[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2930 Introduced in House (IH)]







110th CONGRESS
  1st Session
                                H. R. 2930

To amend section 202 of the Housing Act of 1959 to improve the program 
  under such section for supportive housing for the elderly, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 28, 2007

    Mr. Mahoney of Florida introduced the following bill; which was 
            referred to the Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
To amend section 202 of the Housing Act of 1959 to improve the program 
  under such section for supportive housing for the elderly, and for 
                            other purposes.

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

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Section 202 
Supportive Housing for the Elderly Act of 2007''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title and table of contents.
                   TITLE I--NEW CONSTRUCTION REFORMS

Sec. 101. Project rental assistance.
Sec. 102. Selection criteria.
Sec. 103. Development cost limitations.
Sec. 104. Owner deposits.
Sec. 105. Definition of private nonprofit organization.
                         TITLE II--REFINANCING

Sec. 201. Approval of prepayment of debt.
Sec. 202. Sources of refinancing.
Sec. 203. Use of unexpended amounts.
Sec. 204. Use of project residual receipts.
Sec. 205. Additional provisions.
                 TITLE III--ASSISTED LIVING FACILITIES

Sec. 301. Definition of assisted living facility.
Sec. 302. Monthly assistance payment under rental assistance.

                   TITLE I--NEW CONSTRUCTION REFORMS

SEC. 101. PROJECT RENTAL ASSISTANCE.

    Paragraph (2) of section 202(c) of the Housing Act of 1959 (12 
U.S.C. 1701q(c)(2)) is amended--
            (1) by inserting after ``assistance.--'' the following: 
        ``(A) Initial project rental assistance contract.--'';
            (2) in the last sentence, by striking ``may'' and inserting 
        ``shall''; and
            (3) by adding at the end the following new subparagraph:
            ``(B) Renewal of and increases in contract amounts.--
                    ``(i) Expiration of contract term.--Upon the 
                expiration of each contract term, the Secretary shall 
                adjust the annual contract amount to provide for 
                reasonable project costs, and any increases, including 
                adequate reserves, supportive services, and service 
                coordinators, except that any contract amounts not used 
                by a project during a contract term shall not be 
                available for such adjustments upon renewal.
                    ``(ii) Emergency situations.--In the event of 
                emergency situations that are outside the control of 
                the owner, the Secretary shall increase the annual 
                contract amount, subject to reasonable review and 
                limitations as the Secretary shall provide.''.

SEC. 102. SELECTION CRITERIA.

    Subsection (f) of section 202 of the Housing Act of 1959 (12 U.S.C. 
1701q(f)) is amended--
            (1) by striking ``Selection Criteria.--'' and inserting 
        ``Initial Selection Criteria and Processing.--(1) Selection 
        criteria.--'';
            (2) by redesignating paragraphs (1) through (7) as 
        subparagraphs (A) through (G), respectively; and
            (3) by adding at the end the following new paragraph:
    ``(2) Delegated Processing.--
            ``(A) In issuing a capital advance under this section, the 
        Secretary shall delegate review and processing of such selected 
        capital advance projects to a State or local housing agency 
        that--
                    ``(i) is in geographic proximity to the property;
                    ``(ii) has demonstrated experience in and capacity 
                for underwriting multifamily housing loans that provide 
                housing and supportive services;
                    ``(iii) may or may not be providing low-income 
                housing tax credits in combination with the capital 
                advance under this section, and
                    ``(iv) agrees to issue a firm commitment within 12 
                months of delegation.
            ``(B) An agency to which review and processing is delegated 
        pursuant to subparagraph (A) may assess a reasonable fee which 
        shall be included in the capital advance amounts and may 
        recommend project rental assistance amounts in excess of those 
        initially awarded by the Secretary.
            ``(C) Under such delegated system, the Secretary shall 
        retain the authority to approve rents and development costs and 
        to execute a capital advance within 90 days of receipt of the 
        commitment from the State or local agency. The Secretary shall 
        provide to such agency and the project sponsor, in writing, the 
        reasons for any reduction in capital advance amounts or project 
        rental assistance and such reductions shall be subject to 
        appeal.''.

SEC. 103. DEVELOPMENT COST LIMITATIONS.

    Section 202(h)(1) of the Housing Act of 1959 (12 U.S.C. 
1701q(h)(1)) is amended, in the matter preceding subparagraph (A), by 
inserting ``reasonable'' before ``development cost limitations''.

SEC. 104. OWNER DEPOSITS.

    Section 202(j)(3)(A) of the Housing Act of 1959 (12 U.S.C. 
1701q(j)(3)(A)) is amended by inserting after the period at the end the 
following: ``Such amount shall be used only to cover operating deficits 
during the first three years of operations and shall not be used to 
cover construction shortfalls or inadequate initial project rental 
assistance amounts.''.

SEC. 105. DEFINITION OF PRIVATE NONPROFIT ORGANIZATION.

    Subparagraph (B) of section 202(k)(4) of the Housing Act of 1959 
(12 U.S.C. 1701q(k)(4)(B)) is amended by inserting before the semicolon 
the following: ``; except that, in the case of any national 
organization that is the owner of multiple housing projects assisted 
under this section, the organization may comply with clause (i) of this 
subparagraph by having a local advisory board to the governing board of 
the organization the membership which is selected in the manner 
required under clause (i)''.

                         TITLE II--REFINANCING

SEC. 201. APPROVAL OF PREPAYMENT OF DEBT.

    Subsection (a) of section 811 of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
            (1) in the matter preceding paragraph (1), by inserting ``, 
        for which the Secretary's consent to prepayment is required,'' 
        after ``Act)'';
            (2) in paragraph (1)--
                    (A) by inserting ``project-based'' before ``rental 
                assistance payments contract'';
                    (B) by inserting ``project-based'' before ``rental 
                housing assistance programs'';
                    (C) by inserting ``, or any successor project-based 
                rental assistance program,'' after ``1701s))''; and
                    (D) by inserting before the semicolon the 
                following; ``, except that if, such project-based 
                rental assistance is no longer available to the project 
                as a result of insufficient amounts of appropriated 
                funds for such purpose, or is no longer available on 
                terms that would provide the project with income 
                equivalent to the project-based rental assistance, the 
                project-based rental assistance contract shall be 
                deemed terminated, including all obligations and 
                restrictions thereunder, and the project owner may 
                charge tenants rent sufficient for the project owner to 
                meet debt service payments and operating cost 
                requirements approved by the Secretary. Such contract 
                termination shall be an eligibility event for purposes 
                of section 8(t) of the United States Housing Act of 
                1937 (42 U.S.C. 1437f(t)) and the tenants of such 
                project shall be eligible for enhanced vouchers in 
                accordance with such section.''; and
            (3) in paragraph (2)--
                    (A) by inserting ``(A)'' before ``a lower''; and
                    (B) by inserting ``, or (B) a transaction in which 
                the project owner will address the physical needs of 
                the project'' before the period at the end.

SEC. 202. SOURCES OF REFINANCING.

    The last sentence of section 811(b) of the American Homeownership 
and Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is 
amended--
            (1) by inserting after ``National Housing Act,'' the 
        following: ``or approving the standards used by authorized 
        lenders to underwrite a loan refinanced with risk sharing as 
        provided by section 542 of the Housing and Community 
        Development Act of 1992 (12 U.S.C.1701 note),''; and
            (2) by striking ``may'' and inserting ``shall''.

SEC. 203. USE OF UNEXPENDED AMOUNTS.

    Subsection (c) of section 811 of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
            (1) in the matter preceding paragraph (1), by inserting 
        after ``tenants,'' the following: ``or that furthers the 
        mission of the private nonprofit organization project owner, 
        private nonprofit organization project sponsor, or private 
        nonprofit organization project developer, relating to housing 
        and related social services,'';
            (2) in paragraph (1), by striking ``not more than 15 
        percent of'';
            (3) in paragraph (2), by inserting before the semicolon the 
        following; ``, including reducing the number of units and 
        reconfiguring units that are functionally obsolete, 
        unmarketable, or not economically viable'';
            (4) in paragraph (3), by striking ``or'' at the end;
            (5) in paragraph (4) by striking ``and'' at the end and 
        inserting a semicolon; and
            (6) by adding at the end the following new paragraphs:
            ``(5) the payment to the project owner, sponsor, or third 
        party developer of a developer's fee in an amount not to 
        exceed--
                    ``(A) in the case of a project refinanced through a 
                State low income housing tax credit program, the fee 
                permitted by the low income housing tax credit program 
                as calculated by the State program as a percentage of 
                acceptable development cost as defined by that State 
                program; or
                    ``(B) in the case of a project refinanced through 
                any other source of refinancing, 15 percent of the 
                acceptable development cost; and
            ``(6) the payment of equity, if any, to--
                    ``(A) in the case of a sale, to the seller or the 
                sponsor of the seller, in an amount equal to the lesser 
                of the purchase price or the appraised value of the 
                property, as each is reduced by the cost of prepaying 
                any outstanding indebtedness on the property and 
                transaction costs of the sale; or
                    ``(B) in the case of a refinancing without the 
                transfer of the property, to the project owner or the 
                project sponsor, in an amount equal to the difference 
                between the appraised value of the property less the 
                outstanding indebtedness and total acceptable 
                development cost.
For purposes of paragraphs (5)(B) and (6)(B), the term ``acceptable 
development cost'' shall include, as applicable, the cost of 
acquisition, rehabilitation, loan prepayment, initial reserve deposits, 
and transaction costs.''.

SEC. 204. USE OF PROJECT RESIDUAL RECEIPTS.

    Paragraph (1) of section 811(d) of the American Homeownership and 
Economic Opportunity Act of 2000 (12 U.S.C. 1701q note) is amended--
            (1) by striking ``not more than 15 percent of''; and
            (2) by inserting before the period at the end the 
        following: ``or other purposes approved by the Secretary''.

SEC. 205. ADDITIONAL PROVISIONS.

    Section 811 of the American Homeownership and Economic Opportunity 
Act of 2000 (12 U.S.C. 1701q note) is amended by adding at the end the 
following new subsections:
    ``(e) Senior Preservation Rental Assistance Contracts.--
Notwithstanding any other provision of law, in connection with a 
prepayment plan for a project approved under subsection (a) by the 
Secretary or as otherwise approved by the Secretary, to prevent 
displacement of elderly residents of the project in the case of 
refinancing or recapitalization and to further preservation and 
affordability of such project, at the election of the private nonprofit 
organization owner of the project, the Secretary shall provide project-
based rental assistance for the project under a senior preservation 
rental assistance contract, as follows:
            ``(1) Assistance under the contract shall be made available 
        to the private nonprofit organization owner--
                    ``(A) for a term of at least 20 years, subject to 
                annual appropriations, and
                    ``(B) under the same rules governing project-based 
                rental assistance made available under section 8 of the 
                Housing Act of 1937.
            ``(2) Any projects for which a senior preservation rental 
        assistance contract is provided shall be subject to a use 
        agreement to ensure continued project affordability having a 
        term of the longer of (A) the term of the senior preservation 
        rental assistance contract, or (B) such term as is required by 
        the new financing.
    ``(f) Mortgage Sale Demonstration.--The Secretary may sell 
mortgages associated with loans made under section 202 of the Housing 
Act of 1959 (as in effect before the enactment of the Cranston-Gonzalez 
National Affordable Housing Act) in accordance with the terms for sales 
of subsidized loans on multifamily housing projects under section 203 
of the Housing and Community Development Amendments of 1978 (12 U.S.C. 
1701z-11). The Secretary shall carry out a demonstration program, in 
not more than three States, to sell portfolios of such mortgages to 
State housing finance agencies for a price not to exceed the unpaid 
principal balances of such mortgages and otherwise in accordance with 
the requirements of such section 203.
    ``(g) Subordination or Assumption of Existing Debt.--In lieu of 
prepayment under this section of the indebtedness with respect to a 
project, the Secretary may approve--
            ``(1) in connection with new financing for the project, the 
        subordination of the loan for the project under section 202 of 
        the Housing Act of 1959 (as in effect before the enactment of 
        the Cranston-Gonzalez National Affordable Housing Act) and the 
        continued subordination of any other existing subordinate debt 
        previously approved by the Secretary to facilitate preservation 
        of the project as affordable housing, or
            ``(2) the assumption (which may include the subordination 
        described in paragraph (1)) of the loan for the project under 
        such section 202 in connection with the transfer of the project 
        with such a loan to a private nonprofit organization.
    ``(h) Flexible Subsidy Debt.--The Secretary shall waive the 
requirement that debt for a project pursuant to the flexible subsidy 
program under section 201 of the Housing and Community Development 
Amendments of 1978 (12 U.S.C. 1715z-1a) be prepaid in connection with a 
prepayment, refinancing, or transfer under this section of a project if 
such waiver is necessary for the financial feasibility of the 
transaction and is consistent with the long-term preservation of the 
project as affordable housing.
    ``(i) Prepayment When Secretary's Consent Not Required.--In 
connection with the prepayment under this section of a loan for which 
the Secretary's consent to prepayment is not required, at the project 
owner's election--
            ``(1) all tenants of the project shall be eligible for 
        enhanced vouchers in accordance with section 8(t) of the United 
        States Housing Act of 1937 (42 U.S.C. 1437f(t)); or
            ``(2) if the project will continue to be owned by a private 
        nonprofit organization owner, such private nonprofit 
        organization owner may enter into a senior preservation rental 
        assistance contract with the Secretary in accordance with 
        subsection (e).
    ``(j) Definition of Private Nonprofit Organization.--For purposes 
of this section, the term `private nonprofit organization' has the 
meaning given such term in section 202(k) of the Housing Act of 1959 
(12 U.S.C. 1701q(k)).''.

                 TITLE III--ASSISTED LIVING FACILITIES

SEC. 301. DEFINITION OF ASSISTED LIVING FACILITY.

    Section 202b(g) of the Housing Act of 1959 (12 U.S.C. 1701q-2(g)) 
is amended by striking paragraph (1) and inserting the following new 
paragraph:
            ``(1) the term `assisted living facility' means a facility 
        that--
                    ``(A) is owned by a private nonprofit organization; 
                and
                    ``(B)(i) is licensed and regulated by the State (or 
                if there is no State law providing for such licensing 
                and regulation by the State, by the municipality or 
                other political subdivision in which the facility is 
                located); or
                    ``(ii)(I) makes available to residents at the 
                resident's request or choice supportive services to 
                assist the residents in carrying out the activities of 
                daily living, such as bathing, dressing, eating, 
                getting in and our of bed or chairs, walking, going 
                outdoors, toileting, laundry, home management, 
                preparing meals, shopping for personal items, obtaining 
                and taking medication, managing money, using the 
                telephone, or performing light of heavy housework, and 
                which may make available to residents home health care 
                service, such as nursing and therapy, and certain 
                health related services; and
                    ``(II) provides separate dwelling units for 
                residents, each of which may contain a full kitchen and 
                bathroom and which includes common rooms and other 
                facilities appropriate for the provision of supportive 
                services to the residents of the facility; and''.

SEC. 302. MONTHLY ASSISTANCE PAYMENT UNDER RENTAL ASSISTANCE.

    Clause (iii) of section 8(o)(18)(B) of the United States Housing 
Act of 1937 (42 U.S.C. 1437f(o)(18)(B)(iii)) is amended by inserting 
before the period at the end the following: ``, except that a family 
may be required at the time the family initially receives such 
assistance to pay rent in an amount exceeding 40 percent of the monthly 
adjusted income of the family by such an amount or percentage as the 
Secretary deems appropriate.''.
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