[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 2162 Introduced in Senate (IS)]

112th CONGRESS
  2d Session
                                S. 2162

   To provide for the redevelopment of abandoned and foreclosed-upon 
properties and for the stabilization of affected neighborhoods, and for 
                            other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 6, 2012

Mr. Reed (for himself, Mr. Durbin, Mr. Schumer, Mr. Leahy, Mr. Brown of 
    Ohio, Mr. Whitehouse, Mr. Merkley, Mr. Begich, Mr. Franken, Mr. 
  Blumenthal, and Mr. Akaka) introduced the following bill; which was 
read twice and referred to the Committee on Banking, Housing, and Urban 
                                Affairs

_______________________________________________________________________

                                 A BILL


 
   To provide for the redevelopment of abandoned and foreclosed-upon 
properties and for the stabilization of affected neighborhoods, 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 ``Project Rebuild Act''.

SEC. 2. PROJECT REBUILD.

    (a) Direct Appropriations.--There is appropriated, out of any money 
in the Treasury not otherwise appropriated, $15,000,000,000, to remain 
available until September 30, 2016, for assistance to eligible entities 
including States and units of general local government (as such terms 
are defined in section 102 of the Housing and Community Development Act 
of 1974 (42 U.S.C. 5302)), and qualified nonprofit organizations, 
businesses or consortia of eligible entities for the redevelopment of 
abandoned and foreclosed-upon properties and for the stabilization of 
affected neighborhoods.
    (b) Allocation of Appropriated Amounts.--
            (1) In general.--Of the amounts appropriated, two-thirds 
        shall be allocated to States and units of general local 
        government based on a funding formula established by the 
        Secretary of Housing and Urban Development (in this section 
        referred to as the ``Secretary''). Of the amounts appropriated, 
        one-third shall be distributed competitively to eligible 
        entities.
            (2) Formula to be devised swiftly.--The funding formula 
        required under paragraph (1) shall be established and the 
        Secretary shall announce formula funding allocations, not later 
        than 30 days after the date of the enactment of this Act.
            (3) Formula criteria.--The Secretary may establish a 
        minimum grant size, and the funding formula required under 
        paragraph (1) shall ensure that any amounts appropriated or 
        otherwise made available under this section are allocated to 
        States and units of general local government with the greatest 
        need, as such need is determined in the discretion of the 
        Secretary based on--
                    (A) the number and percentage of home foreclosures 
                in each State or unit of general local government;
                    (B) the number and percentage of homes in default 
                or delinquency in each State or unit of general local 
                government; and
                    (C) other factors such as established program 
                designs, grantee capacity and performance, number and 
                percentage of commercial foreclosures, overall economic 
                conditions, and other market needs data, as determined 
                by the Secretary.
            (4) Competition criteria.--
                    (A) Eligible entities.--For the funds distributed 
                competitively, eligible entities shall be States, units 
                of general local government, nonprofit entities, for-
                profit entities, and consortia of eligible entities 
                that demonstrate capacity to use funding within the 
                period of this program.
                    (B) Award criteria.--In selecting grantees, the 
                Secretary shall ensure that grantees are in areas with 
                the greatest number and percentage of residential and 
                commercial foreclosures and other market needs data, as 
                determined by the Secretary. Additional award criteria 
                shall include demonstrated grantee capacity to execute 
                projects involving acquisition and rehabilitation or 
                redevelopment of foreclosed residential and commercial 
                property and neighborhood stabilization, leverage, 
                knowledge of market conditions and of effective 
                stabilization activities to address identified 
                conditions, and any additional factors determined by 
                the Secretary.
                    (C) Grant size.--The Secretary may establish a 
                minimum grant size.
                    (D) Publication of criteria; application due 
                date.--The Secretary shall publish competition criteria 
                for any grants awarded under this section not later 
                than 60 days after the appropriation of funds, and 
                applications shall be due to the Secretary within 120 
                days.
    (c) Use of Funds.--
            (1) Obligation and expenditure.--The Secretary shall 
        obligate all formula funding within 120 days of the date of the 
        enactment of this Act and all competitive grant funding within 
        180 days of such enactment date. Any eligible entity that 
        receives amounts pursuant to this section shall expend all 
        funds allocated to it within three years of the date the funds 
        become available to the grantee for obligation. Furthermore, 
        the Secretary shall by Notice establish intermediate 
        expenditure benchmarks at the one and two year dates from the 
        date the funds become available to the grantee for obligation.
            (2) Priorities.--
                    (A) Job creation.--Each grantee or eligible entity 
                shall describe how its proposed use of funds will 
                prioritize job creation, and secondly, will address 
                goals to stabilize neighborhoods, reduce vacancy, or 
                increase or stabilize residential and commercial 
                property values.
                    (B) Targeting.--Any State or unit of general local 
                government that receives formula amounts pursuant to 
                this section shall, in distributing and targeting such 
                amounts, give priority emphasis and consideration to 
                those metropolitan areas, metropolitan cities, urban 
                areas, rural areas, low- and moderate-income areas, and 
                other areas with the greatest need, including those--
                            (i) with the greatest percentage of home 
                        foreclosures;
                            (ii) identified as likely to face a 
                        significant rise in the rate of residential or 
                        commercial foreclosures; and
                            (iii) with a higher than national average 
                        unemployment rate.
                In addition, such priority emphasis and consideration 
                may be given to such areas that have lost occupiable 
                housing stock within the 3-year period ending with the 
                date of the enactment of this Act due to the effects of 
                presidentially declared disasters.
                    (C) Leverage.--Each grantee or eligible entity 
                shall describe how its proposed use of funds will 
                leverage private funds.
            (3) Eligible uses.--Amounts made available under this 
        section may be used to--
                    (A) establish financing mechanisms for the purchase 
                and redevelopment of abandoned and foreclosed-upon 
                properties, including such mechanisms as soft-seconds, 
                loan loss reserves, and shared-equity loans for low- 
                and moderate-income homebuyers;
                    (B) purchase and rehabilitate properties that have 
                been abandoned or foreclosed upon, in order to sell, 
                rent, or redevelop such properties;
                    (C) establish and operate land banks for properties 
                that have been abandoned, demolished, severely damaged 
                by presidentially declared disasters, or foreclosed 
                upon;
                    (D) demolish blighted structures;
                    (E) redevelop abandoned, foreclosed, demolished, or 
                vacant properties; and
                    (F) engage in other activities, as determined by 
                the Secretary through notice, that are consistent with 
                the goals of creating jobs, stabilizing neighborhoods, 
                reducing vacancy, increasing or stabilizing residential 
                and commercial property values, and providing 
                assistance to homeowners and landlords recovering after 
                presidentially declared disasters.
    (d) Limitations.--
            (1) On purchases.--Any purchase of a property under this 
        section shall be at a price not to exceed its current market 
        value, taking into account its current condition.
            (2) Rehabilitation.--Any rehabilitation of an eligible 
        property under this section shall be to the extent necessary to 
        comply with applicable laws, and other requirements relating to 
        safety, quality, marketability, and habitability, in order to 
        sell, rent, or redevelop such properties or provide a renewable 
        energy source or sources for such properties.
            (3) Sale of homes.--If an abandoned or foreclosed-upon home 
        is purchased, redeveloped, or otherwise sold to an individual 
        as a primary residence, then such sale shall be in an amount 
        equal to or less than the cost to acquire and redevelop or 
        rehabilitate such home or property up to a decent, safe, 
        marketable, and habitable condition.
            (4) On demolition of public housing.--Public housing, as 
        defined in section 3(b)(1) of the United States Housing Act of 
        1937 (42 U.S.C. 1437a(b)(1)), may not be demolished with funds 
        under this section.
            (5) On demolition activities.--No more than 10 percent of 
        any grant made under this section may be used for demolition 
        activities unless the Secretary determines that such use 
        represents an appropriate response to local market conditions 
        or is necessary as a result of a presidentially declared 
        disaster.
            (6) On use of funds for non-residential property.--No more 
        than 30 percent of any grant made under this section may be 
        used for eligible activities under subparagraphs (A), (B), and 
        (E) of subsection (c)(3) that will not result in residential 
        use of the property involved unless the Secretary determines 
        that such use represents an appropriate response to local 
        market conditions.
            (7) General use of funds.--Each formula and competitive 
        grantee is required to ensure that all use of formula or 
        competitive funds by the grantee are properly underwritten and 
        reviewed in order to prevent fraud, waste, and abuse.
    (e) Rules of Construction.--
            (1) In general.--Except as otherwise provided by this 
        section, amounts appropriated, revenues generated, or amounts 
        otherwise made available to eligible entities under this 
        section shall be treated as though such funds were community 
        development block grant funds under title I of the Housing and 
        Community Development Act of 1974 (42 U.S.C. 5301 et seq.).
            (2) No match.--No matching funds shall be required in order 
        for an eligible entity to receive any amounts under this 
        section.
            (3) Tenant protections.--An eligible entity receiving a 
        grant under this section shall comply with the 14th, 17th, 
        18th, 19th, 20th, 21st, 22nd and 23rd provisos in the second 
        undesignated paragraph under the heading ``Community Planning 
        and Development--Community Development Fund'' in title XII of 
        division A of the American Recovery and Reinvestment Act of 
        2009 (Public Law 111-5, 123 Stat. 218-19), as amended by 
        section 1497(b)(2) of the Dodd-Frank Wall Street Reform and 
        Consumer Protection Act (Public Law 111-203, 124 Stat. 2211).
            (4) Vicinity hiring.--An eligible entity receiving a grant 
        under this section shall comply with section 1497(a)(8) of the 
        Dodd-Frank Wall Street Reform and Consumer Protection Act 
        (Public Law 111-203, 124 Stat. 2210).
            (5) Buy american.--Section 1605 of title XVI of division A 
        of the American Recovery and Reinvestment Act of 2009 (Public 
        Law 111-5, 123 Stat. 303) shall apply to amounts appropriated, 
        revenues generated, and amounts otherwise made available to 
        eligible entities under this section.
    (f) Authority To Specify Alternative Requirements.--
            (1) In general.--In administering the program under this 
        section, the Secretary may specify alternative requirements to 
        any provision under title I of the Housing and Community 
        Development Act of 1974 (42 U.S.C. 5301 et seq.) or under title 
        I of the Cranston-Gonzalez National Affordable Housing Act (42 
        U.S.C. 12701 et seq.) (except for those provisions in these 
        laws related to fair housing, nondiscrimination, labor 
        standards, and the environment) for the purpose of expediting 
        and facilitating the use of funds under this section.
            (2) Notice.--The Secretary shall provide written notice of 
        intent to the public via Internet to exercise the authority to 
        specify alternative requirements under paragraph (1).
            (3) Low and moderate income requirement.--
                    (A) In general.--Notwithstanding the authority of 
                the Secretary under paragraph (1)--
                            (i) all of the formula and competitive 
                        grantee funds appropriated or otherwise made 
                        available under this section shall be used with 
                        respect to individuals and families whose 
                        income does not exceed 120 percent of area 
                        median income; and
                            (ii) not less than 25 percent of the 
                        formula and competitive grantee funds 
                        appropriated or otherwise made available under 
                        this section shall be used for the purchase and 
                        redevelopment of eligible properties that will 
                        be used to house individuals or families whose 
                        incomes do not exceed 50 percent of area median 
                        income.
                    (B) Recurrent requirement.--The Secretary shall, by 
                rule or order, ensure, to the maximum extent 
                practicable and for the longest feasible term, that the 
                sale, rental, or redevelopment of abandoned and 
                foreclosed-upon homes and residential properties under 
                this section remain affordable to individuals or 
                families described in subparagraph (A).
    (g) Nationwide Distribution of Resources.--Notwithstanding any 
other provision of this section, each State shall receive not less than 
$20,000,000 of formula funds.
    (h) Limitation on Use of Funds With Respect to Eminent Domain.--No 
State or unit of general local government may use any amounts received 
pursuant to this section to fund any project that seeks to use the 
power of eminent domain, unless eminent domain is employed only for a 
public use, which shall not be construed to include economic 
development that primarily benefits private entities.
    (i) Limitation on Distribution of Funds.--
            (1) In general.--None of the funds made available under 
        this section shall be distributed to--
                    (A) an organization which has been indicted for a 
                violation under Federal law relating to an election for 
                Federal office; or
                    (B) an organization which employs applicable 
                individuals.
            (2) Applicable individuals defined.--In this section, the 
        term ``applicable individual'' means an individual who--
                    (A) is--
                            (i) employed by the organization in a 
                        permanent or temporary capacity;
                            (ii) contracted or retained by the 
                        organization; or
                            (iii) acting on behalf of, or with the 
                        express or apparent authority of, the 
                        organization; and
                    (B) has been indicted for a violation under Federal 
                law relating to an election for Federal office.
    (j) Rental Housing Preferences.--Each State and local government 
receiving formula amounts shall establish procedures to create 
preferences for the development of affordable rental housing.
    (k) Job Creation.--If a grantee chooses to use funds to create jobs 
by establishing and operating a program to maintain eligible 
neighborhood properties, not more than 10 percent of any grant may be 
used for that purpose.
    (l) Program Support and Capacity Building.--The Secretary may use 
an overall amount up to 0.75 percent of the funds appropriated for 
capacity building of and support for eligible entities and grantees 
undertaking neighborhood stabilization programs, staffing, training, 
technical assistance, technology, monitoring, travel, enforcement, 
research and evaluation activities. In addition--
            (1) funds set aside for the purposes of this subsection 
        shall remain available until September 30, 2016;
            (2) any funds made available under this subsection and used 
        by the Secretary for personnel, training, or other 
        administrative expenses related to administering funding under 
        this subsection shall be transferred to ``Program Office 
        Salaries and Expenses, Community Planning and Development'';
            (3) any funds made available under this subsection and used 
        by the Secretary for technology shall be transferred to 
        ``Working Capital Fund''; and
            (4) an amount up to 0.10 percent of the funds appropriated 
        shall be transferred to the Office of Inspector General, 
        Department of Housing and Urban Development and such overall 
        amount described in this subsection shall be reduced by the 
        amount specified in this paragraph.
    (m) Enforcement and Prevention of Fraud and Abuse.--The Secretary 
shall establish and implement procedures to prevent fraud and abuse of 
funds under this section, and shall impose a requirement that grantees 
have an internal auditor to continuously monitor grantee performance to 
prevent fraud, waste, and abuse. Grantees shall provide the Secretary 
and citizens with quarterly progress reports. The Secretary shall 
recapture funds from formula and competitive grantees that do not 
expend 100 percent of allocated funds within 3 years of the date that 
funds become available, and from underperforming or mismanaged 
grantees, and shall re-allocate those funds by formula to target areas 
with the greatest need, as determined by the Secretary through notice. 
The Secretary may take an alternative sanctions action only upon 
determining that such action is necessary to achieve program goals in a 
timely manner.
    (n) Policies and Procedures for Grants.--The Secretary of Housing 
and Urban Development shall to the extent feasible conform policies and 
procedures for grants made under this section to the policies and 
procedures already in place for the grants made under section 2301 of 
the Housing and Economic Recovery Act of 2008 (Public Law 110-289, 122 
Stat. 2850); title XII of division A of the American Recovery and 
Reinvestment Act of 2009 (Public Law 111-5, 123 Stat. 217); or section 
1497 of the Dodd-Frank Wall Street Reform and Consumer Protection Act 
(Public Law 111-203, 124 Stat. 2209).

SEC. 3. WAGE RATE AND EMPLOYMENT PROTECTION REQUIREMENTS.

    Amounts appropriated, revenues generated, and amounts otherwise 
made available under this Act shall be subject to the requirements of 
section 110 of the Housing and Community Development Act of 1974 (42 
U.S.C. 5310) or to a waiver thereof under section 107(e)(2) of such Act 
(42 U.S.C. 5307(e)(2)).
                                 <all>