[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 811 Enrolled Bill (ENR)]

        S.811

                       One Hundred Eighth Congress

                                 of the

                        United States of America


                          AT THE FIRST SESSION

          Begun and held at the City of Washington on Tuesday,
           the seventh day of January, two thousand and three


                                 An Act


 
To support certain housing proposals in the fiscal year 2003 budget for 
the Federal Government, including the downpayment assistance initiative 
   under the HOME Investment Partnership Act, 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. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:
Sec. 1. Table of contents.

                     TITLE I--DOWNPAYMENT ASSISTANCE

Sec. 101. Short title.
Sec. 102. Downpayment assistance initiative.

             TITLE II--INTERGENERATIONAL HOUSING ASSISTANCE

Sec. 201. Short title.
Sec. 202. Definitions.
Sec. 203. Demonstration program for elderly housing for 
          intergenerational families.
Sec. 204. Training for HUD personnel regarding grandparent-headed and 
          relative-headed families issues.
Sec. 205. Study of housing needs of grandparent-headed and relative-
          headed families.

   TITLE III--ADJUSTABLE RATE SINGLE FAMILY MORTGAGES AND LOAN LIMIT 
                               ADJUSTMENTS

Sec. 301. Hybrid arms.
Sec. 302. FHA multifamily loan limit adjustments.

                TITLE IV--HOPE VI PROGRAM REAUTHORIZATION

Sec. 401. Short title.
Sec. 402. Hope VI program reauthorization.
Sec. 403. Hope VI grants for assisting affordable housing through main 
          street projects.

               TITLE V--COMMUNITY DEVELOPMENT BLOCK GRANTS

Sec. 501. Funding for insular areas.

                    TITLE I--DOWNPAYMENT ASSISTANCE

SEC. 101. SHORT TITLE.

    This title may be cited as the ``American Dream Downpayment Act''.

SEC. 102. DOWNPAYMENT ASSISTANCE INITIATIVE.

    Subtitle E of title II of the Cranston-Gonzalez National Affordable 
Housing Act (42 U.S.C. 12821) is amended to read as follows:

                     ``Subtitle E--Other Assistance

``SEC. 271. DOWNPAYMENT ASSISTANCE INITIATIVE.

    ``(a) Definitions.--In this section:
        ``(1) Downpayment assistance.--The term ``downpayment 
    assistance'' means assistance to help a family acquire a principal 
    residence.
        ``(2) Home repairs.--The term ``home repairs'' means capital 
    improvements or repairs that--
            ``(A) are identified in an appraisal or home inspection 
        completed in conjunction with a home purchase; or
            ``(B) are completed within 1 year of the purchase of a 
        home, and are necessary to bring the housing into compliance 
        with health and safety housing codes of the unit of general 
        local government in which the housing is located, including the 
        remediation of lead paint or other home health hazards.
        ``(3) Participating jurisdiction.--The term ``participating 
    jurisdiction'' means a State or unit of general local government 
    designated under section 216.
        ``(4) State.--The term ``State'' means any State of the United 
    States and the District of Columbia.
    ``(b) Grant Authority.--The Secretary may award grants to 
participating jurisdictions to assist low-income families to achieve 
homeownership, in accordance with this section.
    ``(c) Eligible Activities.--
        ``(1) In general.--
            ``(A) Downpayment assistance.--Subject to subparagraph (B), 
        grants awarded under this section may be used only for 
        downpayment assistance toward the purchase of single family 
        housing (including 1 to 4 unit family dwelling units, 
        condominium units, cooperative units, and manufactured housing 
        units which are located on land which is owned by the 
        manufactured housing unit owner, owned as a cooperative, or is 
        subject to a leasehold interest with a term equal to at least 
        the term of the mortgage financing on the unit, and 
        manufactured housing lots) by low-income families who are 
        first-time home-buyers.
            ``(B) Home repairs.--Not more than 20 percent of the grant 
        funds provided under subsection (d) to a participating 
        jurisdiction may be used to provide assistance to low-income, 
        first-time home-buyers for home repairs.
        ``(2) Limitations.--
            ``(A) Amount of assistance.--The amount of assistance 
        provided to any low-income families under paragraph (1) shall 
        not exceed the greater of--
                ``(i) 6 percent of the purchase price of a single 
            family housing unit; or
                ``(ii) $10,000.
            ``(B) Participation.--A participating jurisdiction may not 
        use any amount of a grant awarded under this section to provide 
        funding to an entity or organization that provides downpayment 
        assistance if the activities of that entity or organization are 
        financed in whole or in part, directly or indirectly, by 
        contributions, service fees, or other payments from the sellers 
        of housing.
    ``(d) Formula Allocation.--
        ``(1) In general.--For each fiscal year, the Secretary shall 
    allocate any amounts made available for assistance under this 
    section to each State that is a participating jurisdiction in an 
    amount equal to a percentage of the total allocation that is equal 
    to the percentage of the national total of low-income households 
    residing in rental housing in the State, as determined on the basis 
    of the most recent census data compiled by the Bureau of the 
    Census.
        ``(2) Participating jurisdictions other than states.--
            ``(A) In general.--Subject to subparagraph (B), for each 
        fiscal year, of the amount allocated to each State under 
        paragraph (1), the Secretary shall further allocate from such 
        amount to each participating jurisdiction located within such 
        State an amount equal to the percentage of the allocation made 
        to the State under paragraph (1) that is equal to the 
        percentage of the State-wide total of low-income households 
        residing in rental housing in such participating jurisdiction, 
        as determined on the basis of the most recent census data 
        compiled by the Bureau of the Census.
            ``(B) Limitation.--
                ``(i) In general.--Direct allocations made under 
            subparagraph (A) shall be made to a local participating 
            jurisdiction only if--

                    ``(I) the participating jurisdiction has a total 
                population of 150,000 individuals or more, as 
                determined on the basis of the most recent census data 
                compiled by the Bureau of the Census; or
                    ``(II) the participating jurisdiction would receive 
                an allocation of $50,000 or more.

                ``(ii) Reversion.--Any allocation that would have 
            otherwise been made to a participating jurisdiction that 
            does not meet the requirements of clause (i) shall revert 
            back to the State in which the participating jurisdiction 
            is located.
    ``(e) Reallocation.--If any amounts allocated to a participating 
jurisdiction under this section become available for reallocation, the 
amounts shall be reallocated to other participating jurisdictions in 
accordance with subsection (d).
    ``(f) Applicability of Other Provisions.--
        ``(1) In general.--Except as otherwise provided in this 
    section, grants made under this section shall not be subject to the 
    provisions of this title.
        ``(2) Applicable provisions.--In addition to the requirements 
    of this section, grants made under this section shall be subject to 
    the provisions of title I, sections 215(b), 218, 219, 221, 223, 
    224, and 226(a) of subtitle A of this title, and subtitle F of this 
    title.
        ``(3) References.--In applying the requirements of subtitle A 
    referred to in paragraph (2)--
            ``(A) any references to funds under subtitle A shall be 
        considered to refer to amounts made available for assistance 
        under this section; and
            ``(B) any references to funds allocated or reallocated 
        under section 217 or 217(d) shall be considered to refer to 
        amounts allocated or reallocated under subsection (d) or (e) of 
        this section, respectively.
    ``(g) Housing Strategy.--To be eligible to receive a grant under 
this section in any fiscal year, a participating jurisdiction shall 
include in its comprehensive housing affordability strategy developed 
under section 105 of the Cranston-Gonzalez National Affordable Housing 
Act (42 U.S.C. 12705) for such fiscal year--
        ``(1) a description of the anticipated use of any grant 
    received under this section;
        ``(2) a plan for conducting targeted outreach to residents and 
    tenants of public housing, trailer parks, and manufactured housing, 
    and to other families assisted by public housing agencies, for the 
    purpose of ensuring that grant amounts provided under this section 
    to a participating jurisdiction are used for downpayment assistance 
    for such residents, tenants, and families; and
        ``(3) a description of the actions to be taken to ensure the 
    suitability of families receiving downpayment assistance under this 
    section to undertake and maintain homeownership.
    ``(h) Report.--Not later than June 30, 2006, the Comptroller 
General of the United States shall submit a report containing a State-
by-State analysis of the impact of grants awarded under this section 
to--
        ``(1) the Committee on Banking, Housing, and Urban Affairs of 
    the Senate; and
        ``(2) the Committee on Financial Services of the House of 
    Representatives.
    ``(i) Sunset.--The Secretary shall have no authority to make grants 
under this Act after December 31, 2007.
    ``(j) Relocation Assistance and Downpayment Assistance.--The 
Uniform Relocation Assistance and Real Property Acquisition Policies 
Act of 1970 (84 Stat. 1894) shall not apply to downpayment assistance 
under this section.
    ``(k) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $200,000,000 for each of fiscal 
years 2004 through 2007.''.

             TITLE II--INTERGENERATIONAL HOUSING ASSISTANCE

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Living Equitably: Grandparents 
Aiding Children and Youth Act of 2003'' or the ``LEGACY Act of 2003''.

SEC. 202. DEFINITIONS.

    In this title:
        (1) Child.--The term ``child'' means an individual who--
            (A) is not attending school and is not more than 18 years 
        of age; or
            (B) is attending school and is not more than 19 years of 
        age.
        (2) Covered family.--The term ``covered family'' means a family 
    that--
            (A) includes a child; and
            (B) has a head of household who is--
                (i) a grandparent of the child who is raising the 
            child; or
                (ii) a relative of the child who is raising the child.
        (3) Elderly person.--The term ``elderly person'' has the same 
    meaning as in section 202(k) of the Housing Act of 1959 (12 U.S.C. 
    1701q(k)).
        (4) Grandparent.--
            (A) In general.--The term ``grandparent'' means, with 
        respect to a child, an individual who is a grandparent or 
        stepgrandparent of the child by blood or marriage, regardless 
        of the age of such individual.
            (B) Case of adoption.--In the case of a child who was 
        adopted, the term includes an individual who, by blood or 
        marriage, is a grandparent or stepgrandparent of the child as 
        adopted.
        (5) Intergenerational dwelling unit.--The term 
    ``intergenerational dwelling unit'' means a qualified dwelling unit 
    that is reserved for occupancy only by an intergenerational family.
        (6) Intergenerational family.--The term ``intergenerational 
    family'' means a covered family that has a head of household who is 
    an elderly person.
        (7) Private nonprofit organization.--The term ``private 
    nonprofit organization'' has the same meaning as in section 202(k) 
    of the Housing Act of 1959 (12 U.S.C. 1701q(k)).
        (8) Qualified dwelling unit.--The term ``qualified dwelling 
    unit'' means a dwelling unit that--
            (A) has not fewer than 2 separate bedrooms;
            (B) is equipped with design features appropriate to meet 
        the special physical needs of elderly persons, as needed; and
            (C) is equipped with design features appropriate to meet 
        the special physical needs of young children, as needed.
        (9) Raising a child.--The term ``raising a child'' means, with 
    respect to an individual, that the individual--
            (A) resides with the child; and
            (B) is the primary caregiver for the child--
                (i) because the biological or adoptive parents of the 
            child do not reside with the child or are unable or 
            unwilling to serve as the primary caregiver for the child; 
            and
                (ii) regardless of whether the individual has a legal 
            relationship to the child (such as guardianship or legal 
            custody) or is caring for the child informally and has no 
            such legal relationship with the child.
        (10) Relative.--
            (A) In general.--The term ``relative'' means, with respect 
        to a child, an individual who--
                (i) is not a parent of the child by blood or marriage; 
            and
                (ii) is a relative of the child by blood or marriage, 
            regardless of the age of the individual.
            (B) Case of adoption.--In the case of a child who was 
        adopted, the term ``relative'' includes an individual who, by 
        blood or marriage, is a relative of the family who adopted the 
        child.
        (11) Secretary.--The term ``Secretary'' means the Secretary of 
    Housing and Urban Development.
    SEC. 203. DEMONSTRATION PROGRAM FOR ELDERLY HOUSING FOR 
      INTERGENERATIONAL FAMILIES.
    (a) Demonstration Program.--The Secretary shall carry out a 
demonstration program (referred to in this section as the 
``demonstration program'') to provide assistance for intergenerational 
dwelling units for intergenerational families in connection with the 
supportive housing program under section 202 of the Housing Act of 1959 
(12 U.S.C. 1701q).
    (b) Intergenerational Dwelling Units.--The Secretary shall provide 
assistance under this section only to private nonprofit organizations 
selected under subsection (d) for use only for expanding the supply of 
intergenerational dwelling units, which units shall be provided--
        (1) by designating and retrofitting, for use as 
    intergenerational dwelling units, existing dwelling units that are 
    located within a project assisted under section 202 of the Housing 
    Act of 1959 (12 U.S.C. 1701q);
        (2) through development of buildings or projects comprised 
    solely of intergenerational dwelling units; or
        (3) through the development of an annex or addition to an 
    existing project assisted under section 202 of the Housing Act of 
    1959 (12 U.S.C. 1701q), that contains intergenerational dwelling 
    units, including through the development of elder cottage housing 
    opportunity units that are small, freestanding, barrier free, 
    energy efficient, removable dwelling units located adjacent to a 
    larger project or dwelling.
    (c) Program Terms.--Assistance provided pursuant to this section 
shall be subject to the provisions of section 202 of the Housing Act of 
1959 (12 U.S.C. 1701q), except that--
        (1) notwithstanding subsection (d)(1) of that section 202 or 
    any provision of that section restricting occupancy to elderly 
    persons, any intergenerational dwelling unit assisted under the 
    demonstration program may be occupied by an intergenerational 
    family;
        (2) subsections (e) and (f) of that section 202 shall not 
    apply;
        (3) in addition to the requirements under subsection (g) of 
    that section 202, the Secretary shall--
            (A) ensure that occupants of intergenerational dwelling 
        units assisted under the demonstration program are provided a 
        range of services that are tailored to meet the needs of 
        elderly persons, children, and intergenerational families; and
            (B) coordinate with the heads of other Federal agencies as 
        may be appropriate to ensure the provision of such services; 
        and
        (4) the Secretary may waive or alter any other provision of 
    that section 202 necessary to provide for assistance under the 
    demonstration program.
    (d) Selection.--The Secretary shall--
        (1) establish application procedures for private nonprofit 
    organizations to apply for assistance under this section; and
        (2) to the extent that amounts are made available pursuant to 
    subsection (f), select not less than 2 and not more than 4 projects 
    that are assisted under section 202 of the Housing Act of 1959 (12 
    U.S.C. 1701q) for assistance under this section, based on the 
    ability of the applicant to develop and operate intergenerational 
    dwelling units and national geographical diversity among those 
    projects funded.
    (e) Report.--Not later than 36 months after the date of enactment 
of this Act, the Secretary shall submit a report to Congress that--
        (1) describes the demonstration program; and
        (2) analyzes the effectiveness of the demonstration program.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated $10,000,000 to carry out this section.
    (g) Sunset.--The demonstration program carried out under this 
section shall terminate 5 years after the date of enactment of this 
Act.
    SEC. 204. TRAINING FOR HUD PERSONNEL REGARDING GRANDPARENT-HEADED 
      AND RELATIVE-HEADED FAMILIES ISSUES.
    Section 7 of the Department of Housing and Urban Development Act 
(42 U.S.C. 3535) is amended by adding at the end the following:
    ``(t) Training Regarding Issues Relating to Grandparent-Headed and 
Relative-Headed Families.--The Secretary shall ensure that all 
personnel employed in field offices of the Department who have 
responsibilities for administering the housing assistance program under 
section 8 of the United States Housing Act of 1937 (42 U.S.C. 1437f) or 
the supportive housing program under section 202 of the Housing Act of 
1959 (12 U.S.C. 1701q), and an appropriate number of personnel in the 
headquarters office of the Department who have responsibilities for 
those programs, have received adequate training regarding how covered 
families (as that term is defined in section 202 of the LEGACY Act of 
2003) can be served by existing affordable housing programs.''.
    SEC. 205. STUDY OF HOUSING NEEDS OF GRANDPARENT-HEADED AND 
      RELATIVE-HEADED FAMILIES.
    (a) In General.--The Secretary and the Director of the Bureau of 
the Census jointly shall--
        (1) conduct a study to determine an estimate of the number of 
    covered families in the United States and their affordable housing 
    needs; and
        (2) submit a report to Congress regarding the results of the 
    study conducted under paragraph (1).
    (b) Report and Recommendations.--The report required under 
subsection (a) shall--
        (1) be submitted to Congress not later than 12 months after the 
    date of enactment of this Act; and
        (2) include recommendations by the Secretary and the Director 
    of the Bureau of the Census regarding how the major assisted 
    housing programs of the Department of Housing and Urban 
    Development, including the supportive housing for the elderly 
    program under section 202 of the Housing Act of 1959 (12 U.S.C. 
    1701q) can be used and, if appropriate, amended or altered, to meet 
    the affordable housing needs of covered families.

   TITLE III--ADJUSTABLE RATE SINGLE FAMILY MORTGAGES AND LOAN LIMIT 
                              ADJUSTMENTS

SEC. 301. HYBRID ARMS.

    (a) In General.--Section 251(d)(1)(C) of the National Housing Act 
(12 U.S.C. 1715z-16(d)(1)(C)) is amended by striking ``five'' and 
inserting ``3''.
    (b) Applicability.--The amendment made by subsection (a) shall 
apply to mortgages executed on or after the date of the enactment of 
this title.

SEC. 302. FHA MULTIFAMILY LOAN LIMIT ADJUSTMENTS.

    (a) Short Title.--This section may be cited as the ``FHA 
Multifamily Loan Limit Adjustment Act of 2003''.
    (b) Maximum Mortgage Amount Limit for Multifamily Housing in High-
Cost Areas.--Sections 207(c)(3), 213(b)(2)(B)(i), 
220(d)(3)(B)(iii)(III), 221(d)(3)(ii)(II), 221(d)(4)(ii)(II), 
231(c)(2)(B), and 234(e)(3)(B) of the National Housing Act (12 U.S.C. 
1713(c)(3), 1715e(b)(2)(B)(i), 1715k(d)(3)(B)(iii)(II), 
1715l(d)(3)(ii)(III), 1715l(d)(4)(ii)(II), 1715v(c)(2)(B), and 
1715y(e)(3)(B)) are each amended--
        (1) by striking ``110 percent'' and inserting ``140 percent''; 
    and
        (2) by inserting ``, or 170 percent in high cost areas,'' after 
    ``140 percent''.
    (c) Catch-up Adjustments to Certain Maximum Mortgage Amount 
Limits.--
        (1) Section 207 limits.--Section 207(c)(3)(A) of the National 
    Housing Act (12 U.S.C. 1713(c)(3)(A)) is amended by striking 
    ``$11,250'' and inserting ``$17,460''.
        (2) Section 213 limits.--Section 213(b)(2)(A) of the National 
    Housing Act (12 U.S.C. 1715e(b)(2)(A)) is amended--
            (A) by striking ``$38,025'' and inserting ``$41,207'';
            (B) by striking ``$42,120'' and inserting ``$47,511'';
            (C) by striking ``$50,310'' and inserting ``$57,300'';
            (D) by striking ``$62,010'' and inserting ``$73,343'';
            (E) by striking ``$70,200'' and inserting ``$81,708'';
            (F) by striking ``$49,140'' and inserting ``$49,710'';
            (G) by striking ``$60,255'' and inserting ``$60,446'';
            (H) by striking ``$75,465'' and inserting ``$78,197''; and
            (I) by striking ``$85,328'' and inserting ``$85,836''.
    (d) Rehabilitation and Neighborhood Conservation Housing Mortgage 
Insurance.--Section 220(d)(3)(B)(iii) of the National Housing Act (12 
U.S.C. 1715k(d)(3)(B)(iii)) is amended--
        (1) by striking ``with respect to dollar amount limitations 
    applicable to rehabilitation projects described in subclause 
    (II),'' and inserting ``; (III)''; and
        (2) by redesignating subclauses (III) and (IV) as subclauses 
    (IV) and (V), respectively.

               TITLE IV--HOPE VI PROGRAM REAUTHORIZATION

SEC. 401. SHORT TITLE.

    This title may be cited as the ``HOPE VI Program Reauthorization 
and Small Community Mainstreet Rejuvenation and Housing Act of 2003''.

SEC. 402. HOPE VI PROGRAM REAUTHORIZATION.

    (a) Selection Criteria.--Section 24(e)(2) of the United States 
Housing Act of 1937 (42 U.S.C. 1437v(e)(2)) is amended--
        (1) by striking the matter preceding subparagraph (A) and 
    inserting the following:
        ``(2) Selection criteria.--The Secretary shall establish 
    criteria for the award of grants under this section and shall 
    include among the factors--'';
        (2) in subparagraph (B), by striking ``large-scale'';
        (3) in subparagraph (D)--
            (A) by inserting ``and ongoing implementation'' after 
        ``development''; and
            (B) by inserting ``, except that the Secretary may not 
        award a grant under this section unless the applicant has 
        involved affected public housing residents at the beginning and 
        during the planning process for the revitalization program, 
        prior to submission of an application'' before the semicolon at 
        the end;
        (4) in subparagraph (H), by striking ``and'' at the end;
        (5) by redesignating subparagraph (I) as subparagraph (L); and
        (6) by inserting after subparagraph (H) the following:
            ``(I) the extent to which the plan minimizes permanent 
        displacement of current residents of the public housing site 
        who wish to remain in or return to the revitalized community 
        and provides for community and supportive services to residents 
        prior to any relocation;
            ``(J) the extent to which the plan sustains or creates more 
        project-based housing units available to persons eligible for 
        public housing in markets where the plan shows there is demand 
        for the maintenance or creation of such units;
            ``(K) the extent to which the plan gives to existing 
        residents priority for occupancy in dwelling units which are 
        public housing dwelling units, or for residents who can afford 
        to live in other units, priority for those units in the 
        revitalized community; and''.
    (b) Definition of Severely Distressed Public Housing.--Section 
24(j)(2)(A)(iii) of the United States Housing Act of 1937 (42 U.S.C. 
1437v(j)(2)(A)(iii)) is amended--
        (1) in subclause (I), by striking ``or'' at the end;
        (2) in subclause (II), by inserting ``or'' after the semicolon 
    at the end; and
        (3) by inserting at the end the following:
                ``(III) is lacking in sufficient appropriate 
            transportation, supportive services, economic opportunity, 
            schools, civic and religious institutions, and public 
            services, resulting in severe social distress in the 
            project;''.
    (c) Study of Elderly and Disabled Public Housing Needs.--Not later 
than 18 months after the date of enactment of this Act, the Comptroller 
General of the United States shall submit a report to Congress 
regarding the extent of severely distressed elderly and non-elderly 
disabled public housing, and recommendations for improving that housing 
through the HOPE VI program or other means, taking into account the 
special needs of the residents.
    (d) Authorization of Appropriations.--Paragraph (1) of section 
24(m) of the United States Housing Act of 1937 (42 U.S.C. 1437v(m)(1)) 
is amended by striking ``, 2001, and 2002'' and inserting ``through 
2006''.
    (e) Extension of Program.--Section 24(n) of the United States 
Housing Act of 1937 (42 U.S.C. 1437v(n)) is amended by striking 
``September 30, 2004'' and inserting ``September 30, 2006''.
    SEC. 403. HOPE VI GRANTS FOR ASSISTING AFFORDABLE HOUSING THROUGH 
      MAIN STREET PROJECTS.
    (a)  Purposes.--Section 24(a) of the United States Housing Act of 
1937 (42 U.S.C. 1437v(a)) is amended by adding after and below 
paragraph (4) the following:
``It is also the purpose of this section to provide assistance to 
smaller communities for the purpose of facilitating the development of 
affordable housing for low-income families that is undertaken in 
connection with a main street revitalization or redevelopment project 
in such communities.''.
    (b) Grants for Assisting Affordable Housing Developed Through Main 
Street Projects in Smaller Communities.--Section 24 of the United 
States Housing Act of 1937 (42 U.S.C. 1437v) is amended--
        (1) by redesignating subsection (n) as subsection (o); and
        (2) by inserting after subsection (m) the following new 
    subsection:
    ``(n) Grants for Assisting Affordable Housing Developed Through 
Main Street Projects in Smaller Communities.--
        ``(1) Authority and use of grant amounts.--The Secretary may 
    make grants under this subsection to smaller communities. Such 
    grant amounts shall be used by smaller communities only to provide 
    assistance to carry out eligible affordable housing activities 
    under paragraph (4) in connection with an eligible project under 
    paragraph (2).
        ``(2) Eligible project.--For purposes of this subsection, the 
    term `eligible project' means a project that--
            ``(A) the Secretary determines, under the criteria 
        established pursuant to paragraph (3), is a main street 
        project;
            ``(B) is carried out within the jurisdiction of a smaller 
        community receiving the grant; and
            ``(C) involves the development of affordable housing that 
        is located in the commercial area that is the subject of the 
        project.
        ``(3) Main street projects.--The Secretary shall establish 
    requirements for a project to be considered a main street project 
    for purposes of this section, which shall require that the 
    project--
            ``(A) has as its purpose the revitalization or 
        redevelopment of a historic or traditional commercial area;
            ``(B) involves investment, or other participation, by the 
        government for, and private entities in, the community in which 
        the project is carried out; and
            ``(C) complies with such historic preservation guidelines 
        or principles as the Secretary shall identify to preserve 
        significant historic or traditional architectural and design 
        features in the structures or area involved in the project.
        ``(4) Eligible affordable housing activities.--For purposes of 
    this subsection, the activities described in subsection (d)(1) 
    shall be considered eligible affordable housing activities, except 
    that--
            ``(A) such activities shall be conducted with respect to 
        affordable housing rather than with respect to severely 
        distressed public housing projects; and
            ``(B) eligible affordable housing activities under this 
        subsection shall not include the activities described in 
        subparagraphs (B) through (E), (J), or (K) of subsection 
        (d)(1).
        ``(5) Maximum grant amount.--A grant under this subsection for 
    a fiscal year for a single smaller community may not exceed 
    $1,000,000.
        ``(6) Contribution requirement.--A smaller community applying 
    for a grant under this subsection shall be considered an applicant 
    for purposes of subsection (c) (relating to contributions by 
    applicants), except that--
            ``(A) such supplemental amounts shall be used only for 
        carrying out eligible affordable housing activities; and
            ``(B) paragraphs (1)(B) and (3) shall not apply to grants 
        under this subsection.
        ``(7) Applications and selection.--
            ``(A) Application.--Pursuant to subsection (e)(1), the 
        Secretary shall provide for smaller communities to apply for 
        grants under this subsection, except that the Secretary may 
        establish such separate or additional criteria for applications 
        for such grants as may be appropriate to carry out this 
        subsection.
            ``(B) Selection criteria.--The Secretary shall establish 
        selection criteria for the award of grants under this 
        subsection, which shall be based on the selection criteria 
        established pursuant to subsection (e)(2), with such changes as 
        may be appropriate to carry out the purposes of this 
        subsection.
        ``(8) Cost limits.--The cost limits established pursuant to 
    subsection (f) shall apply to eligible affordable housing 
    activities assisted with grant amounts under this subsection.
        ``(9) Inapplicability of other provisions.--The provisions of 
    subsections (g) (relating to disposition and replacement of 
    severely distressed public housing), and (h) (relating to 
    administration of grants by other entities), shall not apply to 
    grants under this subsection.
        ``(10) Reporting.--The Secretary shall require each smaller 
    community receiving a grant under this subsection to submit a 
    report regarding the use of all amounts provided under the grant.
        ``(11) Definitions.--For purposes of this subsection, the 
    following definitions shall apply:
            ``(A) Affordable housing.--The term `affordable housing' 
        means rental or homeownership dwelling units that--
                ``(i) are made available for initial occupancy to low-
            income families, with a subset of units made available to 
            very- and extremely-low income families; and
                ``(ii) are subject to the same rules regarding occupant 
            contribution toward rent or purchase and terms of rental or 
            purchase as dwelling units in public housing projects 
            assisted with a grant under this section.
            ``(B) Smaller community.--The term `smaller community' 
        means a unit of general local government (as such term is 
        defined in section 102 of the Housing and Community Development 
        Act of 1974 (42 U.S.C. 5302)) that--
                ``(i) has a population of 50,000 or fewer; and
                ``(ii)(I) is not served by a public housing agency; or
                ``(II) is served by a single public housing agency, 
            which agency administers 100 or fewer public housing 
            dwelling units.''.
    (c) Annual Report.--Section 24(l) of the United States Housing Act 
of 1937 (42 U.S.C. 1437v(l)) is amended--
        (1) in paragraph (3), by striking ``; and'' and inserting ``, 
    including a specification of the amount and type of assistance 
    provided under subsection (n);'';
        (2) by redesignating paragraph (4) as paragraph (5); and
        (3) by inserting after paragraph (3) the following:
        ``(4) the types of projects funded, and number of affordable 
    housing dwelling units developed with, grants under subsection (n); 
    and''.
    (d) Funding.--Section 24(m) of the United States Housing Act of 
1937 (42 U.S.C. 1437v(m)) is amended by adding at the end the 
following:
        ``(3) Set-aside for main street housing grants.--Of the amount 
    appropriated pursuant to paragraph (1) for any fiscal year, the 
    Secretary shall provide up to 5 percent for use only for grants 
    under subsection (n).''.

              TITLE V--COMMUNITY DEVELOPMENT BLOCK GRANTS

SEC. 501. FUNDING FOR INSULAR AREAS.

    (a) Definition of Insular Areas.--Section 102(a) of the Housing and 
Community Development Act of 1974 (42 U.S.C. 5302(a)) is amended by 
adding at the end the following:
        ``(24) The term `insular area' means each of Guam, the Northern 
    Mariana Islands, the Virgin Islands, and American Samoa.''.
    (b) Definition of Unit of General Government.--The first sentence 
of section 102(a)(1) of the Housing and Community Development Act of 
1974 (42 U.S.C. 5302(a)(1)) is amended--
        (1) by inserting ``and'' after ``Secretary;''; and
        (2) by striking ``; and the Trust Territory of the Pacific 
    Islands''.
    (c) Statement of Activities and Review.--Section 104 of the Housing 
and Community Development Act of 1974 (42 U.S.C. 5304) is amended--
        (1) in subsection (a)(1)--
            (A) in the first sentence--
                (i) by striking ``or'' after ``State,''; and
                (ii) by inserting ``or under section 106(a)(3) by any 
            insular area,'' after ``government,''; and
            (B) in the second sentence--
                (i) by striking ``and in the case of'' and inserting a 
            comma; and
                (ii) by inserting ``and insular areas receiving grants 
            pursuant to section 106(a)(3),'' after ``106(d)(2)(B),'';
        (2) in subsection (e)(1), by striking ``section 106(b) or 
    section 106(d)(2)(B)'' and inserting ``subsection (a)(3), (b), or 
    (d)(2)(B) of section 106''; and
        (3) in subsection (m)--
            (A) in paragraph (1), by inserting ``(a)(2),'' after 
        ``under subsection''; and
            (B) in paragraph (2), by striking ``government--'' and 
        inserting ``government other than an insular area--''.
    (d) Allocation and Distribution of Funds.--Section 106(a) of the 
Housing and Community Development Act of 1974 (42 U.S.C. 5306(a)) is 
amended--
        (1) in the first sentence of paragraph (1)--
            (A) by striking ``an appropriation Act'' and inserting 
        ``appropriation Acts''; and
            (B) by striking ``in any year'' and inserting ``for such 
        fiscal year'';
        (2) in paragraph (2), by inserting ``under paragraph (1) and 
    after reserving such amounts for insular areas under paragraph 
    (2)'' after ``tribes'';
        (3) in paragraph (3), by striking ``paragraphs (1) and (2)'' 
    and inserting ``paragraphs (1), (2), and (3)'';
        (4) by redesignating paragraphs (2) and (3) (as so amended) as 
    paragraphs (3) and (4); and
        (5) by inserting after paragraph (1) the following:
    ``(2) For each fiscal year, of the amount approved in appropriation 
Acts under section 103 for grants for such fiscal year (excluding the 
amounts provided for use in accordance with section 107), the Secretary 
shall reserve for grants to insular areas $7,000,000. The Secretary 
shall provide for distribution of amounts under this paragraph to 
insular areas on the basis of the ratio of the population of each 
insular area to the population of all insular areas. In determining the 
distribution of amounts to insular areas, the Secretary may also 
include other statistical criteria as data become available from the 
Bureau of the Census, but only if such criteria are contained in a 
regulation promulgated by the Secretary after notice and public 
comment.''.
    (e) Conforming Amendment.--The first sentence of section 106(d)(1) 
of the Housing and Community Development Act of 1974 (42 U.S.C. 
5306(d)(1)) is amended by striking ``paragraphs (1) and (2)'' and 
inserting ``paragraphs (1), (2), and (3)''.
    (f) Special Purpose Grants.--Section 107 of the Housing and 
Community Development Act of 1974 (42 U.S.C. 5307) is amended--
        (1) in subsection (a)(1)--
            (A) by striking subparagraph (A); and
            (B) by redesignating subparagraphs (B) through (H) as 
        subparagraphs (A) through (G), respectively; and
        (2) in subsection (b)--
            (A) by striking paragraph (1); and
            (B) by redesignating paragraphs (2) through (7) as 
        paragraphs (1) through (6), respectively.
    (g) Regulations.--The Secretary of Housing and Urban Development 
shall issue regulations to carry out the amendments made by this 
section, which shall take effect not later than the expiration of the 
90-day period beginning on the date of the enactment of this Act.

                               Speaker of the House of Representatives.

                            Vice President of the United States and    
                                               President of the Senate.