance under the 
        certificate or voucher program'' and inserting ``tenant-based 
        assistance under section 8 of the United States Housing Act of 
        1937''.
    (e) Grants for Community Residences and Services.--Section 
861(b)(1)(D) of the Cranston-Gonzalez National Affordable Housing Act 
(42 U.S.C. 12910(b)(1)(D)) is amended by striking ``certificates or 
vouchers'' and inserting ``assistance''.
    (f) Section 8 Certificates and Vouchers.--Section 931 of the 
Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 1437c 
note) is amended by striking ``assistance under the certificate and 
voucher programs under sections 8(b) and (o) of such Act'' and 
inserting ``tenant-based assistance under section 8 of the United 
States Housing Act of 1937''.
    (g) Assistance for Displaced Tenants.--Section 223(a) of the 
Housing and Community Development Act of 1987 (12 U.S.C. 4113(a)) is 
amended by striking ``assistance under the certificate and voucher 
programs under sections 8(b) and 8(o)'' and inserting ``tenant-based 
assistance under section 8''.
    (h) Rural Housing Preservation Grants.--Section 533(a) of the 
Housing Act of 1949 (42 U.S.C. 1490m(a)) is amended in the second 
sentence by striking ``assistance payments as provided by section 
8(o)'' and inserting ``tenant-based assistance as provided under 
section 8''.
    (i) Repeal of Moving to Opportunities for Fair Housing 
Demonstration.--Section 152 of the Housing and Community Development 
Act of 1992 (42 U.S.C. 1437f note) is repealed.
    (j) Preferences for Elderly Families and Persons.--Section 655 of 
the Housing and Community Development Act of 1992 (42 U.S.C. 13615) is 
amended by striking ``the first sentence of section 8(o)(3)(B)'' and 
inserting ``section 8(o)(6)(A)''.
    (k) Assistance for Troubled Multifamily Housing Projects.--Section 
201(m)(2)(A) of the Housing and Community Development Amendments of 
1978 (12 U.S.C. 1715z-1a(m)(2)(A)) is amended by striking ``section 
8(b)(1)'' and inserting ``section 8''.
    (l) Management and Disposition of Multifamily Housing Projects.--
Section 203(g)(2) of the Housing and Community Development Amendments 
of 1978 (12 U.S.C. 1701z-11(g)(2)), as amended by section 101(b) of the 
Multifamily Housing Property Disposition Reform Act of 1994, is amended 
by striking ``8(o)(3)(B)'' and inserting ``8(o)(6)(A)''.

SEC. 207. IMPLEMENTATION.

    In accordance with the negotiated rulemaking procedures set forth 
in subchapter III of chapter 5 of title 5, United States Code, the 
Secretary shall issue such regulations as may be necessary to implement 
the amendments made by this title after notice and opportunity for 
public comment.

SEC. 208. DEFINITION.

    For the purposes of this title, public housing agency has the same 
meaning as section 3 of the United States Housing Act of 1937, except 
that such term shall also include any other nonprofit entity serving 
more than one local government jurisdiction that was administering the 
section 8 tenant-based assistance program pursuant to a contract with 
the Secretary or a public housing agency prior to the date of enactment 
of this Act.

SEC. 209. EFFECTIVE DATE.

    (a) In General.--The amendments made by this title shall become 
effective not later than 1 year after the date of enactment of this 
Act.
    (b) Conversion Assistance.--
            (1) In general.--The Secretary may provide for the 
        conversion of assistance under the certificate and voucher 
        programs under subsections (b) and (o) of section 8 of the 
        United States Housing Act of 1937, as those sections existed on 
        the day before the effective date of the amendments made by 
        this title, to the voucher program established by the 
        amendments made by this title.
            (2) Continued applicability.--The Secretary may apply the 
        provisions of the United States Housing Act of 1937, or any 
        other provision of law amended by this title, as those 
        provisions existed on the day before the effective date of the 
        amendments made by this title, to assistance obligated by the 
        Secretary before that effective date for the certificate or 
        voucher program under section 8 of the United States Housing 
        Act of 1937, if the Secretary determines that such action is 
        necessary for simplification of program administration, 
        avoidance of hardship, or other good cause.

                  TITLE III--MISCELLANEOUS PROVISIONS

SEC. 301. PUBLIC HOUSING FLEXIBILITY IN THE CHAS.

    Section 105(b) of the Cranston-Gonzalez National Affordable Housing 
Act (42 U.S.C. 12705(b)) is amended--
            (1) by redesignating the second paragraph designated as 
        paragraph (17) (as added by section 681(2) of the Housing and 
        Community Development Act of 1992) as paragraph (20);
            (2) by redesignating paragraph (17) (as added by section 
        220(b)(3) of the Housing and Community Development Act of 1992) 
        as paragraph (19);
            (3) by redesignating the second paragraph designated as 
        paragraph (16) (as added by section 220(c)(1) of the Housing 
        and Community Development Act of 1992) as paragraph (18);
            (4) in paragraph (16)--
                    (A) by striking the period at the end and inserting 
                a semicolon; and
                    (B) by striking ``(16)'' and inserting ``(17)'';
            (5) by redesignating paragraphs (11) through (15) as 
        paragraphs (12) through (16), respectively; and
            (6) by inserting after paragraph (10) the following new 
        paragraph:
            ``(11) describe the manner in which the plan of the 
        jurisdiction will help address the needs of public housing and 
        coordinate with the local public housing agency plan under 
        section 5A of the United States Housing Act of 1937;''.

SEC. 302. REPEAL OF CERTAIN PROVISIONS.

    (a) Maximum Annual Limitation on Rent Increases Resulting From 
Employment.--
            (1) Repeal.--Section 957 of the Cranston-Gonzalez National 
        Affordable Housing Act (42 U.S.C. 12714) is repealed.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall be deemed to have the same effective date as section 957 
        of the Cranston-Gonzalez National Affordable Housing Act.
    (b) Economic Independence.--
            (1) Repeal.--Section 923 of the Housing and Community 
        Development Act of 1992 (42 U.S.C. 12714 note) is repealed.
            (2) Effective date.--The amendment made by paragraph (1) 
        shall be deemed to have the same effective date as section 923 
        of the Housing and Community Development Act of 1992.

SEC. 303. DETERMINATION OF INCOME LIMITS.

    (a) In General.--Section 3(b)(2) of the United States Housing Act 
of 1937 (42 U.S.C. 1437a(b)(2)) is amended--
            (1) in the fourth sentence--
                    (A) by striking ``County,'' and inserting ``and 
                Rockland Counties''; and
                    (B) by inserting ``each'' before ``such county''; 
                and
            (2) in the fifth sentence, by striking ``County'' each 
        place that term appears and inserting ``and Rockland 
        Counties''.
    (b) Regulations.--Not later than 90 days after the date of 
enactment of this Act, the Secretary shall issue regulations 
implementing the amendments made by subsection (a).

SEC. 304. DEMOLITION OF PUBLIC HOUSING.

    (a) Repeal.--Section 415 of the Department of Housing and Urban 
Development--Independent Agencies Appropriations Act, 1988 (Public Law 
100-202; 101 Stat. 1329-213) is repealed.
    (b) Funding Availability.--Notwithstanding any other provision of 
law, beginning on the date of enactment of this Act, the public housing 
projects described in section 415 of the Department of Housing and 
Urban Development--Independent Agencies Appropriations Act, 1988, as 
that section existed on the day before the date of enactment of this 
Act, shall be eligible for demolition under--
            (1) section 14 of the United States Housing Act of 1937, as 
        that section existed on the day before the date of enactment of 
        this Act; and
            (2) section 9 of the United States Housing Act of 1937, as 
        amended by this Act.

SEC. 305. COORDINATION OF TAX CREDITS AND SECTION 8.

    Notwithstanding any other provision of law, rehabilitation 
activities undertaken in projects using the Low-Income Housing Tax 
Credit allocated to developments in the City of New Brunswick, New 
Jersey, in 1991, are hereby deemed to have met the requirements for 
rehabilitation in accordance with clause (ii) of the third sentence of 
section 8(d)(2)(A) of the United States Housing Act of 1937, as 
amended.

SEC. 306. ELIGIBILITY FOR PUBLIC AND ASSISTED HOUSING.

    Section 214 of the Housing and Community Development Act of 1980 
(42 U.S.C. 1436a) is amended--
            (1) in subsection (b), by inserting before the period at 
        the end the following: ``and includes any other assistance 
        provided under the United States Housing Act of 1937'';
            (2) by adding at the end the following new subsection:
    ``(h) Verification of Eligibility.--
            ``(1) In general.--Except in the case of an election under 
        paragraph (2)(A), no individual or family applying for 
        financial assistance may receive such financial assistance 
        prior to the affirmative establishment and verification of 
        eligibility of that individual or family under this section by 
        the Secretary or other appropriate entity.
            ``(2) Rules applicable to public housing agencies.--A 
        public housing agency (as that term is defined in section 3 of 
        the United States Housing Act of 1937)--
                    ``(A) may elect not to comply with this section; 
                and
                    ``(B) in complying with this section--
                            ``(i) may initiate procedures to 
                        affirmatively establish or verify the 
                        eligibility of an individual or family under 
                        this section at any time at which the public 
                        housing agency determines that such eligibility 
                        is in question, regardless of whether or not 
                        that individual or family is at or near the top 
                        of the waiting list of the public housing 
                        agency;
                            ``(ii) may affirmatively establish or 
                        verify the eligibility of an individual or 
                        family under this section in accordance with 
                        the procedures set forth in section 274A(b)(1) 
                        of the Immigration and Nationality Act; and
                            ``(iii) shall have access to any relevant 
                        information contained in the SAVE system (or 
                        any successor thereto) that relates to any 
                        individual or family applying for financial 
                        assistance.
            ``(3) Eligibility of families.--For purposes of this 
        subsection, with respect to a family, the term `eligibility' 
        means the eligibility of each family member.''.

            Passed the Senate January 10 (legislative day, January 8), 
      1996.

            Attest:

                                                             Secretary.

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104th CONGRESS

  2d Session

                                S. 1260

_______________________________________________________________________

                                 AN ACT

 To reform and consolidate the public and assisted housing programs of 
  the United States, and to redirect primary responsibility for these 
programs from the Federal Government to States and localities, and for 
                            other purposes.