[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 1319 Introduced in Senate (IS)]







106th CONGRESS
  1st Session
                                S. 1319

 To authorize the Secretary of Housing and Urban Development to renew 
 project-based contracts for assistance under section 8 of the United 
  States Housing Act of 1937 at up to market rent levels, in order to 
preserve these projects as affordable low-income housing, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              July 1, 1999

   Mr. Bond introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
 To authorize the Secretary of Housing and Urban Development to renew 
 project-based contracts for assistance under section 8 of the United 
  States Housing Act of 1937 at up to market rent levels, in order to 
preserve these projects as affordable low-income housing, and for other 
                               purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Save My Home Act of 1999''.

SEC. 2. FINDINGS AND PURPOSE.

    (a) Findings.--Congress finds that--
            (1) there exists a need for decent, safe, and affordable 
        housing throughout the United States for low-income families;
            (2) affordable housing is critical to the physical and 
        emotional well-being of low-income families, especially 
        vulnerable populations such as the elderly and persons with 
        disabilities;
            (3) an unprecedented number of contracts for section 8 
        contracts are expiring over the next few years, including 
        contracts covering 2,384,000 units in fiscal year 2000 alone;
            (4) a substantial number of housing units receiving 
        project-based assistance have rents that are lower than the 
        rents of comparable, unassisted rental units in the same 
        housing rental market;
            (5) many of the residents in federally assisted housing are 
        elderly or persons with disabilities;
            (6) the elderly are especially vulnerable to displacement 
        trauma, which can lead to emotional problems and death;
            (7) due to the down sizing of the Department of Housing and 
        Urban Development and diminished administrative capacity, the 
        Department lacks the ability to effectively appraise the market 
        value of properties;
            (8) during 1998 alone, some 219 properties with over 25,000 
        units opted out of renewing their section 8 contracts, 
        resulting in the loss of this housing as affordable, low-income 
        housing;
            (9) currently some 3,000 section 8 project-based units are 
        being lost each month as affordable housing because owners of 
        section 8 project-based housing choosing to prepay or opt-out 
        upon the expiration of their section 8 contracts;
            (10) a significant number of these section 8 project-based 
        housing projects for which owners have elected to opt-out and 
        not renew their section 8 contracts are located in areas where 
        the availability of affordable housing is scarce;
            (11) in many of the cases where residents have been 
        provided vouchers because the owners of section 8 project-based 
        housing elected not to renew their section 8 contracts, the 
        residents have not been able to adequately use their vouchers 
        to obtain housing because of the lack of available, affordable 
        housing;
            (12) it is expected that--
                    (A) if no changes in the terms and conditions of 
                the section 8 contracts for project-based assistance 
                are made before the contracts expire, more private 
                owners will elect to not renew their contracts; and
                    (B) of those properties with respect to which the 
                owners do not renew their section 8 contracts, many of 
                the properties will no longer be affordable to its 
                current assisted residents due to significant rent 
                increases and, since many of the residents have little 
                or no means to pay the additional rent for these units 
                from personal income, these residents will be 
                effectively forced to move from their homes;
            (13) the Department of Housing and Urban Development has 
        had the authority to renew expiring section 8 project-based 
        contracts up to comparable market rent levels since October 27, 
        1997, and has failed to implement any policy for renewing these 
        contracts, resulting in the unnecessary loss of many of these 
        housing units as affordable, low-income housing and the 
        displacement of many vulnerable low-income families, including 
        the elderly and persons with disabilities;
            (14) the Department of Housing and Urban Development has 
        adequate funds in the Housing Certificate account to renew all 
        expiring section 8 project-based contracts at market rental 
        rates but has failed to make these funds available to preserve 
        this housing as affordable, low-income housing; and
            (15) the Department of Housing and Urban Development should 
        use all appropriate means to preserve housing assisted with 
        section 8 project-based contracts as affordable, low-income 
        housing.
    (b) Purpose.--The purpose of this Act is to protect vulnerable 
residents of affordable housing, especially the elderly, persons with 
disabilities, and those with large families--
            (1) to the extent feasible and appropriate, by ensuring 
        that the Department of Housing and Urban Development renew 
        expiring section 8 project-based contracts, and allowing low-
        income families to live in their homes without fear of 
        unreasonable displacement;
            (2) by ensuring that the Department of Housing and Urban 
        Development has done everything in its power to ensure that 
        housing with expiring section 8 project-based contracts are 
        renewed, especially those in rural areas and in other areas 
        with low vacancy rates; and
            (3) after the Department of Housing and Urban Development 
        has exhausted all means to ensure that housing with expiring 
        section 8 contracts are renewed, by providing flexible rental 
assistance, including enhanced vouchers, to ensure that vulnerable 
populations are not forced to move from their homes when rent levels 
rise to unaffordable levels due to the opt-out of owners who elect to 
not renew their expiring section 8 project-based contracts.

SEC. 3. DEFINITIONS.

    For purposes of this Act, the following definitions shall apply:
            (1) Assisted dwelling unit.--The term ``assisted dwelling 
        unit'' means a dwelling unit that--
                    (A) is in a covered project; and
                    (B) is covered by rental assistance provided under 
                the contract for project-based assistance for the 
                covered project.
            (2) Covered project.--The term ``covered project'' means 
        any housing that--
                    (A) consists of more than 4 dwelling units;
                    (B) is covered in whole or in part by a contract 
                for project-based assistance under--
                            (i) the new construction or substantial 
                        rehabilitation program under section 8(b)(2) of 
                        the United States Housing Act of 1937 (42 
                        U.S.C. 1437f(b)) (as in effect before October 
                        1, 1983);
                            (ii) the property disposition program under 
                        section 8(b) of the United States Housing Act 
                        of 1937 (42 U.S.C. 1437f(b));
                            (iii) the moderate rehabilitation program 
                        under section 8(e)(2) of the United States 
                        Housing Act of 1937 (42 U.S.C. 1437f(e)(2)) (as 
                        in effect before October 1, 1991);
                            (iv) the loan management assistance program 
                        under section 8 of the United States Housing 
                        Act of 1937 (42 U.S.C. 1437f);
                            (v) section 23 of the United States Housing 
                        Act of 1937 (42 U.S.C. 1437u) (as in effect 
                        before January 1, 1975);
                            (vi) the rent supplement program under 
                        section 101 of the Housing and Urban 
                        Development Act of 1965; or
                            (vii) section 8 of the United States 
                        Housing Act of 1937 (42 U.S.C. 1437f), 
                        following conversion from assistance under 
                        section 101 of the Housing and Urban 
                        Development Act of 1965,
                which contract will (under its own terms) expire during 
                the period consisting of fiscal years 2000 through 
                2004; and
                    (C) is not housing for which residents are eligible 
                for enhanced voucher assistance as provided under the 
                ``Preserving Existing Housing Investment'' account in 
                the Departments of Veterans Affairs and Housing and 
                Urban Development, and Independent Agencies 
                Appropriations Act, 1997 (Public Law 104-204; 110 Stat. 
                2884), pursuant to such provision or any other 
                subsequently enacted provision of law.
            (3) Covered resident.--The term ``covered resident'' means 
        a family who--
                    (A) is a low-income family as provided under 
                section 3(b)(2) of the United States Housing Act of 
                1937 (42 U.S.C. 1437a(b)(2)); and
                    (B) upon the date of the expiration of the contract 
                for project-based assistance for a covered project, is 
                residing in an assisted dwelling unit in the covered 
                project.
            (4) Low-vacancy area.--The term ``low-vacancy area'' means 
        an area that, in the determination of the Secretary, is not 
        adequate available and affordable housing or that the tenants 
        of the covered project would not be able to locate suitable 
        units or that the tenants of the covered project would not be 
        able to use tenant-based assistance successfully.
            (5) Project-based assistance.--The term ``project-based 
        assistance'' has the same meaning as in section 8(f) of the 
        United States Housing Act of 1937 (42 U.S.C. 1437f(f)).
            (6) Tenant-based assistance.--The term ``tenant-based 
        assistance'' has the same meaning as in section 8(f) of the 
        United States Housing Act of 1937 (42 U.S.C. 1437f(f)).
            (7) Secretary.--The term ``Secretary'' means the Secretary 
        of Housing and Urban Development.

SEC. 4. RENEWAL OF SECTION 8 PROJECT-BASED CONTRACTS.

    (a) In General.--Notwithstanding any other provision of law and 
except as provided in subsection (b) of this section, the Secretary may 
use amounts available for the renewal of assistance under section 8 of 
the United States Housing Act of 1937 (42 U.S.C. 1437f), upon the 
termination or expiration of a contract for assistance under section 8 
of the United States Housing Act of 1937 (42 U.S.C. 1437f) (other than 
a contract for tenant-based assistance and, notwithstanding section 
8(v) of such Act, for loan management assistance), to provide 
assistance under section 8 of such Act for a covered project under this 
Act at rent levels that do not exceed comparable market rents for the 
market area.
    (b) Mandatory Renewals.--The Secretary shall offer to renew, at up 
to rent levels that do not exceed comparable market rents for the 
market area, any contract for assistance under section 8 of the United 
States Housing Act of 1937 (42 U.S.C. 1437f) (other than a contract for 
tenant-based assistance and, notwithstanding section 8(v) of such Act, 
for loan management assistance) that has expired for any covered 
project--
            (1) in a low-vacancy area; or
            (2) where a predominant number of units are occupied by 
        elderly families, disabled families, or elderly and disabled 
        families.
    (c) Establishment of Market Rents.--The Secretary shall establish, 
for units assisted with project-based assistance in a covered project, 
adjusted rent levels that are equivalent to rents based on appraisals 
that are derived from comparable properties, if the market rent 
determination is based on not less than 2 comparable properties, 
including, if there are no comparable properties in the same market 
area, 2 properties that have been certified by the Secretary as similar 
to the covered properties as to neighborhood (including risk of crime), 
type of location, access, street appeal, age, property size, apartment 
mix, physical configuration, property and unit amenities, utilities, 
and other relevant characteristics, provided that the comparable 
projects are not receiving project-based assistance.
    (d) Subsidy Layering Requirements.--For purposes of this Act, in 
determining the market rent for renewing any contract for assistance 
under section 8 of the United States Housing Act of 1937 (42 U.S.C. 
1437f) (other than a contract for tenant-based assistance and, 
notwithstanding section 8(v) of such Act, for loan management 
assistance), the Secretary shall ensure that any assistance provided 
within the jurisdiction of the Housing and Urban Development shall not 
be greater than is necessary to provide affordable housing.
    (e) 10-Year Contracts.--Notwithstanding any other provision of law, 
the Secretary and owner of any covered project may agree to up to a 10-
year renewal of a contract for assistance under section 8 of the United 
States Housing Act of 1937 (42 U.S.C. 1437f) (other than a contract for 
tenant-based assistance and, notwithstanding section 8(v) of such Act, 
for loan management assistance) under which payments shall be subject 
to the annual availability of appropriations.

SEC. 5. ENHANCED VOUCHERS FOR RESIDENTS OF PROJECTS WITH EXPIRING 
              SECTION 8 CONTRACTS.

    (a) In General.--Upon the date of expiration of a contract for 
assistance under section 8 of the United States Housing Act of 1937 (42 
U.S.C. 1437f) (other than a contract for tenant-based assistance and, 
notwithstanding section 8(v) of such Act, for loan management 
assistance) for a covered project that is not renewed under section 4, 
the Secretary--
            (1) shall make enhanced voucher assistance under this 
        section available on behalf of each covered resident of a 
        covered project that is located in a low-vacancy area; and
            (2) may make enhanced voucher assistance available on 
        behalf of any other low-income family who, upon the date of 
        such expiration, is residing in an assisted dwelling unit in a 
        covered project.
    (b) Enhanced Assistance.--Enhanced voucher assistance under this 
section for a family shall be voucher assistance under section 8(o) of 
the United States Housing Act of 1937 (42 U.S.C. 1437f(o)) (42 U.S.C. 
1437f(o)), except that under such enhanced voucher assistance--
            (1) if the assisted family elects to remain in the covered 
        project in which the family was residing on the date of the 
        expiration of such contract and the rent for such unit exceeds 
        the applicable payment standard established pursuant to section 
        8(o) for the unit, the amount of the rental assistance provided 
        on behalf of family shall be determined using the payment 
        standard that is equal to the rent for the dwelling unit, 
        subject to paragraph (10)(A) of such section 8(o); and
            (2) if the assisted family elects to move from such covered 
        project, subparagraph (A) of this paragraph shall not apply and 
        the payment standard for the dwelling unit occupied by the 
        family shall be determined in accordance with section 8(o).
    (c) Authorization of Appropriations.--There is authorized to be 
appropriated for each of fiscal years 2000, 2001, 2002, 2003, and 2004 
such sums as may be necessary to carry out this section.

SEC. 6. APPRAISALS.

    (a) Use of Appraisals.--The appraisals used to establish market 
rents under section 4(c) shall--
            (1) meet the standards and procedures of the Uniform 
        Standards of Professional Appraisal Practice as published by 
        the Appraisal Standards Board of the Appraisal Standards 
        Foundation, as modified by the Secretary of Housing and Urban 
        Development; and
            (2) be performed by individuals who have demonstrated 
        competence and whose professional conduct is subject to 
        effective supervision.
    (b) Appraisal Clearinghouse.--In conjunction with the Appraisal 
Standards Foundation, the Secretary shall establish an Appraisal 
Clearinghouse, which shall be used to collect appraisal data and to 
develop model appraisal standards for use to establish the market value 
of multifamily housing, including covered projects, throughout the 
United States, including rural areas with multifamily housing that have 
no comparable housing in the same area.

SEC. 7. STAFFING REQUIREMENTS.

    The Secretary shall assign not less than 1 staff person to each 
Department of Housing and Urban Development Field Office that shall be 
responsible for evaluating the appraisals for the covered projects 
within the State. Each staff person shall have demonstrated competence 
to make appraisals and shall meet all licensing and certification 
requirements, as provided under applicable Federal or State law.

SEC. 8. HOUSING FINANCE AGENCIES.

    The Secretary may contract with State or local housing finance 
agencies that have been selected as a Participating Administrative 
Entity under the Multifamily Assisted Housing Reform and Affordability 
Act of 1997 for determining the market rental rates of a covered 
project.

SEC. 9. TECHNICAL ASSISTANCE.

    Section 514(f)(3) of the Multifamily Assisted Housing Reform and 
Affordability Act of 1997 is amended by inserting after ``the capacity 
of tenant organizations'', the following: ``for technical assistance 
for preserving properties whose owners may not renew their section 8 
project-based contracts where the rental assistance is below market 
(including transfer of developments to tenant groups, nonprofit 
organizations, and public entities)''.

SEC. 10. TRANSFER OF COVERED PROJECTS TO NONPROFIT ORGANIZATIONS.

    For covered projects with contracts for assistance under section 8 
of the United States Housing Act of 1937 (42 U.S.C. 1437f) (other than 
a contract for tenant-based assistance and, notwithstanding section 
8(v) of such Act, for loan management assistance) that are not renewed 
under section 4, the Secretary shall establish procedures to facilitate 
the voluntary sale or transfer of those covered projects, with a 
preference for tenant organizations, for tenant-endorsed, community-
based nonprofit organizations, and for public agency purchasers meeting 
such reasonable qualifications as may be established by the Secretary.

SEC. 11. REPORTS TO CONGRESS.

    Not later than 1 year after the date of enactment of this Act and 
semiannually thereafter, the Secretary shall report, by State, to 
Congress on the number of section 8 assisted units that have renewed, 
the number of section 8 assisted units that have not been renewed, and 
the costs associated with these activities.

SEC. 12. REGULATIONS.

    Not later than 6 months after the date of enactment of this Act, 
the Secretary shall issue regulations to carry out this Act.
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