I 112th CONGRESS 2d Session H. R. 6394 IN THE HOUSE OF REPRESENTATIVES September 13, 2012 Mr. Polis (for himself, Mr. Hinojosa, and Mr. Quigley) introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the Committee on Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To facilitate affordable workforce homeownership in, and develop the full-time resident communities of, high tourism areas, and for other purposes.

1.

Short title

This Act may be cited as the Affordable Housing Regulation Simplification Act of 2012.

2.

Inapplicability of certain Fannie Mae and Freddie Mac guidelines to affordable workforce housing mortgages

(a)

Fannie Mae

Subsection (b) of section 302 of the Federal National Mortgage Association Charter Act (12 U.S.C. 1717(b)) is amended by adding at the end the following new paragraph: (7)

Mortgages for affordable workforce housing

(A)

Exemptions from guidelines

Notwithstanding any other provision of law— (i)the corporation may purchase, service, sell, lend on the security of, and otherwise deal in any affordable workforce housing mortgage; and (ii)any requirements and guidelines of the corporation that are inconsistent with the authority under clause (i) shall not apply to any affordable workforce housing mortgage. (B)

Affordable workforce housing mortgages

For purposes of this paragraph, the term affordable workforce housing mortgage means a mortgage that meets the following requirements: (i)

Property

The mortgage shall be made for the purchase of, and secured by, a one-family residence that— (I)shall be used as the residence of the mortgagor for not less than 8 of any 12 months and 240 days of any 365 days; (II)is located within or is part of a multifamily housing development— (aa)that consists of 5 or more dwelling units or a mixed-use development that is not less than 50 percent residential, as defined in the legal description of the property in the purchase contract or mortgage or title documents relating to such purchase; (bb)of which not less than 25 percent of the dwelling units in the development are owner-occupied; except that the requirement under this item shall be considered to be complied with, with respect to a development, unless verifiable public records indicate an owner-occupancy rate for the development of less than 25 percent; (cc)that provides individual, centralized, or any other method of metering for energy use of the constituent dwelling units; and (dd)that may include dwelling units that are used for the sole purpose of short-term rentals and may provide such services as a staffed front desk, a concierge, or other amenities consistent with providing customer service for non-owner occupied or short-term rental units in the development, including marketing that describes the property as a lodge, resort, or other similar facility; and any multifamily housing development that otherwise complies with the requirements under this subclause may not be considered ineligible because the development or any portion of the development is called or referred to as a condotel, condo-hotel, lodge, or any other title;(III)is subject to resale restrictions that— (aa)are recorded with the appropriate public registry for recording of titles and interests in real estate; and (bb)terminate upon foreclosure or execution of any deed-in-lieu-of-foreclosure; and (IV)is located in an area that, at the time of the origination of the mortgage, is a high tourism area. (ii)

Mortgagor income

The household of the mortgagor shall have a gross household income— (I)that does not exceed 160 percent of the area median income, as determined and updated by the Secretary of Housing and Urban Development or the Director of the Federal Housing Finance Agency on an annual basis; and (II)not less than 75 percent of which is earned from positions the discharge of whose duties involved physical presence in one or more high tourism areas. (iii)

Employment

The mortgagor or another member of the mortgagor’s household— (I)has been employed, during the 6-month period ending upon execution of the mortgage, in a position or multiple positions the discharge of whose duties involved physical presence in one or more high tourism areas, in the aggregate, for an average of not less than 30 hours per week; (II)is employed at the time of the execution of the mortgage in a position or multiple positions the discharge of whose duties involve physical presence in one or more high tourism areas, in the aggregate, for an average of not less than 30 hours per week and the duration of such employment in such position is expected to last at least 6 months; (III)is 60 years of age or older and, during the 5-year period ending up the mortgagor’s retirement from employment was employed in a position or positions the discharge of whose duties involved physical presence in one or more high tourism areas for— (aa)an average of not less than 30 hours per week; and (bb)for not less than 8 months per year; (IV)is a person with disabilities (as such term is defined in section 811(k) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 8013)) who— (aa)was employed, during the 2-year period ending upon becoming disabled, in a position or positions described in subclause (I) or (II); or (bb)is employed in a position or positions described in subclause (I) or (II), except that the 30-hour requirement under such subclauses shall not apply to such person if— (AA)compliance with such requirement would make such person ineligible for benefits made available for persons with disabilities through a program of any State agency for developmental disabilities or through the supplemental security income program under title XVI of the Social Security Act; and (BB)such person works the maximum number of hours per week allowable for eligibility for benefits under such program; or (V)is the head of household in a household that includes one or more dependents, at least one of whom is at the time of the execution of the mortgage 5 years of age or younger or is enrolled full-time in a school in a high tourism area. (iv)

Conforming loan

The original principal obligation of the mortgage shall comply with the applicable dollar amount limitations established pursuant to paragraph (2). (C)

High tourism area

For purposes of this paragraph, the term high tourism area means a county that is designated as a high tourism county pursuant to section 5 of the Affordable Housing Regulation Simplification Act of 2012. . (b)

Freddie Mac

Subsection (a) of section 305 of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)) is amended by adding at the end the following new paragraph: (6)

Mortgages for affordable workforce housing

(A)

Exemptions from guidelines

Notwithstanding any other provision of law— (i)the Corporation may purchase, service, sell, lend on the security of, and otherwise deal in any affordable workforce housing mortgage; and (ii)any requirements and guidelines of the Corporation that are inconsistent with the authority under clause (i) shall not apply to any affordable workforce housing mortgage. (B)

Affordable workforce housing mortgages

For purposes of this paragraph, the term affordable workforce housing mortgage means a mortgage that meets the following requirements: (i)

Property

The mortgage shall be made for the purchase of, and secured by, a one-family residence that— (I)shall be used as the residence of the mortgagor for not less than 8 of any 12 months and 240 days of any 365 days; (II)is located within or is part of a multifamily housing development— (aa)that consists of 5 or more dwelling units or a mixed-use development that is not less than 50 percent residential, as defined in the legal description of the property in the purchase contract or mortgage or title documents relating to such purchase; (bb)of which not less than 25 percent of the dwelling units in the development are owner-occupied; except that the requirement under this item shall be considered to be complied with, with respect to a development, unless verifiable public records indicate an owner-occupancy rate for the development of less than 25 percent; (cc)that provides individual, centralized, or any other method of metering for energy use of the constituent dwelling units; and (dd)that may include dwelling units that are used for the sole purpose of short-term rentals and may provide such services as a staffed front desk, a concierge, or other amenities consistent with providing customer service for non-owner occupied or short-term rental units in the development, including marketing that describes the property as a lodge, resort, or other similar facility; and any multifamily housing development that otherwise complies with the requirements under this subclause may not be considered ineligible because the development or any portion of the development is called or referred to as a condotel, condo-hotel, lodge, or any other title;(III)is subject to resale restrictions that— (aa)are recorded with the appropriate public registry for recording of titles and interests in real estate; and (bb)terminate upon foreclosure or execution of any deed-in-lieu-of-foreclosure; and (IV)is located in an area that, at the time of the origination of the mortgage, is a high tourism area. (ii)

Mortgagor income

The household of the mortgagor shall have a gross household income— (I)that does not exceed 160 percent of the area median income, as determined and updated by the Secretary of Housing and Urban Development or the Director of the Federal Housing Finance Agency on an annual basis; and (II)not less than 75 percent of which is earned from positions the discharge of whose duties involved physical presence in one or more high tourism areas. (iii)

Employment

The mortgagor or another member of the mortgagor’s household— (I)has been employed, during the 6-month period ending upon execution of the mortgage, in a position or multiple positions the discharge of whose duties involved physical presence in one or more high tourism areas, in the aggregate, for an average of not less than 30 hours per week; (II)is employed at the time of the execution of the mortgage in a position or multiple positions the discharge of whose duties involve physical presence in one or more high tourism areas, in the aggregate, for an average of not less than 30 hours per week and the duration of such employment in such position is expected to last at least 6 months; (III)is 60 years of age or older and, during the 5-year period ending up the mortgagor’s retirement from employment was employed in a position or positions the discharge of whose duties involved physical presence in one or more high tourism areas for— (aa)an average of not less than 30 hours per week; and (bb)for not less than 8 months per year; (IV)is a person with disabilities (as such term is defined in section 811(k) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 8013)) who— (aa)was employed, during the 2-year period ending upon becoming disabled, in a position or positions described in subclause (I) or (II); or (bb)is employed in a position or positions described in subclause (I) or (II), except that the 30-hour requirement under such subclauses shall not apply to such person if— (AA)compliance with such requirement would make such person ineligible for benefits made available for persons with disabilities through a program of any State agency for developmental disabilities or through the supplemental security income program under title XVI of the Social Security Act; and (BB)such person works the maximum number of hours per week allowable for eligibility for benefits under such program; or (V)is the head of household in a household that includes one or more dependents, at least one of whom is at the time of the execution of the mortgage 5 years of age or younger or is enrolled full-time in a school in a high tourism area. (iv)

Conforming loan

The original principal obligation of the mortgage shall comply with the applicable dollar amount limitations established pursuant to paragraph (2). (C)

High tourism area

For purposes of this paragraph, the term high tourism area means any county that is designated as a high tourism county pursuant to section 5 of the Affordable Housing Regulation Simplification Act of 2012. .

3.

Insurance of affordable workforce housing mortgages by FHA

Section 203 of the National Housing Act (12 U.S.C. 1709) is amended by adding at the end the following new subsection: (y)

Mortgages for affordable workforce housing

(1)

Insurance authority

The Secretary may insure under this section any affordable workforce housing mortgage meeting the requirements of subsection (b) of this section, except as modified by this subsection. (2)

Exemptions

Notwithstanding any other provision of law, any requirements and guidelines of the Secretary that are inconsistent with the authority under paragraph (1) shall not apply to any affordable workforce housing mortgage. (3)

Affordable workforce housing mortgages

For purposes of this subsection, the term affordable workforce housing mortgage means a mortgage that meets the following requirements: (A)

Property

The mortgage shall be made for the purchase of, and secured by, a one-family residence that— (i)shall be used as the residence of the mortgagor for not less than 8 of any 12 months and 240 days of any 365 days; (ii)is located within or is part of a multifamily housing development— (I)that consists of 5 or more dwelling units or a mixed-use development that is not less than 50 percent residential, as defined in the legal description of the property in the purchase contract or mortgage or title documents relating to such purchase; (II)of which not less than 25 percent of the dwelling units in the development are owner-occupied; except that the requirement under this item shall be considered to be complied with, with respect to a development, unless verifiable public records indicate an owner-occupancy rate for the development of less than 25 percent; (III)that provides individual, centralized, or any other method of metering for energy use of the constituent dwelling units; and (IV)that may include dwelling units that are used for the sole purpose of short-term rentals and may provide such services as a staffed front desk, a concierge, or other amenities consistent with providing customer service for non-owner occupied or short-term rental units in the development, including marketing that describes the property as a lodge, resort, or other similar facility; and any multifamily housing development that otherwise complies with the requirements under this clause may not be considered ineligible because the development or any portion of the development is called or referred to as a condotel, condo-hotel, lodge, or any other title;(iii)is subject to resale restrictions that— (I)are recorded with the appropriate public registry for recording of titles and interests in real estate; and (II)terminate upon foreclosure or execution of any deed-in-lieu-of-foreclosure; and (iv)is located in an area that, at the time of the origination of the mortgage, is a high tourism area. (B)

Mortgagor income

The household of the mortgagor shall have a gross household income— (i)that does not exceed 160 percent of the area median income, as determined and updated by the Secretary on an annual basis; and (ii)not less than 75 percent of which is earned from positions the discharge of whose duties involved physical presence in one or more high tourism areas. (C)

Employment

The mortgagor or another member of the mortgagor’s household— (i)has been employed, during the 6-month period ending upon execution of the mortgage, in a position or multiple positions the discharge of whose duties involved physical presence in one or more high tourism areas, in the aggregate, for an average of not less than 30 hours per week; (ii)is employed at the time of the execution of the mortgage in a position or multiple positions the discharge of whose duties involve physical presence in one or more high tourism areas, in the aggregate, for an average of not less than 30 hours per week and the duration of such employment in such position is expected to last at least 6 months; (iii)is 60 years of age or older and, during the 5-year period ending up the mortgagor’s retirement from employment was employed in a position or positions the discharge of whose duties involved physical presence in one or more high tourism areas for— (I)an average of not less than 30 hours per week; and (II)for not less than 8 months per year; (iv)is a person with disabilities (as such term is defined in section 811(k) of the Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 8013)) who— (I)was employed, during the 2-year period ending upon becoming disabled, in a position or positions described in clause (i) or (ii); or (II)is employed in a position or positions described in clause (i) or (ii), except that the 30-hour requirement under such clauses shall not apply to such person if— (aa)compliance with such requirement would make such person ineligible for benefits made available for persons with disabilities through a program of any State agency for developmental disabilities or through the supplemental security income program under title XVI of the Social Security Act; and (bb)such person works the maximum number of hours per week allowable for eligibility for benefits under such program; or (v)is the head of household in a household that includes one or more dependents, at least one of whom is at the time of the execution of the mortgage 5 years of age or younger or is enrolled full-time in a school in a high tourism area. (D)

Loan limit

The original principal obligation of the mortgage shall comply with the applicable dollar amount limitations under subsection (b)(2). (4)

High tourism area

For purposes of this paragraph, the term high tourism area means any a county that is designated as a high tourism county pursuant to section 5 of the Affordable Housing Regulation Simplification Act of 2012. .

4.

FHA authority for spot approval of mortgages for condominium units

Section 234 of the National Housing Act (12 U.S.C. 1715y) is amended by adding at the end the following new subsection: (l)

Authority for spot approvals

In the case of individual mortgages for one-family units in a multifamily project and an undivided interest in the common areas and facilities that serve the project and affordable workforce housing mortgages (as such term is defined in section 203(y)), the Secretary shall provide an approval process for insurance of such mortgages that does not require prior approval of the entire project or of the homeowners association for the entire project. .

5.

Determination of high tourism areas

The Secretary of Commerce shall, by notice issued not later than December 31, 2013— (1)establish a procedure and metric for assessing, for counties in all States throughout the United States, the economic impact of tourism on such counties; (2)establish a minimum threshold for such economic activity for use for designating counties as high tourism counties; and (3)pursuant to such procedure, metric, and threshold, designate the counties in the United States that are high tourism counties at the time of such designation. The Secretary of Commerce shall reassess and update such designations on a biennial basis.