[House Report 105-297]
[From the U.S. Government Publishing Office]



105th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 1st Session                                                    105-297
_______________________________________________________________________


 
   MAKING APPROPRIATIONS FOR THE DEPARTMENTS OF VETERANS AFFAIRS AND 
  HOUSING AND URBAN DEVELOPMENT, AND FOR SUNDRY INDEPENDENT AGENCIES, 
   COMMISSIONS, CORPORATIONS, AND OFFICES FOR THE FISCAL YEAR ENDING 
               SEPTEMBER 30, 1998, AND FOR OTHER PURPOSES

                                _______
                                

                October 6, 1997.--Ordered to be printed

_______________________________________________________________________


 Mr. Lewis of California, from the committee of conference, submitted 
                             the following

                           CONFERENCE REPORT

                        [To accompany H.R. 2158]

      The committee of conference on the disagreeing votes of 
the two Houses on the amendment of the Senate to the bill (H.R. 
2158) ``making appropriations for the Departments of Veterans 
Affairs and Housing and Urban Development, and for sundry 
independent agencies, commissions, corporations, and offices 
for the fiscal year ending September 30, 1998, and for other 
purposes,'' having met, after full and free conference, have 
agreed to recommend and do recommend to their respective Houses 
as follows:
      That the House recede from its disagreement to the 
amendment of the Senate, and agree to the same with an 
amendment, as follows:
      In lieu of the matter stricken and inserted by said 
amendment, insert:

That the following sums are appropriated, out of any money in 
the Treasury not otherwise appropriated, for the Departments of 
Veterans Affairs and Housing and Urban Development, and for 
sundry independent agencies, commissions, corporations, and 
offices for the fiscal year ending September 30, 1998, and for 
other purposes, namely:


                TITLE I--DEPARTMENT OF VETERANS AFFAIRS

                    Veterans Benefits Administration


                       compensation and pensions


                     (including transfers of funds)


    For the payment of compensation benefits to or on behalf of 
veterans and a pilot program for disability examinations as 
authorized by law (38 U.S.C. 107, chapters 11, 13, 18, 51, 53, 
55, and 61); pension benefits to or on behalf of veterans as 
authorized by law (38 U.S.C. chapters 15, 51, 53, 55, and 61; 
92 Stat. 2508); and burial benefits, emergency and other 
officers' retirement pay, adjusted-service credits and 
certificates, payment of premiums due on commercial life 
insurance policies guaranteed under the provisions of Article 
IV of the Soldiers' and Sailors' Civil Relief Act of 1940, as 
amended, and for other benefits as authorized by law (38 U.S.C. 
107, 1312, 1977, and 2106, chapters 23, 51, 53, 55, and 61; 50 
U.S.C. App. 540-548; 43 Stat. 122, 123; 45 Stat. 735; 76 Stat. 
1198); $19,932,997,000, to remain available until expended: 
Provided, That not to exceed $26,380,000 of the amount 
appropriated shall be reimbursed to ``General operating 
expenses'' and ``Medical care'' for necessary expenses in 
implementing those provisions authorized in the Omnibus Budget 
Reconciliation Act of 1990, and in the Veterans' Benefits Act 
of 1992 (38 U.S.C. chapters 51, 53, and 55), the funding source 
for which is specifically provided as the ``Compensation and 
pensions'' appropriation: Provided further, That such sums as 
may be earned on an actual qualifying patient basis, shall be 
reimbursed to ``Medical facilities revolving fund'' to augment 
the funding of individual medical facilities for nursing home 
care provided to pensioners as authorized by the Veterans' 
Benefits Act of 1992 (38 U.S.C. chapter 55).


                         readjustment benefits


    For the payment of readjustment and rehabilitation benefits 
to or on behalf of veterans as authorized by 38 U.S.C. chapters 
21, 30, 31, 34, 35, 36, 39, 51, 53, 55, and 61, $1,366,000,000, 
to remain available until expended: Provided, That funds shall 
be available to pay any court order, court award or any 
compromise settlement arising from litigation involving the 
vocational training program authorized by section 18 of Public 
Law 98-77, as amended.


                   veterans insurance and indemnities


    For military and naval insurance, national service life 
insurance, servicemen's indemnities, service-disabled veterans 
insurance, and veterans mortgage life insurance as authorized 
by 38 U.S.C. chapter 19; 70 Stat. 887; 72Stat. 487, 
$51,360,000, to remain available until expended.


         veterans housing benefit program fund program account


                     (including transfer of funds)


    For the cost of direct and guaranteed loans, such sums as 
may be necessary to carry out the program, as authorized by 38 
U.S.C. chapter 37, as amended: Provided, That such costs, 
including the cost of modifying such loans, shall be as defined 
in section 502 of the Congressional Budget Act of 1974, as 
amended: Provided further, That during fiscal year 1998, within 
the resources available, not to exceed $300,000 in gross 
obligations for direct loans are authorized for specially 
adapted housing loans: Provided further, That during 1998 any 
moneys that would be otherwise deposited into or paid from the 
Loan Guaranty Revolving Fund, the Guaranty and Indemnity Fund, 
or the Direct Loan Revolving Fund shall be deposited into or 
paid from the Veterans Housing Benefit Program Fund: Provided 
further, That any balances in the Loan Guaranty Revolving Fund, 
the Guaranty and Indemnity Fund, or the Direct Loan Revolving 
Fund on the effective date of this Act may be transferred to 
and merged with the Veterans Housing Benefit Program Fund.
    In addition, for administrative expenses to carry out the 
direct and guaranteed loan programs, $160,437,000, which may be 
transferred to and merged with the appropriation for ``General 
operating expenses''.


                  education loan fund program account


                     (including transfer of funds)


    For the cost of direct loans, $1,000, as authorized by 38 
U.S.C. 3698, as amended: Provided, That such costs, including 
the cost of modifying such loans, shall be as defined in 
section 502 of the Congressional Budget Act of 1974, as 
amended: Provided further, That these funds are available to 
subsidize gross obligations for the principal amount of direct 
loans not to exceed $3,000.
    In addition, for administrative expenses necessary to carry 
out the direct loan program, $200,000, which may be transferred 
to and merged with the appropriation for ``General operating 
expenses''.


            vocational rehabilitation loans program account


                     (including transfer of funds)


    For the cost of direct loans, $44,000, as authorized by 38 
U.S.C. chapter 31, as amended: Provided, That such costs, 
including the cost of modifying such loans, shall be as defined 
in section 502 of the Congressional Budget Act of 1974, as 
amended: Provided further, That these funds are available to 
subsidize gross obligations for the principal amount of direct 
loans not to exceed $2,278,000.
    In addition, for administrative expenses necessary to carry 
out the direct loan program, $388,000, which may be transferred 
to and merged with the appropriation for ``General operating 
expenses''.


          native american veteran housing loan program account


                     (including transfer of funds)


    For administrative expenses to carry out the direct loan 
program authorized by 38 U.S.C. chapter 37, subchapter V, as 
amended, $515,000, which may be transferred to and merged with 
the appropriation for ``General operating expenses''.

                     Veterans Health Administration


                              medical care


                     (including transfer of funds)


    For necessary expenses for the maintenance and operation of 
hospitals, nursing homes, and domiciliary facilities; for 
furnishing, as authorized by law, inpatient and outpatient care 
and treatment to beneficiaries of the Department of Veterans 
Affairs, including care and treatment in facilities not under 
the jurisdiction of the Department; and furnishing recreational 
facilities, supplies, and equipment; funeral, burial, and other 
expenses incidental thereto for beneficiaries receiving care in 
the Department; administrative expenses in support of planning, 
design, project management, real property acquisition and 
disposition, construction and renovation of any facility under 
the jurisdiction or for the use of the Department; 
oversight,engineering and architectural activities not charged to 
project cost; repairing, altering, improving or providing facilities in 
the several hospitals and homes under the jurisdiction of the 
Department, not otherwise provided for, either by contract or by the 
hire of temporary employees and purchase of materials; uniforms or 
allowances therefor, as authorized by 5 U.S.C. 5901-5902; aid to State 
homes as authorized by 38 U.S.C. 1741; administrative and legal 
expenses of the Department for collecting and recovering amounts owed 
the Department as authorized under 38 U.S.C. chapter 17, and the 
Federal Medical Care Recovery Act, 42 U.S.C. 2651 et seq.; and not to 
exceed $8,000,000 to fund cost comparison studies as referred to in 38 
U.S.C. 8110(a)(5); $17,057,396,000, plus reimbursements: Provided, That 
of the funds made available under this heading, $570,000,000 is for the 
equipment and land and structures object classifications only, which 
amount shall not become available for obligation until August 1, 1998, 
and shall remain available until September 30, 1999: Provided further, 
That of the amount made available under this heading, not to exceed 
$5,000,000 shall be for a study on the cost-effectiveness of 
contracting with local hospitals in East Central Florida for the 
provision of non-emergent inpatient health care needs of veterans.
    In addition, in conformance with Public Law 105-33 
establishing the Department of Veterans Affairs Medical Care 
Collections Fund, such sums as may be deposited to such Fund 
pursuant to 38 U.S.C. 1729A may be transferred to this account, 
to remain available until expended for the purposes of this 
account.


                    medical and prosthetic research


    For necessary expenses in carrying out programs of medical 
and prosthetic research and development as authorized by 38 
U.S.C. chapter 73, to remain available until September 30, 
1999, $272,000,000, plus reimbursements.


      medical administration and miscellaneous operating expenses


    For necessary expenses in the administration of the 
medical, hospital, nursing home, domiciliary, construction, 
supply, and research activities, as authorized by law; 
administrative expenses in support of planning, design, project 
management, architectural, engineering, real property 
acquisition and disposition, construction and renovation of any 
facility under the jurisdiction or for the use of the 
Department of Veterans Affairs, including site acquisition; 
engineering and architectural activities not charged to project 
cost; and research and development in building construction 
technology; $59,860,000, plus reimbursements.

                   general post fund, national homes


                     (including transfer of funds)


    For the cost of direct loans, $7,000, as authorized by 
Public Law 102-54, section 8, which shall be transferred from 
the ``General post fund'': Provided, That such costs, including 
the cost of modifying such loans, shall be as defined in 
section 502 of the Congressional Budget Act of 1974, as 
amended: Provided further, That these funds are available to 
subsidize gross obligations for the principal amount of direct 
loans not to exceed $70,000.
    In addition, for administrative expenses to carry out the 
direct loan programs, $54,000, which shall be transferred from 
the ``General post fund'', as authorized by Public Law 102-54, 
section 8.

                      Departmental Administration


                       general operating expenses


    For necessary operating expenses of the Department of 
Veterans Affairs, not otherwise provided for, including 
uniforms or allowances therefor; not to exceed $25,000 for 
official reception and representation expenses; hire of 
passenger motor vehicles; and reimbursement of the General 
Services Administration for security guard services, and the 
Department of Defense for the cost of overseas employee mail; 
$786,135,000: Provided, That funds under this heading shall be 
available to administer the ServiceMembers Occupational 
Conversion and Training Act: Provided further, That none of the funds 
made available under this heading may be used for the relocation of the 
loan guaranty divisions of the Department of Veterans Affairs Regional 
Office in St. Petersburg, Florida to the Department of Veterans Affairs 
Regional Office in Atlanta, Georgia.


                        national cemetery system


    For necessary expenses for the maintenance and operation of 
the National Cemetery System, not otherwise provided for, 
including uniforms or allowances therefor; cemeterial expenses 
as authorized by law; purchase of three passenger motor 
vehicles for use in cemeterial operations; and hire of 
passenger motor vehicles, $84,183,000.


                      office of inspector general


    For necessary expenses of the Office of Inspector General 
in carrying out the Inspector General Act of 1978, as amended, 
$31,013,000.


                      construction, major projects


    For constructing, altering, extending and improving any of 
the facilities under the jurisdiction or for the use of the 
Department of Veterans Affairs, or for any of the purposes set 
forth in sections 316, 2404, 2406, 8102, 8103, 8106, 8108, 
8109, 8110, and 8122 of title 38, United States Code, including 
planning, architectural and engineering services, maintenance 
or guarantee period services costs associated with equipment 
guarantees provided under the project, services of claims 
analysts, offsite utility and storm drainage system 
construction costs, and site acquisition, where the estimated 
cost of a project is $4,000,000 or more or where funds for a 
project were made available in a previous major project 
appropriation, $177,900,000, to remain available until 
expended: Provided, That the $32,100,000 provided under this 
heading in Public Law 104-204 for the replacement hospital at 
Travis Air Force Base, Fairfield, CA, shall not be obligated 
for that purpose but shall be available for any project 
approved by the Congress in the budgetary process: Provided 
further, That except for advance planning of projects funded 
through the advance planning fund and the design of projects 
funded through the design fund, none of these funds shall be 
used for any project which has not been considered and approved 
by the Congress in the budgetary process: Provided further, 
That funds provided in this appropriation for fiscal year 1998, 
for each approved project shall be obligated (1) by the 
awarding of a construction documents contract by September 30, 
1998, and (2) by the awarding of a construction contract by 
September 30, 1999: Provided further, That the Secretary shall 
promptly report in writing to the Committees on Appropriations 
any approved major construction project in which obligations 
are not incurred within the time limitations established above: 
Provided further, That no funds from any other account except 
the ``Parking revolving fund'', may be obligated for 
constructing, altering, extending, or improving a project which 
was approved in the budget process and funded in this account 
until one year after substantial completion and beneficial 
occupancy by the Department of Veterans Affairs of the project 
or any part thereof with respect to that part only.


                      construction, minor projects


    For constructing, altering, extending, and improving any of 
the facilities under the jurisdiction or for the use of the 
Department of Veterans Affairs, including planning, 
architectural and engineering services, maintenance or 
guarantee period services costs associated with equipment 
guarantees provided under the project, services of claims 
analysts, offsite utility and storm drainage system 
construction costs, and site acquisition, or for any of the 
purposes set forth in sections 316, 2404, 2406, 8102, 8103, 
8106, 8108, 8109, 8110, and 8122 of title 38, United States 
Code, where the estimated cost of a project is less than 
$4,000,000; $175,000,000, to remain available until expended, 
along with unobligated balances of previous ``Construction, 
minor projects'' appropriations which are hereby made available 
for any project where the estimated cost is less than 
$4,000,000: Provided, That fundsin this account shall be 
available for (1) repairs to any of the nonmedical facilities under the 
jurisdiction or for the use of the Department which are necessary 
because of loss or damage caused by any natural disaster or 
catastrophe, and (2) temporary measures necessary to prevent or to 
minimize further loss by such causes.


                         parking revolving fund


    For the parking revolving fund as authorized by 38 U.S.C. 
8109, income from fees collected, to remain available until 
expended, which shall be available for all authorized expenses 
except operations and maintenance costs, which will be funded 
from ``Medical care''.


       grants for construction of state extended care facilities


    For grants to assist States to acquire or construct State 
nursing home and domiciliary facilities and to remodel, modify 
or alter existing hospital, nursing home and domiciliary 
facilities in State homes, for furnishing care to veterans as 
authorized by 38 U.S.C. 8131-8137, $80,000,000, to remain 
available until expended.


        grants for the construction of state veteran cemeteries


    For grants to aid States in establishing, expanding, or 
improving State veteran cemeteries as authorized by 38 U.S.C. 
2408, $10,000,000, to remain available until expended.


                       administrative provisions


                     (including transfer of funds)


    Sec. 101. Any appropriation for fiscal year 1998 for 
``Compensation and pensions'', ``Readjustment benefits'', and 
``Veterans insurance and indemnities'' may be transferred to 
any other of the mentioned appropriations.
    Sec. 102. Appropriations available to the Department of 
Veterans Affairs for fiscal year 1998 for salaries and expenses 
shall be available for services authorized by 5 U.S.C. 3109.
    Sec. 103. No appropriations in this Act for the Department 
of Veterans Affairs (except the appropriations for 
``Construction, major projects'', ``Construction, minor 
projects'', and the ``Parking revolving fund'') shall be 
available for the purchase of any site for or toward the 
construction of any new hospital or home.
    Sec. 104. No appropriations in this Act for the Department 
of Veterans Affairs shall be available for hospitalization or 
examination of any persons (except beneficiaries entitled under 
the laws bestowing such benefits to veterans, and persons 
receiving such treatment under 5 U.S.C. 7901-7904 or 42 U.S.C. 
5141-5204), unless reimbursement of cost is made to the 
``Medical care'' account at such rates as may be fixed by the 
Secretary of Veterans Affairs.
    Sec. 105. Appropriations available to the Department of 
Veterans Affairs for fiscal year 1998 for ``Compensation and 
pensions'', ``Readjustment benefits'', and ``Veterans insurance 
and indemnities'' shall be available for payment of prior year 
accrued obligations required to be recorded by law against the 
corresponding prior year accounts within the last quarter of 
fiscal year 1997.
    Sec. 106. Appropriations accounts available to the 
Department of Veterans Affairs for fiscal year 1998 shall be 
available to pay prior year obligations of corresponding prior 
year appropriations accounts resulting from title X of the 
Competitive Equality Banking Act, Public Law 100-86, except 
that if such obligations are from trust fund accounts they 
shall be payable from ``Compensation and pensions''.
    Sec. 107. Notwithstanding any other provision of law, 
during fiscal year 1998, the Secretary of Veterans Affairs 
shall, from the National Service Life Insurance Fund (38 U.S.C. 
1920), the Veterans' Special Life Insurance Fund (38 U.S.C. 
1923), and the United States Government Life Insurance Fund (38 
U.S.C. 1955), reimburse the ``General operating expenses'' 
account for the cost of administration of the insurance 
programs financed through those accounts: Provided, That 
reimbursement shall be made only from the surplus earnings 
accumulatedin an insurance program in fiscal year 1998, that 
are available for dividends in that program after claims have been paid 
and actuarially determined reserves have been set aside: Provided 
further, That if the cost of administration of an insurance program 
exceeds the amount of surplus earnings accumulated in that program, 
reimbursement shall be made only to the extent of such surplus 
earnings: Provided further, That the Secretary shall determine the cost 
of administration for fiscal year 1998, which is properly allocable to 
the provision of each insurance program and to the provision of any 
total disability income insurance included in such insurance program.
    Sec. 108. Section 214(l)(1)(D) of the Immigration and 
Nationality Act (8 U.S.C. 1184(l)(1)(D)) (as added by section 
220 of the Immigration and Nationality Technical Corrections 
Act of 1994 and redesignated as subsection (l) by section 
671(a)(3)(A) of the Illegal Immigration Reform and Immigrant 
Responsibility Act of 1996) is amended by inserting before the 
period at the end the following: ``, except that, in the case 
of a request by the Department of Veterans Affairs, the alien 
shall not be required to practice medicine in a geographic area 
designated by the Secretary''.
    Sec. 109. In accordance with section 1557 of title 31, 
United States Code, the following obligated balance shall be 
exempt from subchapter IV of chapter 15 of such title and shall 
remain available for expenditure without fiscal year 
limitation: Funds obligated by the Department of Veterans 
Affairs for lease number 757-084B-001-91 from funds made 
available in the Departments of Veterans Affairs and Housing 
and Urban Development, and Independent Agencies Appropriations 
Act, 1993 (Public Law 102-389) under the heading ``Medical 
care''.

         TITLE II--DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

                       Public and Indian Housing


                        housing certificate fund


                     (including transfers of funds)


    For activities and assistance to prevent the involuntary 
displacement of low-income families, the elderly and the 
disabled because of the loss of affordable housing stock, 
expiration of subsidy contracts (other than contracts for which 
amounts are provided under another heading in this Act) or 
expiration of use restrictions, or other changes in housing 
assistance arrangements, and for other purposes, 
$9,373,000,000, to remain available until expended: Provided, 
That of the total amount provided under this heading, 
$8,180,000,000 shall be for assistance under the United States 
Housing Act of 1937 (42 U.S.C. 1437) for use in connection with 
expiring or terminating section 8 subsidy contracts, for 
enhanced vouchers as provided under the ``Preserving Existing 
Housing Investment'' account in the Departments of Veterans 
Affairs and Housing and Urban Development, and Independent 
Agencies Appropriations Act, 1997, (Public Law 104-204), and 
contracts entered into pursuant to section 441 of the Stewart 
B. McKinney Homeless Assistance Act: Provided further, That the 
Secretary may determine not to apply section 8(o)(6)(B) of the 
Act to housing vouchers during fiscalyear 1998: Provided 
further, That of the total amount provided under this head, 
$850,000,000 shall be for amendments to section 8 contracts other than 
contracts for projects developed under section 202 of the Housing Act 
of 1959, as amended: Provided further, That of the total amount 
provided under this heading, $343,000,000 shall be for section 8 rental 
assistance under the United States Housing Act of 1937 including 
assistance to relocate residents of properties (i) that are owned by 
the Secretary and being disposed of or (ii) that are discontinuing 
section 8 project-based assistance; for the conversion of section 23 
projects to assistance under section 8; for funds to carry out the 
family unification program; and for the relocation of witnesses in 
connection with efforts to combat crime in public and assisted housing 
pursuant to a request from a law enforcement or prosecution agency: 
Provided further, That of the total amount made available in the 
preceding proviso, $40,000,000 shall be made available to nonelderly 
disabled families affected by the designation of a public housing 
development under section 7 of such Act, the establishment of 
preferences in accordance with section 651 of the Housing and Community 
Development Act of 1992 (42 U.S.C. 1361l), or the restriction of 
occupancy to elderly families in accordance with section 658 of such 
Act, and to the extent the Secretary determines that such amount is not 
needed to fund applications for such affected families, to other 
nonelderly disabled families: Provided further, That the amount made 
available under the fifth proviso under the heading ``Prevention of 
Resident Displacement'' in title II of the Departments of Veterans 
Affairs and Housing and Urban Development, and Independent Agencies 
Appropriations Act, 1997, Public Law 104-204, shall also be made 
available to nonelderly disabled families affected by the restriction 
of occupancy to elderly families in accordance with section 658 of the 
Housing and Community Development Act of 1992: Provided further, That 
to the extent the Secretary determines that the amount made available 
under the fifth proviso under the heading ``Prevention of Resident 
Displacement'' in title II of the Departments of Veterans Affairs and 
Housing and Urban Development, and Independent Agencies Appropriations 
Act, 1997, Public Law 104-204, is not needed to fund applications for 
affected families described in the fifth proviso, or in the preceding 
proviso under this heading in this Act, the amount not needed shall be 
made available to other nonelderly disabled families: Provided further, 
That all balances, as of September 30, 1997, remaining in the ``Annual 
Contributions for Assisted Housing'' account and the ``Prevention of 
Resident Displacement'' account for use in connection with expiring or 
terminating section 8 subsidy contracts and for amendments to section 8 
contracts other than contracts for projects developed under section 202 
of the Housing Act of 1959, as amended, shall be transferred to and 
merged with the amounts provided for those purposes under this heading.


                 section 8 reserve preservation account


    The amounts recaptured during fiscal year 1998 that were 
heretofore made available to public housing agencies for 
tenant-based assistance under the section 8 existing housing 
certificate and housing voucher programs from the Annual 
Contributions for Assisted Housing account shall be collected 
in the account under this heading, for use as provided for 
under this heading, as set forth under the Annual Contributions 
for Assisted Housing heading in chapter 11 of Public Law 105-
18, approved June 12, 1997.


               annual contributions for assisted housing


              (including rescission and transfer of funds)


    Notwithstanding any other provision of law, of the amounts 
recaptured under this heading during fiscal year 1998 and prior 
years, $550,000,000, heretofore maintained as section 8 
reserves made available to housing agencies for tenant-based 
assistance under the section 8 existing housing certificate and 
housing voucher programs, are rescinded.
    All balances outstanding as of September 30, 1997, in the 
Preserving Existing Housing Investment Accountfor the 
Preservation program shall be transferred to and merged with the 
amounts previously provided for those purposes under this heading.


                      public housing capital fund


                     (including transfers of funds)


    For the Public Housing Capital Fund Program for 
modernization of existing public housing projects as authorized 
under section 14 of the United States Housing Act of 1937, as 
amended (42 U.S.C. 1437), $2,500,000,000, to remain available 
until exended: Provided, That of the total amount, $30,000,000 
shall be for carrying out activities under section 6(j) of such 
Act and technical assistance for the inspection of public 
housing units, contract expertise, and training and technical 
assistance directly or indirectly, under grants, contracts, or 
cooperative agreements, to assist in the oversight and 
management of public housing (whether or not the housing is 
being modernized with assistance under this proviso) or tenant-
based assistance, including, but not limited to, an annual 
resident survey, data collection and analysis, training and 
technical assistance by or to officials and employees of the 
Department and of public housing agencies and to residents in 
connection with the public housing program and for lease 
adjustments to section 23 projects: Provided further, That of 
the amount available under this heading, up to $5,000,000 shall 
be for the Tenant Opportunity Program: Provided further, That 
all balances, as of September 30, 1997, of funds heretofore 
provided (other than for Indian families) for the development 
or acquisition costs of public housing, for modernization of 
existing public housing projects, for public housing 
amendments, for public housing modernization and development 
technical assistance, for lease adjustments under the section 
23 program, and for the Family Investment Centers program, 
shall be transferred to and merged with amounts made available 
under this heading.


                     public housing operating fund


                     (including transfer of funds)


    For payments to public housing agencies for operating 
subsidies for low-income housing projects as authorized by 
section 9 of the United States Housing Act of 1937, as amended 
(42 U.S.C. 1437g), $2,900,000,000, to remain available until 
expended: Provided, That all balances outstanding, as of 
September 30, 1997, of funds heretofore provided (other than 
for Indian families) for payments to public housing agencies 
for operating subsidies for low-income housing projects, shall 
be transferred to and merged with amounts made available under 
this heading.


             drug elimination grants for low-income housing


                     (including transfer of funds)


    For grants to public housing agencies and tribally 
designated housing entities for use in eliminating crime in 
public housing projects authorized by 42 U.S.C. 11901-11908, 
for grants for federally assisted low-income housing authorized 
by 42 U.S.C. 11909, and for drug information clearinghouse 
services authorized by 42 U.S.C. 11921-11925, $310,000,000, to 
remain available until expended, of which $10,000,000 shall be 
for grants, technical assistance, contracts and other 
assistance, training, and program assessment and execution for 
or on behalf of public housing agencies, resident 
organizations, and Indian Tribes and their tribally designated 
housing entities (including the cost of necessary travel for 
participants in such training); $10,000,000 shall be used in 
connection with efforts to combat violent crime in public and 
assisted housing under the Operation Safe Home Program 
administered by the Inspector General of the Department of 
Housing and Urban Development; $10,000,000 shall be provided to 
the Office of Inspector General for Operation Safe Home; and 
$20,000,000 shall be available for a program named the New 
Approach Anti-Drug program which will provide competitive 
grants to entities managing or operating public housing 
developments, federally assisted multifamily housing 
developments, or other multifamily housing developments for 
low-income families supported by non-Federal governmental 
entities or similar housing developments supported by nonprofit 
private sources in order to provide or augment security 
(including personnel costs), to assist in the investigation 
and/or prosecution of drug related criminal activity in and 
around such developments, and to provide assistance for the 
development of capital improvements at such developments 
directly relating to the security of such developments: 
Provided, That grants for the New Approach Anti-Drug program 
shall be made on a competitive basis as specified in section 
102 of the Department of Housing and Urban Development Reform 
Act of 1989: Provided further, That the term ``drug-related 
crime'', as defined in 42 U.S.C. 11905(2), shall also include 
other types of crime as determined by the Secretary: Provided 
further, That, notwithstanding section 5130(c) of the Anti-Drug 
Abuse Act of 1988 (42 U.S.C. 11909(c)), the Secretary may 
determine not to use any such funds to provide public housing 
youth sports grants.


     revitalization of severely distressed public housing (hope vi)


    For grants to public housing agencies for assisting in the 
demolition of obsolete public housing projects or portions 
thereof, the revitalization (where appropriate) of sites 
(including remaining public housing units) on which such 
projects are located, replacement housing which willavoid or 
lessen concentrations of very low-income families, and tenant-based 
assistance in accordance with section 8 of the United States Housing 
Act of 1937; and for providing replacement housing and assisting 
tenants displaced by the demolition, $550,000,000, to remain available 
until expended, of which the Secretary may use up to $10,000,000 for 
technical assistance and contract expertise, to be provided directly or 
indirectly by grants, contracts or cooperative agreements, including 
training and cost of necessary travel for participants in such 
training, by or to officials and employees of the Department and of 
public housing agencies and to residents: Provided, That of the amount 
made available under this heading, $26,000,000 shall be made available, 
including up to $10,000,000 for Heritage House in Kansas City, 
Missouri, for the demolition of obsolete elderly public housing 
projects and the replacement, where appropriate, and revitalization of 
the elderly public housing as new communities for the elderly designed 
to meet the special needs and physical requirements of the elderly: 
Provided further, That no funds appropriated under this heading shall 
be used for any purpose that is not provided for herein, in the United 
States Housing Act of 1937, in the Appropriations Acts for the 
Departments of Veterans Affairs and Housing and Urban Development, and 
Independent Agencies, for the fiscal years 1993, 1994, 1995, and 1997, 
and the Omnibus Consolidated Rescissions and Appropriations Act of 
1996: Provided further, That none of such funds shall be used directly 
or indirectly by granting competitive advantage in awards to settle 
litigation or pay judgments, unless expressly permitted herein.


                  native american housing block grants


                     (including transfers of funds)


    For the Native American Housing Block Grants program, as 
authorized under title I of the Native American Housing 
Assistance and Self-Determination Act of 1996 (Public Law 104-
330), $600,000,000, to remain available until expended, of 
which $5,000,000 shall be used to support the inspection of 
Indian housing units, contract expertise, training, and 
technical assistance in the oversight and management of Indian 
housing and tenant-based assistance, including up to $200,000 
for related travel: Provided, That of the amount provided under 
this heading, $5,000,000 shall be made available for the cost 
of guaranteed notes and other obligations, as authorized by 
title VI of the Native American Housing Assistance and Self-
Determination Act of 1996: Provided further, That such costs, 
including the costs of modifying such notes and other 
obligations, shall be as defined in section 502 of the 
Congressional Budget Act of 1974, as amended: Provided further, 
That these funds are availableto subsidize the total principal 
amount of any notes and other obligations, any part of which is to be 
guaranteed, not to exceed $217,000,000: Provided further, That the 
funds made available in the first proviso are for a demonstration on 
ways to enhance economic growth, to increase access to private capital, 
and to encourage the investment and participation of traditional 
financial institutions in tribal and other Native American areas: 
Provided further, That all balances outstanding as of September 30, 
1997, previously appropriated under the headings ``Annual Contributions 
for Assisted Housing'', ``Development of Additional New Subsidized 
Housing'', ``Preserving Existing Housing Investment'', ``HOME 
Investment Partnerships Program'', ``Emergency Shelter Grants 
Program'', and ``Homeless Assistance Funds'', identified for Indian 
Housing Authorities and other agencies primarily serving Indians or 
Indian areas, shall be transferred to and merged with amounts made 
available under this heading.

           indian housing loan guarantee fund program account

    For the cost of guaranteed loans, as authorized by section 
184 of the Housing and Community Development Act of 1992 (106 
Stat. 3739), $5,000,000, to remain available until expended: 
Provided, That such costs, including the costs of modifying 
such loans, shall be as defined in section 502 of the 
Congressional Budget Act of 1974, as amended: Provided further, 
That these funds are available to subsidize total loan 
principal, any part of which is to be guaranteed, not to exceed 
$73,800,000.


           capital grants/capital loans preservation account


    At the discretion of the Secretary, to reimburse owners, 
nonprofits, and tenant groups for which plans of action were 
submitted with regard to eligible properties under the Low-
Income Housing Preservation and Resident Homeownership Act of 
1990 (LIHPRHA) or the Emergency Low Income Housing Preservation 
Act of 1987 (ELIHPA) prior to the effective date of this Act, 
but were not executed for lack of available funds, with such 
reimbursement available only for documented costs directly 
applicable to the preparation of the plan of action or any 
purchase agreement as determined by the Secretary, on terms and 
conditions to be established by the Secretary, $10,000,000 
shall be made available.

                   Community Planning and Development


              housing opportunities for persons with aids


    For carrying out the Housing Opportunities for Persons with 
AIDS program, as authorized by the AIDS Housing Opportunity Act 
(42 U.S.C. 12901), $204,000,000, to remain available until 
expended: Provided, That of the amount made available under 
this heading for non-formula allocation, the Secretary may 
designate, on a noncompetitive basis, one or more nonprofit 
organizations that provide meals delivered to homebound persons 
with acquired immunodeficiency syndrome or a related disease to 
receive grants, not exceeding $250,000 for any grant, and the 
Secretary shall assess the efficacy of providing such 
assistance to such persons.


                   community development block grants


                     (including transfers of funds)


    For grants to States and units of general local government 
and for related expenses, not otherwise provided for, to carry 
out a community development grants program as authorized by 
title I of the Housing and Community Development Act of 1974, 
as amended (the ``Act'' herein) (42 U.S.C. 5301), 
$4,675,000,000, to remain available until September 30, 2000: 
Provided, That $67,000,000 shall be for grants to Indian tribes 
notwithstanding section 106(a)(1) of such Act; $2,100,000 shall 
be available as a grant to the Housing Assistance Council; 
$1,500,000 shall be available as a grant to the National 
American Indian Housing Council; $32,000,000 shall be for 
grants pursuant to section 107 of such Act; $7,500,000 shall be 
for the Community Outreach Partnership program; $16,700,000 
shall be for grants pursuant to section 11 of the Housing 
Opportunity Program Extension Act of 1996 (Public Law 104-120): 
Provided further, That not to exceed 20 percent of any grant 
made with funds appropriated herein (other than a grant made 
available under the preceding proviso to the Housing Assistance 
Council or the National American Indian Housing Council, or a 
grant using funds under section 107(b)(3) of the Housing and 
Community Development Act of 1974, as amended) shall be 
expended for ``Planning and Management Development'' and 
``Administration'' as defined in regulations promulgated by the 
Department.
    Of the amount made available under this heading, 
$15,000,000 shall be made available for ``Capacity Building for 
Community Development and Affordable Housing,'' as authorized 
by section 4 of the HUD Demonstration Act of 1993 (Public Law 
103-120), as in effect immediately before June 12, 1997, with 
not less than $5,000,000 of the funding to be used in rural 
areas, including tribal areas.
    Of the amount provided under this heading, the Secretary of 
Housing and Urban Development may use up to $55,000,000 for a 
public and assisted housing self-sufficiency program, of which 
up to $5,000,000 may be used for the Moving to Work 
Demonstration, and at least $7,000,000 shall be used for grants 
for service coordinators and congregate services for the 
elderly and disabled: Provided, That for self-sufficiency 
activities, the Secretary may make grants to public 
housingagencies (including Indian tribes and their tribally designated 
housing entities), nonprofit corporations, and other appropriate 
entities for a supportive services program to assist residents of 
public and assisted housing, former residents of such housing receiving 
tenant-based assistance under section 8 of such Act (42 U.S.C. 1437f), 
and other low-income families and individuals: Provided further, That 
the program shall provide supportive services, principally for the 
benefit of public housing residents, to the elderly and the disabled, 
and to families with children where the head of household would benefit 
from the receipt of supportive services and is working, seeking work, 
or is preparing for work by participating in job training or 
educational programs: Provided further, That the supportive services 
may include congregate services for the elderly and disabled, service 
coordinators, and coordinated education, training, and other supportive 
services, including academic skills training, job search assistance, 
assistance related to retaining employment, vocational and 
entrepreneurship development and support programs, transportation, and 
child care: Provided further, That the Secretary shall require 
applications to demonstrate firm commitments of funding or services 
from other sources: Provided further, That the Secretary shall select 
public and Indian housing agencies to receive assistance under this 
heading on a competitive basis, taking into account the quality of the 
proposed program, including any innovative approaches, the extent of 
the proposed coordination of supportive services, the extent of 
commitments of funding or services from other sources, the extent to 
which the proposed program includes reasonably achievable, quantifiable 
goals for measuring performance under the program over a three-year 
period, the extent of success an agency has had in carrying out other 
comparable initiatives, and other appropriate criteria established by 
the Secretary (except that this proviso shall not apply to renewal of 
grants for service coordinators and congregate services for the elderly 
and disabled).
    Of the amount made available under this heading, 
notwithstanding any other provision of law, $35,000,000 shall 
be available for YouthBuild program activities authorized by 
subtitle D of title IV of the Cranston-Gonzalez National 
Affordable Housing Act, as amended, and such activities shall 
be an eligible activity with respect to any funds made 
available under this heading. Local YouthBuild programs that 
demonstrate an ability to leverage private and nonprofit 
funding shall be given a priority for YouthBuild funding.
    Of the amount made available under this heading $25,000,000 
shall be available for the Secretary, in consultation with the 
Secretary of Agriculture, to make grants, not to exceed 
$4,000,000 each, for rural and tribal areas, including at least 
one Native American area in Alaska and one rural area in each 
of the States of Iowa and Missouri, to test comprehensive 
approaches to developing a job base through economic 
development, developing affordable low- and moderate-income 
rental and homeownership housing, and increasing the investment 
of both private and nonprofit capital.
    Of the amount made available under this heading, 
$138,000,000 shall be available for the Economic Development 
Initiative (EDI) to finance a variety of efforts, including 
$100,000,000 for making grants for targeted economic 
investments in accordance with the terms and conditions 
specified for such grants in the conference report and the 
joint explanatory statement of the committee of conference 
accompanying this Act (H.R. 2158).
    Of the amount made available under this heading, 
notwithstanding any other provision of law, $60,000,000 shall 
be available for the lead-based paint hazard reduction program 
as authorized under sections 1011 and 1053 of the Residential 
Lead-Based Hazard Reduction Act of 1992.
    Of the amount made available under this heading, 
$25,000,000, including $15,000,000 for the County of San 
Bernardino, California, shall be used for neighborhood 
initiatives that are utilized to improve the conditions of 
distressed and blighted areas and neighborhoods, and to 
determine whether housing benefits can be integrated more 
effectively with welfare reform initiatives.
    For the cost of guaranteed loans, $29,000,000, as 
authorized by section 108 of the Housing and Community 
Development Act of 1974: Provided, That such costs, including 
the cost of modifying such loans, shall be as defined in 
section 502 of the Congressional Budget Act of 1974, as 
amended: Provided further, That these funds are available to 
subsidize total loan principal, any part of which is to be 
guaranteed, not to exceed $1,261,000,000, notwithstanding any 
aggregate limitation on outstanding obligations guaranteed in 
section 108(k) of the Housing and Community Development Act of 
1974. In addition, for administrative expenses to carry out the 
guaranteed loan program, $1,000,000, which shall be transferred 
to and merged with the appropriation for departmental salaries 
and expenses.
    Of the $500,000,000 made available under the heading 
``Community Development Block Grants Fund'' in the 1997 
Emergency Supplemental Appropriations Act for Recovery from 
Natural Disasters, and for Overseas Peacekeeping Efforts, 
Including Those in Bosnia (Public Law 105-18), not more than 
$3,500,000 shall be made available for the non-Federal cost-
share for a levee project at Devils Lake, North Dakota: 
Provided, That the Secretary of Housing and Urban Development 
shall provide the State of North Dakota with a waiver to allow 
the use of its annual Community Development Block Grant 
allocation for use in funding the non-Federal cost-share for a 
levee project at Devils Lake, North Dakota: Provided further, 
That notwithstanding any other provision of law, the Secretary 
is prohibited from providing waivers, other than those provided 
herein, for funds in excess of $100,000 in emergency Community 
Development Block Grants funds for the non-Federal cost-share 
of projects funded by the Secretary of the Army through the 
Corps of Engineers.

                       brownfields redevelopment

    For Economic Development Grants, as authorized by section 
108(q) of the Housing and Community Development Act of 1974, as 
amended, for Brownfields redevelopment projects, $25,000,000, 
to remain available until expended: Provided, That the 
Secretary of Housing and Urban Development shall make these 
grants available on a competitive basis as specified in section 
102 of the Department of Housing and Urban Development Reform 
Act of 1989.


              empowerment zones and enterprise communities


    For planning grants, technical assistance, contracts and 
other assistance, and training in connection with Empowerment 
Zones and Enterprise Communities, designated by the Secretary 
of Housing and Urban Development, to continue efforts to 
stimulate economic opportunity in America's distressed 
communities, $5,000,000, to remain available until expended.


                  home investment partnerships program


    For the HOME investment partnerships program, as authorized 
under title II of the Cranston-Gonzalez National Affordable 
Housing Act (Public Law 101-625), as amended, $1,500,000,000, 
to remain available until expended: Provided, That up to 
$7,000,000 shall be available for the development and operation 
of integrated community development management information 
systems: Provided further, That $20,000,000 shall be available 
for Housing Counseling under section 106 of the Housing and 
Urban Development Act of 1968: Provided further, That up to 
$10,000,000 shall be available to carry out a demonstration 
program in which the Secretary makes grants to up to three 
organizations exempt from Federal taxation under section 
501(c)(3) of the Internal Revenue Code, selected on a 
competitive basis, to demonstrate methods of expanding 
homeownership opportunities for low-income borrowers through 
expanding the secondary market for non-conforming home mortgage 
loans to low-wealth borrowers: Provided further, That grantees 
for such demonstration program shall have experience in working 
with lenders who make non-conforming loans to low-income 
borrowers, have experience in expanding the secondary market 
for such loans, have demonstrated success in carrying out such 
activities including raising non-Federal grants and capital on 
concessionary terms for the purpose of expanding the secondary 
market for loans in the previous two years in amounts equal to 
or exceeding the amount awarded to such organization under this 
paragraph, and have demonstrated the ability to provide data on 
the performance of such loans sufficientto allow for future 
analysis of the investment risk of such loans.


                       supportive housing program


                              (rescission)


    Of the funds made available under this heading in Public 
Law 102-389 and prior laws for the Supportive Housing 
Demonstration Program, as authorized by the Stewart B. McKinney 
Homeless Assistance Act, $6,000,000 of funds recaptured during 
fiscal year 1998 shall be rescinded.


                           shelter plus care


                              (rescission)


    Of the funds made available under this heading in Public 
Law 102-389 and prior laws for the Shelter Plus Care program, 
as authorized by the Stewart B. McKinney Homeless Assistance 
Act, $4,000,000 of funds recaptured during fiscal year 1998 
shall be rescinded.


                       homeless assistance grants


    For the emergency shelter grants program (as authorized 
under subtitle B of title IV of the Stewart B. McKinney 
Homeless Assistance Act, as amended); the supportive housing 
program (as authorized under subtitle C of title IV of such 
Act); the section 8 moderate rehabilitation single room 
occupancy program (as authorized under the United States 
Housing Act of 1937, as amended) to assist homeless individuals 
pursuant to section 441 of the Stewart B. McKinney Homeless 
Assistance Act; and the shelter plus care program (as 
authorized under subtitle F of title IV of such Act), 
$823,000,000, to remain available until expended.

                            Housing Programs


                    housing for special populations


                     (including transfers of funds)


    For assistance for the purchase, construction, acquisition, 
or development of additional public and subsidized housing 
units for low income families under the United States Housing 
Act of 1937, as amended (42 U.S.C. 1437), not otherwise 
provided for, $839,000,000, to remain available until expended: 
Provided, That of the total amount provided under this heading, 
$645,000,000 shall be for capital advances, including 
amendments to capital advance contracts, for housing for the 
elderly, as authorized by section 202 of the Housing Act of 
1959, as amended, and for project rental assistance, and 
amendments to contracts for project rental assistance, for the 
elderly under section 202(c)(2) of the Housing Act of 1959, and 
for supportive services associated with the housing; and 
$194,000,000 shall be for capital advances, including 
amendments to capital advance contracts, for supportive housing 
for persons with disabilities, as authorized by section 811 of 
the Cranston-Gonzalez National Affordable Housing Act, for 
project rental assistance, for amendments to contracts for 
project rental assistance, and supportive services associated 
with the housing for persons with disabilities as authorized by 
section 811 of such Act: Provided further, That the Secretary 
may designate up to 25 percent of the amounts earmarked under 
this paragraph for section 811 of such Act for tenant-based 
assistance, as authorized under that section, including such 
authority as may be waived under the next proviso, which 
assistance is five years in duration: Provided further, That 
the Secretary may waive any provision of section 202 of the 
Housing Act of 1959 and section 811 of the Cranston-Gonzalez 
National Affordable Housing Act (including the provisions 
governing the terms and conditions of project rental assistance 
and tenant-based assistance) that the Secretary determines is 
not necessary to achieve the objectives of these programs, or 
that otherwise impedes the ability to develop, operate or 
administer projects assisted under these programs, and may make 
provision for alternative conditions or terms where 
appropriate: Provided further, That all balances, as of 
September 30, 1997, remaining in either the ``Annual 
Contributions for Assisted Housing'' account or the 
``Development of Additional New Subsidized Housing'' account 
for capital advances, including amendments to capital advances, 
for housing for the elderly, as authorized by section 202 of 
the Housing Actof 1959, as amended, and for project rental 
assistance, and amendments to contracts for project rental assistance, 
for supportive housing for the elderly, under section 202(c)(2) of such 
Act, shall be transferred to and merged with the amounts for those 
purposes under this heading; and, all balances, as of September 30, 
1997, remaining in either the ``Annual Contributions for Assisted 
Housing'' account or the ``Development of Additional New Subsidized 
Housing'' account for capital advances, including amendments to capital 
advances, for supportive housing for persons with disabilities, as 
authorized by section 811 of the Cranston-Gonzalez National Affordable 
Housing Act, and for project rental assistance, and amendments to 
contracts for project rental assistance, for supportive housing for 
persons with disabilities, as authorized under section 811 of such Act, 
shall be transferred to and merged with the amounts for those purposes 
under this heading.


                    other assisted housing programs


                       rental housing assistance


                              (rescission)


    The limitation otherwise applicable to the maximum payments 
that may be required in any fiscal year by all contracts 
entered into under section 236 of the National Housing Act (12 
U.S.C. 1715z-1) is reduced in fiscal year 1998 by not more than 
$7,350,000 in uncommitted balances of authorizations provided 
for this purpose in appropriation Acts: Provided, That up to 
$125,000,000 of recaptured budget authority shall be canceled.


                         flexible subsidy fund


                          (transfer of funds)


    From the Rental Housing Assistance Fund, all uncommitted 
balances of excess rental charges as of September 30, 1997, and 
any collections made during fiscal year 1998, shall be 
transferred to the Flexible Subsidy Fund, as authorized by 
section 236(g) of the National Housing Act, as amended.

                     Federal Housing Administration


             fha--mutual mortgage insurance program account


                     (including transfers of funds)


    During fiscal year 1998, commitments to guarantee loans to 
carry out the purposes of section 203(b) of the National 
Housing Act, as amended, shall not exceed a loan principal of 
$110,000,000,000.
    During fiscal year 1998, obligations to make direct loans 
to carry out the purposes of section 204(g) of the National 
Housing Act, as amended, shall not exceed $200,000,000: 
Provided, That the foregoing amount shall be for loans to 
nonprofit and governmental entities in connection with sales of 
single family real properties owned by the Secretary and 
formerly insured under the Mutual Mortgage Insurance Fund.
    For administrative expenses necessary to carry out the 
guaranteed and direct loan program, $338,421,000, to be derived 
from the FHA-mutual mortgage insurance guaranteed loans receipt 
account, of which not to exceed $326,309,000 shall be 
transferred to the appropriation for departmental salaries and 
expenses; and of which not to exceed $12,112,000 shall be 
transferred to the appropriation for the Office of Inspector 
General.


             fha--general and special risk program account


                     (including transfers of funds)


    For the cost of guaranteed loans, as authorized by sections 
238 and 519 of the National Housing Act (12 U.S.C. 1715z-3 and 
1735c), including the cost of loan guarantee modifications (as 
that term is defined in section 502 of the Congressional Budget 
Act of 1974, as amended), $81,000,000, to remain available 
until expended: Provided, That these funds are available to 
subsidize total loan principal, any part of which is to be 
guaranteed, of up to $17,400,000,000: Provided further, That 
any amounts made available in any prior appropriations Act for 
the cost (as such term is defined in section 502 of the 
Congressional Budget Act of 1974) of guaranteed loans that are 
obligations of the funds established under section 238 or 519 
of the National Housing Act that havenot been obligated or that 
are deobligated shall be available to the Secretary of Housing and 
Urban Development in connection with the making of such guarantees and 
shall remain available until expended, notwithstanding the expiration 
of any period of availability otherwise applicable to such amounts.
    Gross obligations for the principal amount of direct loans, 
as authorized by sections 204(g), 207(l), 238(a), and 519(a) of 
the National Housing Act, shall not exceed $120,000,000; of 
which not to exceed $100,000,000 shall be for bridge financing 
in connection with the sale of multifamily real properties 
owned by the Secretary and formerly insured under such Act; and 
of which not to exceed $20,000,000 shall be for loans to 
nonprofit and governmental entities in connection with the sale 
of single-family real properties owned by the Secretary and 
formerly insured under such Act.
    In addition, for administrative expenses necessary to carry 
out the guaranteed and direct loan programs, $222,305,000, of 
which $218,134,000, including $25,000,000 for the enforcement 
of housing standards on FHA-insured multifamily projects, shall 
be transferred to the appropriation for departmental salaries 
and expenses; and of which $4,171,000 shall be transferred to 
the appropriation for the Office of Inspector General.

                Government National Mortgage Association


guarantees of mortgage-backed securities loan guarantee program account


                     (including transfer of funds)


    During fiscal year 1998, new commitments to issue 
guarantees to carry out the purposes of section 306 of the 
National Housing Act, as amended (12 U.S.C. 1721(g)), shall not 
exceed $130,000,000,000.
    For administrative expenses necessary to carry out the 
guaranteed mortgage-backed securities program, $9,383,000, to 
be derived from the GNMA-guarantees of mortgage-backed 
securities guaranteed loan receipt account, of which not to 
exceed $9,383,000 shall be transferred to the appropriation for 
departmental salaries and expenses.

                    Policy Development and Research


                        research and technology


    For contracts, grants, and necessary expenses of programs 
of research and studies relating to housing and urban problems, 
not otherwise provided for, as authorized by title V of the 
Housing and Urban Development Act of 1970, as amended (12 
U.S.C. 1701z-1 et seq.), including carrying out the functions 
of the Secretary under section 1(a)(1)(i) of Reorganization 
Plan No. 2 of 1968, $36,500,000, to remain available until 
September 30, 1999.
    Of the amount made available under this heading, $500,000 
shall be made available for a contract with the National 
Academy of Public Administration to evaluate the Secretary's 
efforts to implement needed management systems and processes.

                   Fair Housing and Equal Opportunity


                        fair housing activities


    For contracts, grants, and other assistance, not otherwise 
provided for, as authorized by title VIII of the Civil Rights 
Act of 1968, as amended by the Fair Housing Amendments Act of 
1988, and section 561 of the Housing and Community Development 
Act of 1987, as amended, $30,000,000, to remain available until 
September 30, 1999, of which $15,000,000 shall be to carry out 
activities pursuant to such section 561. No funds made 
available under this heading shall be used to lobby the 
executive or legislative branches of the Federal government in 
connection with a specific contract, grant or loan.

                     Management and Administration


                         salaries and expenses


                     (including transfer of funds)


    For necessary administrative and non-administrative 
expenses of the Department of Housing and Urban Development, 
not otherwise provided for, including not to exceed $7,000 for 
official reception and representation expenses, $1,000,826,000, 
of which $544,443,000 shall be provided from the various funds 
of the Federal Housing Administration, $9,383,000 shall be 
provided from funds of the Government National Mortgage 
Association, and $1,000,000 shall be provided from the 
``Community Development Grants Program'' account.

                      office of inspector general


                     (including transfer of funds)


    For necessary expenses of the Office of Inspector General 
in carrying out the Inspector General Act of 1978, as amended, 
$66,850,000, of which $16,283,000 shall be provided from the 
various funds of the Federal Housing Administration and 
$10,000,000 shall be transferred from the amount earmarked for 
Operation Safe Home in the ``Drug Elimination Grants for Low 
Income Housing'' account.

             Office of Federal Housing Enterprise Oversight


                         salaries and expenses


                     (including transfer of funds)


    For carrying out the Federal Housing Enterprise Financial 
Safety and Soundness Act of 1992, $16,000,000, to remain 
available until expended, to be derived from the Federal 
Housing Enterprise Oversight Fund: Provided, That not to exceed 
such amount shall be available from the General Fund of the 
Treasury to the extent necessary to incur obligations and make 
expenditures pending the receipt of collections to the Fund: 
Provided further, That the General Fund amount shall be reduced 
as collections are received during the fiscal year so as to 
result in a final appropriation from the General Fund estimated 
at not more than $0.


                       administrative provisions


    Sec. 201. Extenders. (a) One-for-One Replacement of Public 
Housing.--Section 1002(d) of Public Law 104-19 is amended by 
striking ``1997'' and inserting ``1998''.
    (b) Streamlining Section 8 Tenant-Based Assistance.--
Section 203(d) of the Departments of Veterans Affairs and 
Housing and Urban Development, and Independent Agencies 
Appropriations Act, 1996, is amended by striking ``fiscal years 
1996 and 1997'' and inserting ``fiscal years 1996, 1997, and 
1998''.
    (c) Section 8 Rent Adjustments.--Section 8(c)(2)(A) of the 
United States Housing Act of 1937 is amended--
            (1) in the third sentence, by striking ``fiscal 
        year 1997'' and inserting ``fiscal years 1997 and 
        1998''; and
            (2) in the last sentence, by striking ``fiscal year 
        1997'' and inserting ``fiscal years 1997 and 1998''.
    (d) Public and Assisted Housing Rents, Income Adjustments 
and Preferences.--
            (1) Section 402(a) of The Balanced Budget 
        Downpayment Act, I is amended by striking ``fiscal year 
        1997'' and inserting in lieu thereof ``fiscal years 
        1997 and 1998''.
            (2) Section 402(f) of The Balanced Budget 
        Downpayment Act, I is amended by striking ``fiscal 
        years 1996 and 1997'' and inserting in lieu thereof 
        ``fiscal years 1996, 1997, and 1998''.
    Sec. 202. Delay Reissuance of Vouchers and Certificates.--
Section 403(c) of The Balanced Budget Downpayment Act, I is 
amended--
            (1) by striking ``fiscal years 1996 and 1997'' and 
        inserting ``fiscal years 1996, 1997, and 1998'';
            (2) by striking ``1996 and October'' and inserting 
        ``1996, October''; and
            (3) by inserting before the semicolon the 
        following: ``and October 1, 1998 for assistance made 
        available during fiscal year 1998''.
    Sec. 203. Waiver.--The part of the HUD 1996 Community 
Development Block Grant to the State of Illinois which is 
administered by the State of Illinois Department of Commerce 
and Community Affairs (grant number B-96-DC-170001) and which, 
in turn, was granted by the Illinois Department of Commerce and 
Community Affairs to the city of Oglesby, Illinois, located in 
LaSalle County, Illinois (State of Illinois Department of 
Commerce and Community Affairs grant number 96-24104), for the 
purpose of providing infrastructure for a warehouse in Oglesby, 
Illinois, is exempt from the provisions of section 104(g)(2), 
(g)(3), and (g)(4) of title I of the Housing and Community 
Development Act of 1974 as amended.
    Sec. 204. Financing Adjustment Factors.--Fifty percent of 
the amounts of budget authority, or in lieu thereof 50 percent 
of the cash amounts associated with such budget authority, that 
are recaptured from projects described in section 1012(a) of 
the Stewart B. McKinney Homeless Assistance Amendments Act of 
1988 (Public Law 100-628, 102 Stat. 3224, 3268) shall be 
rescinded, or in the case of cash, shall be remitted to the 
Treasury, and such amounts of budget authority or cash 
recaptured and not rescinded or remitted to the Treasury shall 
be used by State housing finance agencies or local governments 
or local housing agencies with projects approved by the 
Secretary of Housing and Urban Development for which settlement 
occurred after January 1, 1992, in accordance with such 
section. Notwithstanding the previous sentence, the Secretary 
may award up to 15 percent of the budget authority or cash 
recaptured and not rescinded or remitted to the Treasury to 
provide project owners with incentives to refinance their 
project at a lower interest rate.
    Sec. 205. Annual Adjustment Factors.--Section 8(c)(2)(A) of 
the United States Housing Act of 1937, as amended by section 
201 of this title, is further amended by inserting the 
following new sentences at the end: ``In establishing annual 
adjustment factors for units in new construction and 
substantial rehabilitation projects, the Secretary shall take 
into account the fact that debt service is a fixed expense. The 
immediately foregoing sentence shall be effective only during 
fiscal year 1998.''.
    Sec. 206. Community Development Block Grant.--
Notwithstanding any other provision of law, the $7,100,000 
appropriated for an industrial park at 18th Street and Indiana 
Avenue shall be made available by the Secretary instead to 18th 
and Vine for rehabilitation and infrastructure development 
associated with the ``Negro Leagues Baseball Museum'' and the 
jazz museum.
    Sec. 207. Fair Housing and Free Speech.--None of the 
amounts made available under this Act may be used during fiscal 
year 1998 to investigate or prosecute under the Fair Housing 
Act any otherwise lawful activity engaged in by one or more 
persons, including the filing or maintaining of a nonfrivolous 
legal action, that is engaged in solely for the purpose of 
achieving or preventing action by a government official or 
entity, or a court of competent jurisdiction.
    Sec. 208. Requirement for HUD to Maintain Public Notice and 
Comment Rulemaking.--Notwithstanding any other provision of 
law, for fiscal year 1998 and for all fiscal years thereafter, 
the Secretary of Housing and Urban Development shall maintain 
all current requirements under part 10 of the Department of 
Housing and Urban Development regulations (24 CFR part 10) with 
respect to the Department's policies and procedures for the 
promulgation and issuance of rules, including the use of public 
participation in the rulemaking process.
    Sec. 209. Brownfields as Eligible CDBG Activity.--During 
fiscal year 1998, States and entitlement communities may use 
funds allocated under the community development block grants 
program under title I of the Housing and Community Development 
Act of 1974 for environmental cleanup and economic development 
activities related to Brownfields projects in conjunction with 
the appropriate environmental regulatory agencies, as if such 
activities were eligible under section 105(a) of such Act.
    Sec. 210. Partial Payment of Claims on Health Care 
Facilities.--Section 541(a) of the National Housing Act is 
amended--
            (1) in the section heading, by adding ``and health 
        care facilities'' at the end; and
            (2) in subsection (a)--
                    (A) by inserting ``or a health care 
                facility (including a nursing home, 
                intermediate care facility, or board and care 
                home (as those terms are defined in section 232 
                of this Act), a hospital (as that term is 
                defined in section 242 of this Act), or a group 
                practice facility (as that term is defined in 
                section 1106 of this Act))'' after ``1978''; 
                and
                    (B) by inserting ``or for keeping the 
                health care facility operational to serve 
                community needs,'' after ``character of the 
                project,''.
    Sec. 211. Calculation of Downpayment.--Section 203(b) of 
the National Housing Act is amended by striking ``fiscal year 
1997'' in paragraph (10)(A) and inserting in lieu thereof 
``fiscal years 1997 and 1998''.
    Sec. 212. HOPE VI NOFA.--Notwithstanding any other 
provision of law, including the July 22, 1996 Notice of Funding 
Availability (61 Fed. Reg. 38024), the demolition of units at 
developments funded under the Notice of Funding Availability 
shall be at the option of the New York City Housing Authority 
and the assistance awarded shall be allocated by the public 
housing agency among other eligible activities under the HOPE 
VI program and without the development costs limitations of the 
Notice, provided that the public housing agency shall not 
exceed the total cost limitations for the public housing 
agency, as provided by the Department of Housing and Urban 
Development.
    Sec. 213. Enhanced Disposition Authority.--Section 204 of 
the Departments of Veterans Affairs and Housing and Urban 
Development, and Independent Agencies Appropriations Act, 1997, 
is amended by inserting after ``owned by the Secretary'' the 
following: ``, including, for fiscal years 1997 and 1998, the 
provision of grants and loans from the General Insurance Fund 
(12 U.S.C. 1735c) for the necessary costs of rehabilitation or 
demolition,''.
    Sec. 214. Home Program Formula.--The first sentence of 
section 217(b)(3) of the Cranston-Gonzalez National Affordable 
Housing Act is amended by striking ``only those jurisdictions 
that are allocated an amount of $500,000 or greater shall 
receive an allocation'' and inserting in lieu thereof the 
following: ``jurisdictions that are allocated an amount of 
$500,000or more, and participating jurisdictions (other than 
consortia that fail to renew the membership of all of their member 
jurisdictions) that are allocated an amount less than $500,000, shall 
receive an allocation''.
    Sec. 215. HUD Rent Reform.--Notwithstanding any other 
provision of law, the Secretary of Housing and Urban 
Development may provide tenant-based assistance to eligible 
tenants of a project insured under either sections 221(d)(3) or 
236 of the National Housing Act in the same manner as if the 
owner had prepaid the insured mortgage to the extent necessary 
to minimize any rent increases or to prevent displacement of 
low-income tenants in accordance with a transaction approved by 
the Secretary provided that the rents are no higher than the 
published section 8 fair market rents, as of the date of 
enactment, during the tenants' occupancy of the property.
    Sec. 216. Nursing Home Lease Terms.--Section 232(b)(4)(B) 
of the National Housing Act is amended by striking ``fifty 
years from the date the mortgage was executed'' and inserting 
``ten years to run beyond the maturity date of the mortgage''.
    Sec. 217. Housing Opportunities for Persons With AIDS 
Grants.--(a) Eligibility.--Notwithstanding section 854(c)(1)(A) 
of the AIDS Housing Opportunity Act (42 U.S.C. 12903(c)(1)(A)), 
from any amounts made available under this title for fiscal 
year 1998 that are allocated under such section, the Secretary 
of Housing and Urban Development shall allocate and make a 
grant, in the amount determined under subsection (b), for any 
State that--
            (1) received an allocation for fiscal year 1997 
        under clause (ii) of such section;
            (2) is not otherwise eligible for an allocation for 
        fiscal year 1998 under such clause (ii) because the 
        State does not have the number of cases of acquired 
        immunodeficiency syndrome required under such clause; 
        and
            (3) would meet such requirement if the cases in the 
        metropolitan statistical area for any city within the 
        State, which city was not eligible for an allocation 
        for fiscal year 1997 under clause (i) of such section 
        but is eligible for an allocation for fiscal year 1998 
        under such clause, were considered to be cases outside 
        of metropolitan statistical areas described in clause 
        (i) of such section.
    (b) Amount.--The amount of the allocation and grant for any 
State described in subsection (a) shall be the amount that is 
equal to the lesser of--
            (1) the difference between--
                    (A) the total amount allocated for such 
                State under section 854(c)(1)(A)(ii) of the 
                AIDS Housing Opportunity Act for fiscal year 
                1997; and
                    (B) the total amount allocated for the city 
                described in subsection (a)(3) of this section 
                under section 854(c)(1)(A)(i) of such Act for 
                fiscal year 1998 (from amounts made available 
                under this title); and
            (2) $300,000.
    Sec. 218. Debt Forgiveness.--The Secretary of Housing and 
Urban Development shall cancel the indebtedness of the Village 
of Robbins, Illinois, relating to loans under the 
Reconstruction Finance Corporation and refinanced under the 
Public Facility Loan program (loan numbers ILL-11-RFC-0029 and 
ILL-11-PFL0111). The Village is hereby relieved of all 
liability to the Federal government for the outstanding 
principal balance on such loans, for the amount of accrued 
interest on such loans, and for any fees and charges payable in 
connection with such loans.

                    TITLE III--INDEPENDENT AGENCIES

                  American Battle Monuments Commission


                         salaries and expenses


    For necessary expenses, not otherwise provided for, of the 
American Battle Monuments Commission, including the acquisition 
of land or interest in land in foreign countries; purchases and 
repair of uniforms for caretakers of national cemeteries and 
monuments outside of the United States and its territories and 
possessions; rent of office and garage space in foreign 
countries; purchase (one for replacement only) and hire of 
passenger motor vehicles; and insurance of official motor 
vehicles in foreign countries, when required by law of such 
countries; $26,897,000, to remain available until expended: 
Provided, That where station allowance has been authorized by 
the Department of the Army for officers of the Army serving the 
Army at certain foreign stations, the same allowance shall be 
authorized for officers of the Armed Forces assigned to the 
Commission while serving at the same foreign stations, and this 
appropriation is hereby made available for the payment of such 
allowance: Provided further, That when traveling on business of 
the Commission, officers of the Armed Forces serving as members 
or as Secretary of the Commission may be reimbursed for 
expenses as provided for civilian members of the Commission: 
Provided further, That the Commission shall reimburse other 
Government agencies, including the Armed Forces, for salary, 
pay, and allowances of personnel assigned to it.

             Chemical Safety and Hazard Investigation Board


                         salaries and expenses


    For necessary expenses in carrying out activities pursuant 
to section 112(r)(6) of the Clean Air Act, including hire of 
passenger vehicles, and for services authorized by 5 U.S.C. 
3109, but at rates for individuals not to exceed the per diem 
equivalent to the maximum rate payable for senior level 
positions under 5 U.S.C. 5376, $4,000,000.

                       Department of the Treasury

              Community Development Financial Institutions


   community development financial institutions fund program account


    For grants, loans, and technical assistance to qualifying 
community development lenders, and administrative expenses of 
the Fund, including services authorized by 5 U.S.C. 3109, but 
at rates for individuals not to exceed the per diem rate 
equivalent to the rate for ES-3, $80,000,000, to remain 
available until September 30, 1999, of which $12,000,000 may be 
used for the cost of direct loans, and up to $1,000,000 may be 
used for administrative expenses to carry out the direct loan 
program: Provided, That the cost of direct loans, including the 
cost of modifying such loans, shall be as defined in section 
502 of the Congressional Budget Act of 1974: Provided further, 
That these funds are available to subsidize gross obligations 
for the principal amount of direct loans not to exceed 
$32,000,000: Provided further, That not more than $25,000,000 
of the funds made available under this heading may be used for 
programs and activities authorized in section 114 of the 
Community Development Banking and Financial Institutions Act of 
1994.

                   Consumer Product Safety Commission


                         salaries and expenses


    For necessary expenses of the Consumer Product Safety 
Commission, including hire of passenger motor vehicles, 
services as authorized by 5 U.S.C. 3109, but at rates for 
individuals not to exceed the per diem rate equivalent to the 
maximum rate payable under 5 U.S.C. 5376, purchase of nominal 
awards to recognize non-Federal officials' contributions to 
Commission activities, and not to exceed $500 for official 
reception and representation expenses, $45,000,000.

             Corporation for National and Community Service


                national and community service programs


                           operating expenses


                     (including transfer of funds)


    For necessary expenses for the Corporation for National and 
Community Service (referred to in the matter under this heading 
as the ``Corporation'') in carrying out programs, activities, 
and initiatives under the National and Community Service Act of 
1990 (referred to in the matter under this heading as the 
``Act'') (42 U.S.C. 12501 et seq.), $425,500,000, to remain 
available until September 30, 1999: Provided, That not more 
than $27,000,000 shall be available for administrative expenses 
authorized under section 501(a)(4) of the Act (42 U.S.C. 
12671(a)(4)): Provided further, That not more than $2,500 shall 
be for official reception and representation expenses: Provided 
further, That not more than $70,000,000, to remain available 
without fiscal year limitation, shall be transferred to the 
National Service Trust account for educational awards 
authorized under subtitle D of title I of the Act (42 U.S.C. 
12601 et seq.), of which not to exceed $5,000,000 shall be 
available for national service scholarships for high school 
students performing community service: Provided further, That 
not more than $227,000,000 of the amount provided under this 
heading shall be available for grants under the National 
Service Trust program authorized under subtitle C of title I of 
the Act (42 U.S.C. 12571 et seq.) (relating to activities 
including the Americorps program), of which not more than 
$40,000,000 may be used to administer, reimburse, or support 
any national service program authorized under section 121(d)(2) 
of such Act (42 U.S.C. 12581(d)(2)): Provided further, That not 
more than $5,500,000 of the funds made available under this 
heading shall be made available for the Points of Light 
Foundation for activities authorized under title III of the Act 
(42 U.S.C. 12661 et seq.): Provided further, That no funds 
shall be available for national service programs run by Federal 
agencies authorized under section 121(b) of such Act (42 U.S.C. 
12571(b)): Provided further, That to the maximum extent 
feasible, funds appropriated under subtitle C of title I of the 
Act shall be provided in a manner that is consistent with the 
recommendations of peer review panels in order to ensure that 
priority is given to programs that demonstrate quality, 
innovation, replicability, and sustainability: Provided 
further, That not more than $18,000,000 of the funds made 
available under this heading shall be available for the 
Civilian Community Corps authorized under subtitle E of title I 
of the Act (42 U.S.C. 12611 et seq.): Provided further, That 
not more than $43,000,000 shall be available for school-based 
and community-based service-learning programs authorized under 
subtitle B of title I of the Act (42 U.S.C. 12521 et seq.): 
Provided further, That not more than $30,000,000 shall be 
available for quality and innovation activities authorized 
under subtitle H of title I of the Act (42 U.S.C. 12853 et 
seq.): Provided further, That not more than $5,000,000 shall be 
available for audits and other evaluations authorized under 
section 179 of the Act (42 U.S.C. 12639): Provided further, 
That to the maximum extent practicable, the Corporation shall 
increase significantly the level of matching funds and in-kind 
contributions provided by the private sector, shall expand 
significantly the number of educational awards provided under 
subtitle D of title I, and shall reduce the total Federal costs 
per participant in all programs.


                      office of inspector general


    For necessary expenses of the Office of Inspector General 
in carrying out the Inspector General Act of 1978, as amended, 
$3,000,000.

                       Court of Veterans Appeals


                         salaries and expenses


    For necessary expenses for the operation of the United 
States Court of Veterans Appeals as authorized by 38 U.S.C. 
sections 7251-7298, $9,319,000, of which $790,000, shall be 
available for the purpose of providing financial assistance as 
described, and in accordance withthe process and reporting 
procedures set fourth, under this heading in Public Law 102-229.

                      Department of Defense--Civil

                       Cemeterial Expenses, Army


                         salaries and expenses


    For necessary expenses, as authorized by law, for 
maintenance, operation, and improvement of Arlington National 
Cemetery and Soldiers' and Airmen's Home National Cemetery, 
including the purchase of two passenger motor vehicles for 
replacement only, and not to exceed $1,000 for official 
reception and representation expenses, $11,815,000, to remain 
available until expended.

                    Environmental Protection Agency


                         science and technology


                     (including transfer of funds)


    For science and technology, including research and 
development activities, which shall include research and 
development activities under the Comprehensive Environmental 
Response, Compensation, and Liability Act of 1980 (CERCLA), as 
amended; necessary expenses for personnel and related costs and 
travel expenses, including uniforms, or allowances therefore, 
as authorized by 5 U.S.C. 5901-5902; services as authorized by 
5 U.S.C. 3109, but at rates for individuals not to exceed the 
per diem rate equivalent to the rate for GS-18; procurement of 
laboratory equipment and supplies; other operating expenses in 
support of research and development; construction, alteration, 
repair, rehabilitation, and renovation of facilities, not to 
exceed $75,000 per project, $631,000,000, which shall remain 
available until September 30, 1999: Provided, That $49,600,000 
of the funds appropriated under this heading shall be to 
conduct and administer a comprehensive, peer-reviewed, near- 
and long-term particulate matter research program in accordance 
with the terms and conditions set forth for such research 
program in the conference report and joint explanatory 
statement of the committee of conference accompanying this Act 
(H.R. 2158): Provided further, That no later than 30 days 
following enactment of this Act, the Environmental Protection 
Agency shall enter into a contract or cooperative agreement 
with the National Academy of Sciences to develop a 
comprehensive, prioritized, near- and long-term particulate 
matter research program and monitoring plan in accordance with 
the terms and conditions set forth in the conference report and 
joint explanatory statement of the committee of conference 
accompanying this Act (H.R. 2158).


                 environmental programs and management


    For environmental programs and management, including 
necessary expenses, not otherwise provided for, for personnel 
and related costs and travel expenses, including uniforms, or 
allowances therefore, as authorized by 5 U.S.C. 5901-5902; 
services as authorized by 5 U.S.C. 3109, but at rates for 
individuals not to exceed the per diem rate equivalent to the 
rate for GS-18; hire of passenger motor vehicles; hire, 
maintenance, and operation of aircraft; purchase of reprints; 
library memberships in societies or associations which issue 
publications to members only or at a price to members lower 
than to subscribers who are not members; construction, 
alteration, repair, rehabilitation, and renovation of 
facilities, not to exceed $75,000 per project; and not to 
exceed $6,000 for official reception and representation 
expenses, $1,801,000,000, which shall remain available until 
September 30, 1999.


                      office of inspector general


    For necessary expenses of the Office of Inspector General 
in carrying out the provisions of the Inspector General Act of 
1978, as amended, and for construction, alteration, repair, 
rehabilitation, and renovation of facilities, not to exceed 
$75,000 per project, $28,501,000, to remain available until 
September 30, 1999.


                        buildings and facilities


    For construction, repair, improvement, extension, 
alteration, and purchase of fixed equipment or facilities of, 
or for use by, the Environmental Protection Agency, 
$109,420,000, to remain available until expended: Provided, 
That the Environmental Protection Agency is authorized to 
establish and construct a consolidated researchfacility at 
Research Triangle Park, North Carolina, at a maximum total construction 
cost of $272,700,000, and to obligate such monies as are made available 
by this Act for this purpose.


                     hazardous substance superfund


                     (including transfer of funds)


    For necessary expenses to carry out the Comprehensive 
Environmental Response, Compensation, and Liability Act of 1980 
(CERCLA), as amended, including sections 111 (c)(3), (c)(5), 
(c)(6), and (e)(4) (42 U.S.C. 9611), and for construction, 
alteration, repair, rehabilitation, and renovation of 
facilities, not to exceed $75,000 per project; not to exceed 
$2,150,000,000 (of which $100,000,000 shall not become 
available until September 1, 1998), to remain available until 
expended, consisting of $1,900,000,000, as authorized by 
section 517(a) of the Superfund Amendments and Reauthorization 
Act of 1986 (SARA), as amended by Public Law 101-508, and 
$250,000,000 as a payment from general revenues to the 
Hazardous Substance Superfund as authorized by section 517(b) 
of SARA, as amended by Public Law 101-508: Provided, That funds 
appropriated under this heading may be allocated to other 
Federal agencies in accordance with section 111(a) of CERCLA: 
Provided further, That of the funds appropriated under this 
heading, $650,000,000 shall not become available for obligation 
until October 1, 1998, and, further, shall be available for 
obligation only upon enactment by May 15, 1998, of specific 
legislation which reauthorizes the Superfund program: Provided 
further, That $11,641,000 of the funds appropriated under this 
heading shall be transferred to the ``Office of Inspector 
General'' appropriation to remain available until September 30, 
1999: Provided further, That notwithstanding section 111(m) of 
CERCLA or any other provision of law, $74,000,000 of the funds 
appropriated under this heading shall be available to the 
Agency for Toxic Substances and Disease Registry to carry out 
activities described in sections 104(i), 111(c)(4), and 
111(c)(14) of CERCLA and section 118(f) of SARA: Provided 
further, That $35,000,000 of the funds appropriated under this 
heading shall be transferred to the ``Science and Technology'' 
appropriation to remain available until September 30, 1999: 
Provided further, That none of the funds appropriated under 
this heading shall be used for Brownfields revolving loan funds 
unless specifically authorized by subsequent legislation: 
Provided further, That none of the funds appropriated under 
this heading shall be available for the Agency for Toxic 
Substances and Disease Registry to issue in excess of 40 
toxicological profiles pursuant to section 104(i) of CERCLA 
during fiscal year 1998.

                leaking underground storage tank program

                     (including transfer of funds)

    For necessary expenses to carry out leaking underground 
storage tank cleanup activities authorized by section 205 of 
the Superfund Amendments and Reauthorization Act of 1986, and 
for construction, alteration, repair, rehabilitation, and 
renovation of facilities, not to exceed $75,000 per project, 
$65,000,000, to remain available until expended: Provided, That 
no more than $7,500,000 shall be available for administrative 
expenses.


                           oil spill response


                     (including transfer of funds)


    For expenses necessary to carry out the Environmental 
Protection Agency's responsibilities under the Oil Pollution 
Act of 1990, $15,000,000, to be derived from the Oil Spill 
Liability trust fund, and to remain available until expended: 
Provided, That not more than $9,000,000 of these funds shall be 
available for administrative expenses.


                   state and tribal assistance grants


    For environmental programs and infrastructure assistance, 
including capitalization grants for State revolving funds and 
performance partnership grants, $3,213,125,000, to remain 
available until expended, of which $1,350,000,000 shall be for 
making capitalization grants for the Clean Water State 
Revolving Funds undertitle VI of the Federal Water Pollution 
Control Act, as amended, and $725,000,000 shall be for capitalization 
grants for the Drinking Water State Revolving Funds under section 1452 
of the Safe Drinking Water Act, as amended; $75,000,000 for 
architectural, engineering, planning, design, construction and related 
activities in connection with the construction of high priority water 
and wastewater facilities in the area of the United States-Mexico 
Border, after consultation with the appropriate border commission; 
$50,000,000 for grants to the State of Texas which shall be matched by 
state funds from state resources at 20 percent of the federal 
appropriation for the purpose of improving water and wastewater 
treatment for colonias; $15,000,000 for grants to the State of Alaska 
to address drinking water and wastewater infrastructure needs of rural 
and Alaska Native Villages as provided by section 303 of Public Law 
104-182; $253,125,000 for making grants for the construction of 
wastewater and water treatment facilities and groundwater protection 
infrastructure in accordance with the terms and conditions specified 
for such grants in the conference report and joint explanatory 
statement of the committee of conference accompanying this Act (H.R. 
2158); and $745,000,000 for grants to States, federally recognized 
tribes, and air pollution control agencies for multi-media or single 
media pollution prevention, control and abatement and related 
activities pursuant to the provisions set forth under this heading in 
Public Law 104-134, provided that eligible recipients of these funds 
and the funds made available for this purpose since fiscal year 1996 
and hereafter include States, federally recognized tribes, interstate 
agencies, tribal consortia, and air pollution control agencies, as 
provided in authorizing statutes, subject to such terms and conditions 
as the Administrator shall establish, and for making grants under 
section 103 of the Clean Air Act for particulate matter monitoring and 
data collection activities: Provided, That, consistent with section 
1452(g) of the Safe Drinking Water Act (42 U.S.C. 300j-12(g)), section 
302 of the Safe Drinking Water Act Amendments of 1996 (Public Law 104-
182) and the accompanying joint explanatory statement of the committee 
on conference (H. Rept. No. 104-741 to accompany S. 1316, the Safe 
Drinking Water Act Amendments of 1996), and notwithstanding any other 
provision of law, States may combine the assets of State Revolving 
Funds (SRFs) established under section 1452 of the Safe Drinking Water 
Act, as amended, and title VI of the Federal Water Pollution Control 
Act, as amended, as security for bond issues to enhance the lending 
capacity of one or both SRFs, but not to acquire the state match for 
either program, providedthat revenues from the bonds are allocated to 
the purposes of the Safe Drinking Water Act and the Federal Water 
Pollution Control Act in the same portion as the funds are used as 
security for the bonds: Provided further, That, hereafter from funds 
appropriated under this heading, the Administrator is authorized to 
make grants to federally recognized Indian governments for the 
development of multi-media environmental programs: Provided further, 
That, hereafter, the funds available under this heading for grants to 
States, federally recognized tribes, and air pollution control agencies 
for multi-media or single media pollution prevention, control and 
abatement and related activities may also be used for the direct 
implementation by the Federal Government of a program required by law 
in the absence of an acceptable State or tribal program: Provided 
further, That notwithstanding any other provision of law, in the case 
of a publicly owned treatment works in the District of Columbia, the 
Federal share of grants awarded under title II of the Federal Water 
Pollution Control Act, beginning October 1, 1997, and continuing 
through September 30, 1999, shall be 80 percent of the cost of 
construction, and all grants made to such publicly owned treatment 
works in the District of Columbia may include an advance of allowance 
under section 201(l)(2): Provided further, That, notwithstanding any 
other provision of law, the Administrator is authorized to make a grant 
of $4,326,000 under title II of the Federal Water Pollution Control 
Act, as amended, from funds appropriated in prior years under section 
205 of the Act for the State of Florida and available due to 
deobligation, to the appropriate instrumentality for wastewater 
treatment works in Monroe County, Florida.


                          working capital fund


    Under this heading in Public Law 104-204, delete the 
following: the phrases, ``franchise fund pilot to be known as 
the''; ``as authorized by section 403 of Public Law 103-356,''; 
and ``as provided in such section''; and the final proviso. 
After the phrase, ``to be available'', insert ``without fiscal 
year limitation''.

                   Executive Office of the President


                office of science and technology policy


    For necessary expenses of the Office of Science and 
Technology Policy, in carrying out the purposes of the National 
Science and Technology Policy, Organization, and Priorities Act 
of 1976 (42 U.S.C. 6601 and 6671), hire of passenger motor 
vehicles, and services as authorized by 5 U.S.C. 3109, not to 
exceed $2,500 for official reception and representation 
expenses, and rental of conference rooms in the District of 
Columbia, $4,932,000.


  council on environmental quality and office of environmental quality


    For necessary expenses to continue functions assigned to 
the Council on Environmental Quality and Office of 
Environmental Quality pursuant to the National Environmental 
Policy Act of 1969, the Environmental Quality Improvement Act 
of 1970, and Reorganization Plan No. 1 of 1977, $2,500,000: 
Provided, That, notwithstanding any other provision of law, no 
funds other than those appropriated under this heading, shall 
be used for or by the Council on Environmental Quality and 
Office of Environmental Quality: Provided further, That 
notwithstanding section 202 of the National Environmental 
Policy Act of 1970, the Council shall consist of one member, 
appointed by the President, by and with the advice and consent 
of the Senate, serving as Chairman and exercising all powers, 
functions, and duties of the Council.

                          Unanticipated Needs

    For expenses necessary to enable the President to meet 
unanticipated needs, in furtherance of the national interest, 
security, or defense which may arise at home or abroad during 
the current fiscal year; $1,000,000.

                 Federal Deposit Insurance Corporation


                      office of inspector general


                     (including transfer of funds)


    For necessary expenses of the Office of Inspector General 
in carrying out the provisions of the Inspector General Act of 
1978, as amended, $34,365,000, to be derived from the Bank 
Insurance Fund, the Savings Association Insurance Fund, and the 
FSLIC Resolution Fund.

                  Federal Emergency Management Agency


                            disaster relief


    For necessary expenses in carrying out the Robert T. 
Stafford Disaster Relief and Emergency Assistance Act (42 
U.S.C. 5121 et seq.), $320,000,000, and, notwithstanding 42 
U.S.C. 5203, to remain available until expended.


            disaster assistance direct loan program account


    For the cost of direct loans, $1,495,000, as authorized by 
section 319 of the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act: Provided, That such costs, including 
the cost of modifying such loans, shall be as defined in 
section 502 of the Congressional Budget Act of 1974, as 
amended: Provided further, That these funds are available to 
subsidize gross obligations for the principal amount of direct 
loans not to exceed $25,000,000.
    In addition, for administrative expenses to carry out the 
direct loan program, $341,000.


                         salaries and expenses


    For necessary expenses, not otherwise provided for, 
including hire and purchase of motor vehicles as authorized by 
31 U.S.C. 1343; uniforms, or allowances therefor, as authorized 
by 5 U.S.C. 5901-5902; services as authorized by 5 U.S.C. 3109, 
but at rates for individuals not to exceed the per diem rate 
equivalent to the rate for GS-18; expenses of attendance of 
cooperating officials and individuals at meetings concerned 
with the work of emergency preparedness; transportation in 
connection with the continuity of Government programs to the 
same extent and in the same manner as permitted the Secretary 
of a Military Department under 10 U.S.C. 2632; and not to 
exceed $2,500 for official reception and representation 
expenses, $171,773,000.


                      office of inspector general


    For necessary expenses of the Office of Inspector General 
in carrying out the Inspector General Act of 1978, as amended, 
$4,803,000.


              emergency management planning and assistance


    For necessary expenses, not otherwise provided for, to 
carry out activities under the National Flood Insurance Act of 
1968, as amended, and the Flood Disaster Protection Act of 
1973, as amended (42 U.S.C. 4001 et seq.), the Robert T. 
Stafford Disaster Relief and Emergency Assistance Act (42 
U.S.C. 5121 et seq.), the Earthquake Hazards Reduction Act of 
1977, as amended (42 U.S.C. 7701 et seq.), the Federal Fire 
Prevention and Control Act of 1974, as amended (15 U.S.C. 2201 
et seq.), the Defense Production Act of 1950, as amended (50 
U.S.C. App. 2061 et seq.), sections 107 and 303 of the National 
Security Act of 1947, as amended (50 U.S.C. 404-405), and 
Reorganization Plan No. 3 of 1978, $243,546,000: Provided, That 
for purposes of pre-disaster mitigation pursuant to 42 U.S.C. 
5131 (b) and (c) and 42 U.S.C. 5196 (e) and (i), $30,000,000 of 
the funds made available under this heading shall be available 
until expended for project grants: Provided further, That the 
Director of the Federal Emergency Management Agency shall make 
a grant for $1,500,000 to resolve issues under the Uniform 
Relocation Assistance and Real Property Acquisition Policies 
Act of 1970, Public Law 91-646, involving the City of Jackson, 
Mississippi.


                   emergency food and shelter program


    To carry out an emergency food and shelter program pursuant 
to title III of Public Law 100-77, as amended, $100,000,000: 
Provided, That total administrative costs shall not exceed 
three and one-half percent of the total appropriation.


                     national flood insurance fund


                     (including transfer of funds)


    For activities under the National Flood Insurance Act of 
1968, the Flood Disaster Protection Act of 1973, and the 
National Flood Insurance Reform Act of 1994, not to exceed 
$21,610,000 for salaries and expenses associated with flood 
mitigation and flood insurance operations, and not to exceed 
$78,464,000 for flood mitigation, including up to $20,000,000 
for expenses under section 1366 of the National Flood Insurance 
Act, which amount shall be available for transfer to the 
National Flood Mitigation Fund until September 30, 1999. In 
fiscal year 1998, no funds in excess of (1) $47,000,000 for 
operating expenses, (2) $375,165,000 for agents' commissions 
and taxes, and (3) $50,000,000 for interest on Treasury 
borrowings shall be available from the National Flood Insurance 
Fund without prior notice to the Committees on Appropriations. 
For fiscal year 1998, flood insurance rates shall not exceed 
the level authorized by the National Flood Insurance Reform Act 
of 1994.
    Section 1309(a)(2) of the National Flood Insurance Act (42 
U.S.C. 4016(a)(2)), as amended by Public Law 104-208, is 
further amended by striking the date ``1997'' and inserting in 
lieu thereof the date ``1998''.
    Section 1319 of the National Flood Insurance Act of 1968, 
as amended (42 U.S.C. 4026), is amended by striking ``October 
23, 1997'' and inserting ``September 30, 1998''.
    Section 1336 of the National Flood Insurance Act of 1968, 
as amended (42 U.S.C. 4056), is amended by striking ``October 
23, 1997'' and inserting ``September 30, 1998''.
    The first sentence of section 1376(c) of the National Flood 
Insurance Act of 1968, as amended (42 U.S.C. 4127(c)), is 
amended by striking all after ``to be appropriated'' and 
inserting ``such sums as may be necessary through September 30, 
1998, for studies under this title.''.


                        administrative provision


    The Director of the Federal Emergency Management Agency 
shall promulgate through rulemaking a methodology for 
assessment and collection of fees to be assessed and collected 
beginning in fiscal year 1998 applicable to persons subject to 
the Federal Emergency Management Agency's radiological 
emergency preparedness regulations. The aggregate charges 
assessed pursuant to this section during fiscal year 1998 shall 
approximate, but not be less than, 100 per centum of the 
amounts anticipated by the Federal Emergency Management Agency 
to be obligated for its radiological emergency preparedness 
program for such fiscal year. The methodology for assessment 
and collection of fees shall be fair and equitable, and shall 
reflect the full amount of costs of providing radiological 
emergency planning, preparedness, response and associated 
services. Such fees shall be assessed in a manner that reflects 
the use of agency resources for classes of regulated persons 
and the administrative costs of collecting such fees. Fees 
received pursuant to this section shall be deposited in the 
general fund of the Treasury as offsetting receipts. Assessment 
and collection of such fees are only authorized during fiscal 
year 1998.

                    General Services Administration


                    consumer information center fund


    For necessary expenses of the Consumer Information Center, 
including services authorized by 5 U.S.C. 3109, $2,419,000, to 
be deposited into the Consumer Information Center Fund: 
Provided, That the appropriations, revenues and collections 
deposited into the fund shall be available for necessary 
expenses of Consumer Information Center activities in the 
aggregate amount of $7,500,000. Appropriations, revenues, and 
collections accruing to this fund during fiscal year 1998 in 
excess of $7,500,000 shall remain in the fund and shall not be 
available for expenditure except as authorized in 
appropriations Acts: Provided further, That notwithstanding any 
other provision of law, the Consumer Information Center may 
accept and deposit to this account, during fiscal year 1998 and 
hereafter, gifts for the purpose of defraying its costs of 
printing, publishing, and distributing consumer information and 
educational materials and undertaking other consumer 
information activities; may expend those gifts for those 
purposes, in addition to amounts appropriated or otherwise made 
available; and the balance shall remain available for 
expenditure for such purpose.

             National Aeronautics and Space Administration


                           human space flight


    For necessary expenses, not otherwise provided for, in the 
conduct and support of human space flight research and 
development activities, including research, development, 
operations, and services; maintenance; construction of 
facilities including repair, rehabilitation, and modification 
of real and personal property, and acquisition or condemnation 
of real property, as authorized by law; space flight, 
spacecraft control and communications activities including 
operations, production, and services; and purchase, lease, 
charter, maintenance and operation of mission and 
administrative aircraft, $5,506,500,000, to remain available 
until September 30, 1999: Provided, That of the $2,351,300,000 
made available under this heading for Space Station activities, 
only $1,500,000,000 shall be available before March 31, 1998.


                  science, aeronautics and technology


    For necessary expenses, not otherwise provided for, in the 
conduct and support of science, aeronautics and technology 
research and development activities, including research, 
development, operations, and services; maintenance; 
construction of facilities including repair, rehabilitation, 
and modification of real and personal property, and acquisition 
or condemnation of real property, as authorized by law; space 
flight, spacecraft control and communications activities 
including operations, production, and services; and purchase, 
lease, charter, maintenance and operation of mission and 
administrative aircraft, $5,690,000,000, to remain available 
until September 30, 1999.


                            mission support


    For necessary expenses, not otherwise provided for, in 
carrying out mission support for human space flight programs 
and science, aeronautical, and technology programs, including 
research operations and support; space communications 
activities including operations, production and services; 
maintenance; construction of facilities including repair, 
rehabilitation, and modification of facilities, minor 
construction of new facilities and additions to existing 
facilities, facility planning and design, environmental 
compliance and restoration, and acquisition or condemnation of 
real property, as authorized by law; program management; 
personnel and related costs, including uniforms or allowances 
therefor, as authorized by 5 U.S.C. 5901-5902; travel expenses; 
purchase, lease, charter, maintenance, and operation of mission 
and administrative aircraft; not to exceed $35,000 for official 
reception and representation expenses; and purchase (not to 
exceed 33 for replacement only) and hire of passenger motor 
vehicles; $2,433,200,000, to remain available until September 
30, 1999.


                      office of inspector general


    For necessary expenses of the Office of Inspector General 
in carrying out the Inspector General Act of 1978, as amended, 
$18,300,000.


                       administrative provisions


    Notwithstanding the limitation on the availability of funds 
appropriated for ``Human space flight'', ``Science, aeronautics 
and technology'', or ``Mission support'' by this appropriations 
Act, when any activity has been initiated by the incurrence of 
obligations for construction of facilities as authorized by 
law, such amount available for such activity shall remain 
available until expended. This provision does not apply to the 
amounts appropriated in ``Mission support'' pursuant to the 
authorization for repair, rehabilitation and modification of 
facilities, minor construction of new facilities and additions 
to existing facilities, and facility planning and design.
    Notwithstanding the limitation on the availability of funds 
appropriated for ``Human space flight'', ``Science, aeronautics 
and technology'', or ``Mission support'' by this appropriations 
Act, the amounts appropriated for construction of facilities 
shall remain available until September 30, 2000.
    Notwithstanding the limitation on the availability of funds 
appropriated for ``Mission support'' and ``Office of Inspector 
General'', amounts made available by this Act for personnel and 
related costs and travel expenses of the National Aeronautics 
and Space Administration shall remain available until September 
30, 1998 and may be used to enter into contracts for training, 
investigations, costs associated with personnel relocation, and 
for other services, to be provided during the next fiscal year.
    Of the funds provided to the National Aeronautics and Space 
Administration in this Act, the Administrator shall by November 
1, 1998, make available no less than $400,000 for a study by 
the National Research Council, with an interim report to be 
completed by June 1, 1998, that evaluates, in terms of the 
potential impact on the Space Station's assembly schedule, 
budget, and capabilities, the engineering challenges posed by 
extravehicular activity (EVA) requirements, United States and 
non-United States space launch requirements, the potential need 
to upgrade or replace equipment and components after assembly 
complete, and the requirement to decommission and disassemble 
the facility.

                  National Credit Union Administration


                       central liquidity facility


    During fiscal year 1998, gross obligations of the Central 
Liquidity Facility for the principal amount of new direct loans 
to member credit unions, as authorized by the National Credit 
Union Central Liquidity Facility Act (12 U.S.C. 1795), shall 
not exceed $600,000,000: Provided, That administrative expenses 
of the Central Liquidity Facility in fiscal year 1998 shall not 
exceed $203,000: Provided further, That $1,000,000, together 
with amounts of principal and interest on loans repaid, to be 
available until expended, is available for loans to community 
development credit unions.

                      National Science Foundation


                    research and related activities


    For necessary expenses in carrying out the National Science 
Foundation Act of 1950, as amended (42 U.S.C. 1861-1875), and 
the Act to establish a National Medal of Science (42 U.S.C. 
1880-1881); services as authorized by 5 U.S.C. 3109; 
maintenance and operation of aircraft and purchase of flight 
services for research support; acquisition of aircraft; 
$2,545,700,000, of which not to exceed $228,530,000 shall 
remain available until expended for Polar research and 
operations support, and for reimbursement to other Federal 
agencies for operational and science support and logistical and 
other related activities for the United States Antarctic 
program; the balance to remain available until September 30, 
1999: Provided, That receipts for scientific support services 
and materials furnished by the National Research Centers and 
other National Science Foundation supported research 
facilitiesmay be credited to this appropriation: Provided further, That 
to the extent that the amount appropriated is less than the total 
amount authorized to be appropriated for included program activities, 
all amounts, including floors and ceilings, specified in the 
authorizing Act for those program activities or their subactivities 
shall be reduced proportionally: Provided further, That $40,000,000 of 
the funds available under this heading shall be made available for a 
comprehensive research initiative on plant genomes for economically 
significant crop.


                        major research equipment


    For necessary expenses of major construction projects 
pursuant to the National Science Foundation Act of 1950, as 
amended, $109,000,000, to remain available until expended, of 
which $35,000,000 shall become available on September 30, 1998.


                     education and human resources


    For necessary expenses in carrying out science and 
engineering education and human resources programs and 
activities pursuant to the National Science Foundation Act of 
1950, as amended (42 U.S.C. 1861-1875), including services as 
authorized by 5 U.S.C. 3109 and rental of conference rooms in 
the District of Columbia, $632,500,000, to remain available 
until September 30, 1999: Provided, That to the extent that the 
amount of this appropriation is less than the total amount 
authorized to be appropriated for included program activities, 
all amounts, including floors and ceilings, specified in the 
authorizing Act for those program activities or their 
subactivities shall be reduced proportionally.


                         salaries and expenses


    For salaries and expenses necessary in carrying out the 
National Science Foundation Act of 1950, as amended (42 U.S.C. 
1861-1875); services authorized by 5 U.S.C. 3109; hire of 
passenger motor vehicles; not to exceed $9,000 for official 
reception and representation expenses; uniforms or allowances 
therefor, as authorized by 5 U.S.C. 5901-5902; rental of 
conference rooms in the District of Columbia; reimbursement of 
the General Services Administration for security guard services 
and headquarters relocation; $136,950,000: Provided, That 
contracts may be entered into under ``Salaries and expenses'' 
in fiscal year 1998 for maintenance and operation of 
facilities, and for other services, to be provided during the 
next fiscal year.


                      office of inspector general


    For necessary expenses of the Office of Inspector General 
as authorized by the Inspector General Act of 1978, as amended, 
$4,850,000, to remain available until September 30, 1999.

                 Neighborhood Reinvestment Corporation


          payment to the neighborhood reinvestment corporation


    For payment to the Neighborhood Reinvestment Corporation 
for use in neighborhood reinvestment activities, as authorized 
by the Neighborhood Reinvestment Corporation Act (42 U.S.C. 
8101-8107), $60,000,000.

                        Selective Service System


                         salaries and expenses


    For necessary expenses of the Selective Service System, 
including expenses of attendance at meetings and of training 
for uniformed personnel assigned to the Selective Service 
System, as authorized by 5 U.S.C. 4101-4118 for civilian 
employees; and not to exceed $1,000 for official reception and 
representation expenses; $23,413,000: Provided, That during the 
current fiscal year, the President may exempt this 
appropriation from the provisions of 31 U.S.C. 1341, whenever 
he deems such action to be necessary in the interest of 
national defense: Provided further, That none of the funds 
appropriated by this Act may be expended for or in connection 
with the induction of any person into the Armed Forces of the 
United States.

                      TITLE IV--GENERAL PROVISIONS

    Sec. 401. Where appropriations in titles I, II, and III of 
this Act are expendable for travel expenses and no specific 
limitation has been placed thereon, the expenditures for such 
travel expenses may not exceed the amounts set forth therefore 
in the budget estimates submitted for the appropriations: 
Provided, That this provision does not apply to accounts that 
do not contain an object classification for travel: Provided 
further, That this section shall not apply to travel performed 
by uncompensated officials of local boards and appeal boards of 
the Selective Service System; to travel performed directly in 
connection with care and treatment of medical beneficiaries of 
the Department of Veterans Affairs; to travel performed in 
connection with major disasters or emergencies declared or 
determined by the President under the provisions of the Robert 
T. Stafford Disaster Relief and Emergency Assistance Act; to 
travel performed by the Offices of Inspector General in 
connection with audits and investigations; or to payments to 
interagency motor pools where separately set forth in the 
budget schedules: Provided further, That if appropriations in 
titles I, II, and III exceed the amounts set forth in budget 
estimates initially submitted for such appropriations, the 
expenditures for travel may correspondingly exceed the amounts 
therefore set forth in the estimates in the same proportion.
    Sec. 402. Appropriations and funds available for the 
administrative expenses of the Department of Housing and Urban 
Development and the Selective Service System shall be available 
in the current fiscal year for purchase of uniforms, or 
allowances therefor, as authorized by 5 U.S.C. 5901-5902; hire 
of passenger motor vehicles; and services as authorized by 5 
U.S.C. 3109.
    Sec. 403. Funds of the Department of Housing and Urban 
Development subject to the Government Corporation Control Act 
or section 402 of the Housing Act of 1950 shall be available, 
without regard to the limitations on administrative expenses, 
for legal services on a contract or fee basis, and for 
utilizing and making payment for services and facilities of 
Federal National Mortgage Association, Government National 
Mortgage Association, Federal Home Loan Mortgage Corporation, 
Federal Financing Bank, Federal Reserve banks or any member 
thereof, Federal Home Loan banks, and any insured bank within 
the meaning of the Federal Deposit Insurance Corporation Act, 
as amended (12 U.S.C. 1811-1831).
    Sec. 404. No part of any appropriation contained in this 
Act shall remain available for obligation beyond the current 
fiscal year unless expressly so provided herein.
    Sec. 405. No funds appropriated by this Act may be 
expended--
            (1) pursuant to a certification of an officer or 
        employee of the United States unless--
                    (A) such certification is accompanied by, 
                or is part of, a voucher or abstract which 
                describes the payee or payees and the items or 
                services for which such expenditure is being 
                made, or
                    (B) the expenditure of funds pursuant to 
                such certification, and without such a voucher 
                or abstract, is specifically authorized by law; 
                and
            (2) unless such expenditure is subject to audit by 
        the General Accounting Office or is specifically exempt 
        by law from such audit.
    Sec. 406. None of the funds provided in this Act to any 
department or agency may be expended for the transportation of 
any officer or employee of such department or agency between 
his domicile and his place of employment, with the exception of 
any officer or employee authorized such transportation under 31 
U.S.C. 1344 or 5 U.S.C. 7905.
    Sec. 407. None of the funds provided in this Act may be 
used for payment, through grants or contracts, to recipients 
that do not share in the cost of conducting research resulting 
from proposals not specifically solicited by the Government: 
Provided, That the extent of cost sharing by the recipient 
shall reflect the mutuality of interest of the grantee or 
contractor and the Government in the research.
    Sec. 408. None of the funds in this Act may be used, 
directly or through grants, to pay or to provide reimbursement 
for payment of the salary of a consultant (whether retained by 
the Federal Government or a grantee) at more than the daily 
equivalent of the rate paid for level IV of the Executive 
Schedule, unless specifically authorized by law.
    Sec. 409. None of the funds provided in this Act shall be 
used to pay the expenses of, or otherwise compensate, non-
Federal parties intervening in regulatory or adjudicatory 
proceedings. Nothing herein affects the authority of the 
Consumer Product Safety Commission pursuant to section 7 of the 
Consumer Product Safety Act (15 U.S.C. 2056 et seq.).
    Sec. 410. Except as otherwise provided under existing law 
or under an existing Executive Order issued pursuant to an 
existing law, the obligation or expenditure of any 
appropriation under this Act for contracts for any consulting 
service shall be limited to contracts which are (1) a matter of 
public record and available for public inspection, and (2) 
thereafter included in a publicly available list of all 
contracts entered into within twenty-four months prior to the 
date on which the list is made available to the public and of 
all contracts on which performance has not been completed by 
such date. The list required by the preceding sentence shall be 
updated quarterly and shall include a narrative description of 
the work to be performed under each such contract.
    Sec. 411. Except as otherwise provided by law, no part of 
any appropriation contained in this Act shall be obligated or 
expended by any executive agency, as referred to in the Office 
of Federal Procurement Policy Act (41 U.S.C. 401 et seq.), for 
a contract for services unless such executive agency (1) has 
awarded and entered into such contract in full compliance with 
such Act and the regulations promulgated thereunder, and (2) 
requires any report prepared pursuant to such contract, 
including plans, evaluations, studies, analyses and manuals, 
and any report prepared by the agency which is substantially 
derived from or substantially includes any report prepared 
pursuant to such contract, to contain information concerning 
(A) the contract pursuant to which the report was prepared, and 
(B) the contractor who prepared the report pursuant to such 
contract.
    Sec. 412. Except as otherwise provided in section 406, none 
of the funds provided in this Act to any department or agency 
shall be obligated or expended to provide a personal cook, 
chauffeur, or other personal servants to any officer or 
employee of such department or agency.
    Sec. 413. None of the funds provided in this Act to any 
department or agency shall be obligated or expended to procure 
passenger automobiles as defined in 15 U.S.C. 2001 with an EPA 
estimated miles per gallon average of less than 22 miles per 
gallon.
    Sec. 414. None of the funds appropriated in title I of this 
Act shall be used to enter into any new lease of real property 
if the estimated annual rental is more than $300,000 unless the 
Secretary submits, in writing, a report to the Committees on 
Appropriations of the Congress and a period of 30 days has 
expired following the date on which the report is received by 
the Committees on Appropriations.
    Sec. 415. (a) It is the sense of the Congress that, to the 
greatest extent practicable, all equipment and products 
purchased with funds made available in this Act should be 
American-made.
    (b) In providing financial assistance to, or entering into 
any contract with, any entity using funds made available in 
this Act, the head of each Federal agency, to the greatest 
extent practicable, shall provide to such entity a notice 
describing the statement made in subsection (a) by the 
Congress.
    Sec. 416. None of the funds appropriated in this Act may be 
used to implement any cap on reimbursements to grantees for 
indirect costs, except as published in Office of Management and 
Budget Circular A-21.
    Sec. 417. Such sums as may be necessary for fiscal year 
1998 pay raises for programs funded by this Act shall be 
absorbed within the levels appropriated in this Act.
    Sec. 418. None of the funds made available in this Act may 
be used for any program, project, or activity, when it is made 
known to the Federal entity or official to which the funds are 
made available that the program, project, or activity is not in 
compliance with any Federal law relating to risk assessment, 
the protection of private property rights, or unfunded 
mandates.
    Sec. 419. Corporations and agencies of the Department of 
Housing and Urban Development which are subject to the 
Government Corporation Control Act, as amended, are hereby 
authorized to make such expenditures, within the limits of 
funds and borrowing authority available to each such 
corporation or agency and in accord with law, and to make such 
contracts and commitments without regard to fiscal year 
limitations as provided by section 104 of the Act as may be 
necessary in carrying out the programs set forth in the budget 
for 1998 for such corporation or agency except as hereinafter 
provided: Provided, That collections of these corporations and 
agencies may be used for new loan or mortgage purchase 
commitments only to the extent expressly provided for in this 
Act (unless such loans are in support of other forms of 
assistance provided for in this or prior appropriations Acts), 
except that this proviso shall not apply to the mortgage 
insurance or guaranty operations of these corporations, or 
where loans or mortgage purchases are necessary to protect the 
financial interest of the United States Government.
    Sec. 420. Notwithstanding section 320(g) of the Federal 
Water Pollution Control Act (33 U.S.C. 1330(g)), funds made 
available pursuant to authorization under such section for 
fiscal year 1998 and prior fiscal years may be used for 
implementing comprehensive conservation and management plans.
    Sec. 421. Such funds as may be necessary to carry out the 
orderly termination of the Office of Consumer Affairs shall be 
made available from funds appropriated to the Department of 
Health and Human Services for fiscal year 1998.
    Sec. 422. Notwithstanding any other provision of law, the 
term ``qualified student loan'' with respect to national 
service education awards shall mean any loan made directly to a 
student by the Alaska Commission on Postsecondary Education, in 
addition to other meanings under section 148(b)(7) of the 
National and Community Service Act.

                TITLE V--HUD MULTIFAMILY HOUSING REFORM

SEC. 501. TABLE OF CONTENTS.

    The table of contents for this title is as follows:

                 TITLE V--HUD MULTIFAMILY HOUSING REFORM

Sec. 510. Short title.

    Subtitle A--FHA-Insured Multifamily Housing Mortgage and Housing 
                        Assistance Restructuring

Sec. 511. Findings and purposes.
Sec. 512. Definitions.
Sec. 513. Authority of participating administrative entities.
Sec. 514. Mortgage restructuring and rental assistance sufficiency plan.
Sec. 515. Section 8 renewals and long-term affordability commitment by 
          owner of project.
Sec. 516. Prohibition on restructuring.
Sec. 517. Restructuring tools.
Sec. 518. Management standards.
Sec. 519. Monitoring of compliance.
Sec. 520. Reports to Congress.
Sec. 521. GAO audit and review.
Sec. 522. Regulations.
Sec. 523. Technical and conforming amendments.
Sec. 524. Section 8 contract renewals.

                  Subtitle B--Miscellaneous Provisions

Sec. 531. Rehabilitation grants for certain insured projects.
Sec. 532. GAO report on Section 8 rental assistance for multifamily 
          housing projects.

                   Subtitle C--Enforcement Provisions

Sec. 541. Implementation.
Sec. 542. Income verification.

             PART 1--FHA SINGLE FAMILY AND MULTIFAMILY HOUSING

Sec. 551. Authorization to immediately suspend mortgagees.
Sec. 552. Extension of equity skimming to other single family and 
          multifamily housing programs.
Sec. 553. Civil money penalties against mortgagees, lenders, and other 
          participants in FHA programs.

                    PART 2--FHA MULTIFAMILY PROVISIONS

Sec. 561. Civil money penalties against general partners, officers, 
          directors, and certain managing agents of multifamily 
          projects.
Sec. 562. Civil money penalties for noncompliance with Section 8 HAP 
          contracts.
Sec. 563. Extension of double damages remedy.
Sec. 564. Obstruction of Federal audits.

   Subtitle D--Office of Multifamily Housing Assistance Restructuring

Sec. 571. Establishment of Office of Multifamily Housing Assistance 
          Restructuring.
Sec. 572. Director.
Sec. 573. Duty and authority of Director.
Sec. 574. Personnel.
Sec. 575. Budget and financial reports.
Sec. 576. Limitation on subsequent employment.
Sec. 577. Audits by GAO.
Sec. 578. Suspension of program because of failure to appoint Director.
Sec. 579. Termination.

SEC. 510. SHORT TITLE.

    This title may be cited as the ``Multifamily Assisted 
Housing Reform and Affordability Act of 1997''.

   Subtitle A--FHA-Insured Multifamily Housing Mortgage and Housing 
                        Assistance Restructuring

SEC. 511. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) there exists throughout the Nation a need for 
        decent, safe, and affordable housing;
            (2) as of the date of enactment of this Act, it is 
        estimated that--
                    (A) the insured multifamily housing 
                portfolio of the Federal Housing Administration 
                consists of 14,000 rental properties, with an 
                aggregate unpaid principal mortgage balance of 
                $38,000,000,000; and
                    (B) approximately 10,000 of these 
                properties contain housing units that are 
                assistedwith project-based rental assistance 
under section 8 of the United States Housing Act of 1937;
            (3) FHA-insured multifamily rental properties are a 
        major Federal investment, providing affordable rental 
        housing to an estimated 2,000,000 low- and very low-
        income families;
            (4) approximately 1,600,000 of these families live 
        in dwelling units that are assisted with project-based 
        rental assistance under section 8 of the United States 
        Housing Act of 1937;
            (5) a substantial number of housing units receiving 
        project-based assistance have rents that are higher 
        than the rents of comparable, unassisted rental units 
        in the same housing rental market;
            (6) many of the contracts for project-based 
        assistance will expire during the several years 
        following the date of enactment of this Act;
            (7) it is estimated that--
                    (A) if no changes in the terms and 
                conditions of the contracts for project-based 
                assistance are made before fiscal year 2000, 
                the cost of renewing all expiring rental 
                assistance contracts under section 8 of the 
                United States Housing Act of 1937 for both 
                project-based and tenant-based rental 
                assistance will increase from approximately 
                $3,600,000,000 in fiscal year 1997 to over 
                $14,300,000,000 by fiscal year 2000 and some 
                $22,400,000,000 in fiscal year 2006;
                    (B) of those renewal amounts, the cost of 
                renewing project-based assistance will increase 
                from $1,200,000,000 in fiscal year 1997 to 
                almost $7,400,000,000 by fiscal year 2006; and
                    (C) without changes in the manner in which 
                project-based rental assistance is provided, 
                renewals of expiring contracts for project-
                based rental assistance will require an 
                increasingly larger portion of the 
                discretionary budget authority of the 
                Department of Housing and Urban Development in 
                each subsequent fiscal year for the foreseeable 
                future;
            (8) absent new budget authority for the renewal of 
        expiring rental contracts for project-based assistance, 
        many of the FHA-insured multifamily housing projects 
        that are assisted with project-based assistance are 
        likely to default on their FHA-insured mortgage 
        payments, resulting in substantial claims to the FHA 
        General Insurance Fund and Special Risk Insurance Fund;
            (9) more than 15 percent of federally assisted 
        multifamily housing projects are physically or 
        financially distressed, including a number which suffer 
        from mismanagement;
            (10) due to Federal budget constraints, the 
        downsizing of the Department of Housing and Urban 
        Development, and diminished administrative capacity, 
        the Department lacks the ability to ensure the 
        continued economic and physical well-being of the stock 
        of federally insured and assisted multifamily housing 
        projects;
            (11) the economic, physical, and management 
        problems facing the stock of federally insured and 
        assisted multifamily housing projects will be best 
        served by reforms that--
                    (A) reduce the cost of Federal rental 
                assistance, including project-based assistance, 
                to these projects by reducing the debt service 
                and operating costs of these projects while 
                retaining the low-income affordability and 
                availability of this housing;
                    (B) address physical and economic distress 
                of this housing and the failure of some project 
                managers and owners of projects to complywith 
management and ownership rules and requirements; and
                    (C) transfer and share many of the loan and 
                contract administration functions and 
                responsibilities of the Secretary to and with 
                capable State, local, and other entities; and
            (12) the authority and duties of the Secretary, not 
        including the control by the Secretary of applicable 
        accounts in the Treasury of the United States, may be 
        delegated to State, local or other entities at the 
        discretion of the Secretary, to the extent the 
        Secretary determines, and for the purpose of carrying 
        out this Act, so that the Secretary has the discretion 
        to be relieved of processing and approving any document 
        or action required by these reforms.
    (b) Purposes.--Consistent with the purposes and 
requirements of the Government Performance and Results Act of 
1993, the purposes of this subtitle are--
            (1) to preserve low-income rental housing 
        affordability and availability while reducing the long-
        term costs of project-based assistance;
            (2) to reform the design and operation of Federal 
        rental housing assistance programs, administered by the 
        Secretary, to promote greater multifamily housing 
        project operating and cost efficiencies;
            (3) to encourage owners of eligible multifamily 
        housing projects to restructure their FHA-insured 
        mortgages and project-based assistance contracts in a 
        manner that is consistent with this subtitle before the 
        year in which the contract expires;
            (4) to reduce the cost of insurance claims under 
        the National Housing Act related to mortgages insured 
        by the Secretary and used to finance eligible 
        multifamily housing projects;
            (5) to streamline and improve federally insured and 
        assisted multifamily housing project oversight and 
        administration;
            (6) to resolve the problems affecting financially 
        and physically troubled federally insured and assisted 
        multifamily housing projects through cooperation with 
        residents, owners, State and local governments, and 
        other interested entities and individuals;
            (7) to protect the interest of project owners and 
        managers, because they are partners of the Federal 
        Government in meeting the affordable housing needs of 
        the Nation through the section 8 rental housing 
        assistance program;
            (8) to protect the interest of tenants residing in 
        the multifamily housing projects at the time of the 
        restructuring for the housing; and
            (9) to grant additional enforcement tools to use 
        against those who violate agreements and program 
        requirements, in order to ensure that the public 
        interest is safeguarded and that Federal multifamily 
        housing programs serve their intended purposes.

SEC. 512. DEFINITIONS.

    In this subtitle:
            (1) Comparable properties.--The term ``comparable 
        properties'' means properties in the same market areas, 
        where practicable, that--
                    (A) are similar to the eligible multifamily 
                housing project as to neighborhood (including 
                risk of crime), type of location, access, 
                street appeal, age, property size, apartment 
                mix, physical configuration, property and unit 
                amenities, utilities, and other relevant 
                characteristics; and
                    (B) are not receiving project-based 
                assistance.
            (2) Eligible multifamily housing project.--The term 
        ``eligible multifamily housing project'' means a 
        property consisting of more than 4 dwelling units--
                    (A) with rents that, on an average per unit 
                or per room basis, exceed the rent of 
                comparable properties in the same market area, 
                determined in accordance with guidelines 
                established by the Secretary;
                    (B) that is covered in whole or in part by 
                a contract for project-based assistance under--
                            (i) the new construction or 
                        substantial rehabilitation program 
                        under section 8(b)(2) of the United 
                        States Housing Act of 1937 (as in 
                        effect before October 1, 1983);
                            (ii) the property disposition 
                        program under section 8(b) of the 
                        United States Housing Act of 1937;
                            (iii) the moderate rehabilitation 
                        program under section 8(e)(2) of the 
                        United States Housing Act of 1937;
                            (iv) the loan management assistance 
                        program under section 8 of the United 
                        States Housing Act of 1937;
                            (v) section 23 of the United States 
                        Housing Act of 1937 (as in effect 
                        before January 1, 1975);
                            (vi) the rent supplement program 
                        under section 101 of the Housing and 
                        Urban Development Act of 1965; or
                            (vii) section 8 of the United 
                        States Housing Act of 1937, following 
                        conversion from assistance under 
                        section 101 of the Housing and Urban 
                        Development Act of 1965; and
                    (C) financed by a mortgage insured or held 
                by the Secretary under the National Housing 
                Act.
            (3) Expiring contract.--The term ``expiring 
        contract'' means a project-based assistance contract 
        attached to an eligible multifamily housing project 
        which, under the terms of the contract, will expire.
            (4) Expiration date.--The term ``expiration date'' 
        means the date on which an expiring contract expires.
            (5) Fair market rent.--The term ``fair market 
        rent'' means the fair market rental established under 
        section 8(c) of the United States Housing Act of 1937.
            (6) Low-income families.--The term ``low-income 
        families'' has the same meaning as provided under 
        section 3(b)(2) of the United States Housing Act of 
        1937.
            (7) Mortgage restructuring and rental assistance 
        sufficiency plan.--The term ``mortgage restructuring 
        and rental assistance sufficiency plan'' means the plan 
        as provided under section 514.
            (8) Nonprofit organization.--The term ``nonprofit 
        organization'' means any private non-profit 
        organization that--
                    (A) is organized under State or local laws;
                    (B) has no part of its net earnings inuring 
                to the benefit of any member, founder, 
                contributor, or individual; and
                    (C) has a long-term record of service in 
                providing or financing quality affordable 
                housing for low-income families through 
                relationships with public entities.
            (9) Portfolio restructuring agreement.--The term 
        ``Portfolio restructuring agreement'' means the 
        agreement entered into between the Secretary and a 
        participating administrative entity, as provided under 
        section 513.
            (10) Participating administrative entity.--The term 
        ``participating administrative entity'' means a public 
        agency (including a State housing finance agency or a 
        local housing agency), a nonprofit organization, or any 
        other entity (including a law firm or an accounting 
        firm) or a combination of such entities, that meets the 
        requirements under section 513(b).
            (11) Project-based assistance.--The term ``project-
        based assistance'' means rental assistance described in 
        paragraph (2)(B) of this section that is attached to a 
        multifamily housing project.
            (12) Renewal.--The term ``renewal'' means the 
        replacement of an expiring Federal rental contract with 
        a new contract under section 8 of the United States 
        Housing Act of 1937, consistent with the requirements 
        of this subtitle.
            (13) Secretary.--The term ``Secretary'' means the 
        Secretary of Housing and Urban Development.
            (14) State.--The term ``State'' has the same 
        meaning as in section 104 of the Cranston-Gonzalez 
        National Affordable Housing Act.
            (15) Tenant-based assistance.--The term ``tenant-
        based assistance'' has the same meaning as in section 
        8(f) of the United States Housing Act of 1937.
            (16) Unit of general local government.--The term 
        ``unit of general local government'' has the same 
        meaning as in section 104 of the Cranston-Gonzalez 
        National Affordable Housing Act.
            (17) Very low-income family.--The term ``very low-
        income family'' has the same meaning as in section 3(b) 
        of the United States Housing Act of 1937.
            (18) Qualified mortgagee.--The term ``qualified 
        mortgagee'' means an entity approved by the Secretary 
        that is capable of servicing, as well as originating, 
        FHA-insured mortgages, and that--
                    (A) is not suspended or debarred by the 
                Secretary;
                    (B) is not suspended or on probation 
                imposed by the Mortgagee Review Board; and
                    (C) is not in default under any Government 
                National Mortgage Association obligation.

SEC. 513. AUTHORITY OF PARTICIPATING ADMINISTRATIVE ENTITIES.

    (a) Participating Administrative Entities.--
            (1) In general.--Subject to subsection (b)(3), the 
        Secretary shall enter into portfolio restructuring 
        agreements with participating administrative entities 
        for the implementation of mortgage restructuring and 
        rental assistance sufficiency plans to restructure 
        multifamily housing mortgages insured or held by the 
        Secretary under the National Housing Act, in order to--
                    (A) reduce the costs of expiring contracts 
                for assistance under section 8 of the United 
                States Housing Act of 1937;
                    (B) address financially and physically 
                troubled projects; and
                    (C) correct management and ownership 
                deficiencies.
            (2) Portfolio restructuring agreements.--Each 
        portfolio restructuring agreement entered into under 
        this subsection shall--
                    (A) be a cooperative agreement to establish 
                the obligations and requirements between the 
                Secretary and the participating administrative 
                entity;
                    (B) identify the eligible multifamily 
                housing projects or groups of projects for 
                which the participating administrative entity 
                is responsible for assisting in developing and 
                implementing approved mortgage restructuring 
                and rental assistance sufficiency plans under 
                section 514;
                    (C) require the participating 
                administrative entity to review and certify to 
                the accuracy and completeness of the evaluation 
                of rehabilitation needs required under section 
                514(e)(3) for each eligible multifamily housing 
                project included in the portfolio restructuring 
                agreement, in accordance with regulations 
                promulgated by the Secretary;
                    (D) identify the responsibilities of both 
                the participating administrative entity and the 
                Secretary in implementing a mortgage 
                restructuring and rental assistance sufficiency 
                plan, including any actions proposed to be 
                taken under section 516 or 517;
                    (E) require each mortgage restructuring and 
                rental assistance sufficiency plan to be 
                prepared in accordance with the requirements of 
                section 514 for each eligible multifamily 
                housing project;
                    (F) include other requirements established 
                by the Secretary, including a right of the 
                Secretary to terminate the contract immediately 
                for failure of the participating administrative 
                entity to comply with any applicable 
                requirement;
                    (G) if the participating administrative 
                entity is a State housing finance agency or a 
                local housing agency, indemnify the 
                participating administrative entity against 
                lawsuits and penalties for actions taken 
                pursuant to the agreement, excluding actions 
                involving willful misconduct or negligence;
                    (H) include compensation for all reasonable 
                expenses incurred by the participating 
                administrative entity necessary to perform its 
                duties under this subtitle; and
                    (I) include, where appropriate, incentive 
                agreements with the participating 
                administrative entity to reward superior 
                performance in meeting the purposes of this 
                Act.
    (b) Selection of Participating Administrative Entity.--
            (1) Selection criteria.--The Secretary shall select 
        a participating administrative entity based on whether, 
        in the determination of the Secretary, the 
        participating administrative entity--
                    (A) has demonstrated experience in working 
                directly with residents of low-income housing 
                projects and with tenants and other community-
                based organizations;
                    (B) has demonstrated experience with and 
                capacity for multifamily restructuring and 
                multifamily financing (which may include risk-
                sharing arrangements and restructuring eligible 
                multifamily housing properties under the fiscal 
                year 1997 Federal Housing Administration 
                multifamily housing demonstration program);
                    (C) has a history of stable, financially 
                sound, and responsible administrative 
                performance (which may include the management 
                of affordable low-income rental housing);
                    (D) has demonstrated financial strength in 
                terms of asset quality, capital adequacy, and 
                liquidity;
                    (E) has demonstrated that it will carry out 
                the specific transactions and other 
                responsibilities under this part in a timely, 
                efficient, and cost-effective manner; and
                    (F) meets other criteria, as determined by 
                the Secretary.
            (2) Selection.--If more than 1 interested entity 
        meets the qualifications and selection criteria for a 
        participating administrative entity, the Secretary may 
        select the entity that demonstrates, as determined by 
        the Secretary, that it will--
                    (A) provide the most timely, efficient, and 
                cost-effective--
                            (i) restructuring of the mortgages 
                        covered by the portfolio restructuring 
                        agreement; and
                            (ii) administration of the section 
                        8 project-based assistance contract, if 
                        applicable; and
                    (B) protect the public interest (including 
                the long-term provision of decent low-income 
                affordable rental housing and protection of 
                residents, communities, and the American 
                taxpayer).
            (3) Partnerships.--For the purposes of any 
        participating administrative entity applying under this 
        subsection, participating administrative entities are 
        encouraged to develop partnerships with each other and 
        with nonprofit organizations, if such partnerships will 
        further the participating administrative entity's 
        ability to meet the purposes of this Act.
            (4) Alternative administrators.--With respect to 
        any eligible multifamily housing project for which a 
        participating administrative entity is unavailable, or 
        should not be selected to carry out the requirements of 
        this subtitle with respect to that multifamily housing 
        project for reasons relating to the selection criteria 
        under paragraph (1), the Secretary shall--
                    (A) carry out the requirements of this 
                subtitle with respect to that eligible 
                multifamily housing project; or
                    (B) contract with other qualified entities 
                that meet the requirements of paragraph (1) to 
                provide the authority to carry out all or a 
                portion of the requirements of this subtitle 
                with respect to that eligible multifamily 
                housing project.
            (5) Priority for public agencies as participating 
        administrative entities.--The Secretary shall provide a 
        reasonable period during which the Secretary will 
        consider proposals only from State housing finance 
        agencies or local housing agencies, and the Secretary 
        shall select such an agency without considering other 
        applicants if the Secretary determines that the agency 
        is qualified. The period shall be of sufficient 
        duration for the Secretary to determine whether any 
        State housing financing agencies or local housing 
        agencies are interested and qualified. Not later than 
        the end of the period, the Secretary shall notify the 
        State housing finance agency or the local housing 
        agency regarding the status of the proposal and, if the 
        proposal is rejected, the reasons for the rejection and 
        an opportunity for the applicant to respond.
            (6) State and local portfolio requirements.--
                    (A) In general.--If the housing finance 
                agency of a State is selected as the 
                participating administrative entity, that 
                agency shall be responsible for such eligible 
                multifamily housing projects in that State as 
                may be agreed upon by the participating 
                administrative entity and the Secretary. If a 
                local housing agency is selected as the 
                participating administrative entity, that 
                agency shall be responsible for such eligible 
                multifamily housing projects in the 
                jurisdiction of the agency as may be agreed 
                upon by the participating administrative entity 
                and the Secretary.
                    (B) Nondelegation.--Except with the prior 
                approval of the Secretary, a participating 
                administrative entity may not delegate or 
                transfer responsibilities and functions under 
                this subtitle to 1 or more entities.
            (7) Private entity requirements.--
                    (A) In general.--If a for-profit entity is 
                selected as the participating administrative 
                entity, that entity shall be required to enter 
                into a partnership with a public purpose entity 
                (including the Department).
                    (B) Prohibition.--No private entity shall 
                share, participate in, or otherwise benefit 
                from any equity created, received, or 
                restructured as a result of the portfolio 
                restructuring agreement.

SEC. 514. MORTGAGE RESTRUCTURING AND RENTAL ASSISTANCE SUFFICIENCY 
                    PLAN.

    (a) In General.--
            (1) Development of procedures and requirements.--
        The Secretary shall develop procedures and requirements 
        for the submission of a mortgage restructuring and 
        rental assistance sufficiency plan for each eligible 
        multifamily housing project with an expiring contract.
            (2) Terms and conditions.--Each mortgage 
        restructuring and rental assistance sufficiency plan 
        submitted under this subsection shall be developed by 
        the participating administrative entity, in cooperation 
        with an owner of an eligible multifamily housing 
        project and any servicer for the mortgage that is a 
        qualified mortgagee, under such terms and conditions as 
        the Secretary shall require.
            (3) Consolidation.--Mortgage restructuring and 
        rental assistance sufficiency plans submitted under 
        this subsection may be consolidated as part of an 
        overall strategy for more than 1 property.
    (b) Notice Requirements.--The Secretary shall establish 
notice procedures and hearing requirements for tenants and 
owners concerning the dates for the expiration of project-based 
assistance contracts for any eligible multifamily housing 
project.
    (c) Extension of Contract Term.--Subject to agreement by a 
project owner, the Secretary may extend the term of any 
expiring contract or provide a section 8 contract with rent 
levels set in accordance with subsection (g) for a period 
sufficient to facilitate the implementation of a mortgage 
restructuring and rental assistance sufficiency plan, as 
determined by the Secretary.
    (d) Tenant Rent Protection.--If the owner of a project with 
an expiring Federal rental assistance contract does not agree 
to extend the contract, not less than 12 months prior to 
terminating the contract, the project owner shall provide 
written notice to the Secretary and the tenants and the 
Secretary shall make tenant-based assistance available to 
tenants residing in units assisted under the expiring contract 
at the time of expiration.
    (e) Mortgage Restructuring and Rental Assistance 
Sufficiency Plan.--Each mortgage restructuring and rental 
assistance sufficiency plan shall--
            (1) except as otherwise provided, restructure the 
        project-based assistance rents for the eligible 
        multifamily housing project in a manner consistent with 
        subsection (g), or provide for tenant-based assistance 
        in accordance with section 515;
            (2) allow for rent adjustments by applying an 
        operating cost adjustment factor established under 
        guidelines established by the Secretary;
            (3) require the owner or purchaser of an eligible 
        multifamily housing project to evaluate the 
        rehabilitation needs of the project, in accordance with 
        regulations of the Secretary, and notify the 
        participating administrative entity of the 
        rehabilitation needs;
            (4) require the owner or purchaser of the project 
        to provide or contract for competent management of the 
        project;
            (5) require the owner or purchaser of the project 
        to take such actions as may be necessary to 
        rehabilitate, maintain adequate reserves, and to 
        maintain the project in decent and safe condition, 
        based on housing quality standards established by--
                    (A) the Secretary; or
                    (B) local housing codes or codes adopted by 
                public housing agencies that--
                            (i) meet or exceed housing quality 
                        standards established by the Secretary; 
                        and
                            (ii) do not severely restrict 
                        housing choice;
            (6) require the owner or purchaser of the project 
        to maintain affordability and use restrictions in 
        accordance with regulations promulgated by the 
        Secretary, for a term of not less than 30 years which 
        restrictions shall be--
                    (A) contained in a legally enforceable 
                document recorded in the appropriate records; 
                and
                    (B) consistent with the long-term physical 
                and financial viability and character of the 
                project as affordable housing;
            (7) include a certification by the participating 
        administrative entity that the restructuring meets 
        subsidy layering requirements established by the 
        Secretary by regulation for purposes of this subtitle;
            (8) require the owner or purchaser of the project 
        to meet such other requirements as the Secretary 
        determines to be appropriate; and
            (9) prohibit the owner from refusing to lease a 
        reasonable number of units to holders of certificates 
        and vouchers under section 8 of the United States 
        Housing Act of 1937 because of the status of the 
        prospective tenants as certificate and voucher holders.
    (f) Tenant and Other Participation and Capacity Building.--
            (1) Procedures.--
                    (A) In general.--The Secretary shall 
                establish procedures to provide an opportunity 
                for tenants of the project, residents of the 
                neighborhood, the local government, and other 
                affected parties to participate effectively and 
                on a timely basis in the restructuring process 
                established by this subtitle.
                    (B) Coverage.--These procedures shall take 
                into account the need to provide tenants of the 
                project, residents of the neighborhood, the 
                local government, and other affected parties 
                timely notice of proposed restructuring actions 
                and appropriate access to relevant information 
                about restructuring activities. To the extent 
                practicable and consistent with the need to 
                accomplish project restructuring in an 
                efficient manner, the procedures shall give all 
                such parties an opportunity to provide comments 
                to the participating administrative entity in 
                writing, in meetings, or in another appropriate 
                manner (which comments shall be taken into 
                consideration by the participating 
                administrative entity).
            (2) Required consultation.--The procedures 
        developed pursuant to paragraph (1) shall require 
        consultation with tenants of the project, residents of 
        the neighborhood, the local government, and other 
        affected parties, in connection with at least the 
        following:
                    (A) the mortgage restructuring and rental 
                assistance sufficiency plan;
                    (B) any proposed transfer of the project; 
                and
                    (C) the rental assistance assessment plan 
                pursuant to section 515(c).
            (3) Funding.--
                    (A) In general.--The Secretary may provide 
                not more than $10,000,000 annually in funding 
                from which the Secretary may make obligations 
                to tenant groups, nonprofit organizations, and 
                public entities for building the capacity of 
                tenant organizations, for technical assistance 
                in furthering any of the purposes of this 
                subtitle (including transfer of developments to 
                new owners) and for tenant services, from those 
                amounts made available under appropriations 
                Acts for implementing this subtitle or 
                previously made available for technical 
                assistance in connection with the preservation 
                of affordable rental housing for low-income 
                persons.
                    (B) Manner of providing.--Notwithstanding 
                any other provision of law restricting the use 
                of preservation technical assistance funds, the 
                Secretary may provide any funds made available 
                under subparagraph (A) through existing 
                technical assistance programs pursuant to any 
                other Federal law, including the Low-Income 
                Housing Preservation and Resident Homeownership 
                Act of 1990 and the Multifamily Property 
                Disposition Reform Act of 1994, or through any 
                other means that the Secretary considers 
                consistent with the purposes of this subtitle, 
                without regard to any set-aside requirement 
                otherwise applicable to those funds.
                    (C) Prohibition.--None of the funds made 
                available under subparagraph (A) may be used 
                directly or indirectly to pay for any personal 
                service, advertisement, telegram, telephone, 
                letter, printed or written matter, or other 
                device, intended or designed to influence in 
                any manner a Member of Congress, to favor or 
                oppose, by vote or otherwise, any legislation 
                or appropriation by Congress, whether before or 
                after the introduction of any bill or 
                resolution proposing such legislation or 
                appropriation.
    (g) Rent Levels.--
            (1) In general.--Except as provided in paragraph 
        (2), each mortgage restructuring and rental assistance 
        sufficiency plan pursuant to the terms, conditions, and 
        requirements of this subtitle shall establish for units 
        assisted with project-based assistance in eligible 
        multifamily housing projects adjusted rent levels 
        that--
                    (A) are equivalent to rents derived from 
                comparable properties, if--
                            (i) the participating 
                        administrative entity makes the rent 
                        determination within a reasonable 
                        period of time; and
                            (ii) the market rent determination 
                        is based on not less than 2 comparable 
                        properties; or
                    (B) if those rents cannot be determined, 
                are equal to 90 percent of the fair market 
                rents for the relevant market area.
            (2) Exceptions.--
                    (A) In general.--A contract under this 
                section may include rent levels that exceed the 
                rent level described in paragraph (1) at rent 
                levels that do not exceed 120 percent of the 
                fair market rent for the market area (except 
                that the Secretary may waive this limit for not 
                more than five percent of all units subject to 
                restructured mortgages in any fiscal year, 
                based on a finding of special need), if the 
                participating administrative entity--
                            (i) determines that the housing 
                        needs of the tenants and the community 
                        cannot be adequately addressed through 
                        implementation of the rent limitation 
                        required to be established through a 
                        mortgage restructuring and rental 
                        assistance sufficiency plan under 
                        paragraph (1); and
                            (ii) follows the procedures under 
                        paragraph (3).
                    (B) Exception rents.--In any fiscal year, a 
                participating administrative entity may approve 
                exception rents on not more than 20 percent of 
                all units covered by the portfolio 
                restructuring agreement with expiring contracts 
                in that fiscal year, except that the Secretary 
                may waive this ceiling upon a finding of 
                special need.
            (3) Rent levels for exception projects.--For 
        purposes of this section, a project eligible for an 
        exception rent shall receive a rent calculated based on 
        the actual and projected costs of operating the 
        project, at a level that provides income sufficient to 
        support a budget-based rent that consists of--
                    (A) the debt service of the project;
                    (B) the operating expenses of the project, 
                as determined by the participating 
                administrative entity, including--
                            (i) contributions to adequate 
                        reserves;
                            (ii) the costs of maintenance and 
                        necessary rehabilitation; and
                            (iii) other eligible costs 
                        permitted under section 8 of the United 
                        States Housing Act of 1937;
                    (C) an adequate allowance for potential 
                operating losses due to vacancies and failure 
                to collect rents, as determined by the 
                participating administrative entity;
                    (D) an allowance for a reasonable rate of 
                return to the owner or purchaser of the 
                project, as determined by the participating 
                administrative entity, which may be established 
                to provide incentives for owners or purchasers 
                to meet benchmarks of quality for management 
                and housing quality; and
                    (E) other expenses determined by the 
                participating administrative entity to be 
                necessary for the operation of the project.
    (h) Exemptions From Restructuring.--The following 
categories of projects shall not be covered by a mortgage 
restructuring and rental assistance sufficiency plan if--
            (1) the primary financing or mortgage insurance for 
        the multifamily housing project that is covered by that 
        expiring contract was provided by a unit of State 
        government or a unit of general local government (or an 
        agency or instrumentality of a unit of a State 
        government or unit of general local government);
            (2) the project is a project financed under section 
        202 of the Housing Act of 1959 or section 515 of the 
        Housing Act of 1949; or
            (3) the project has an expiring contract under 
        section 8 of the United States Housing Act of 1937 
        entered into pursuant to section 441 of the Stewart B. 
        McKinney Homeless Assistance Act.

SEC. 515. SECTION 8 RENEWALS AND LONG-TERM AFFORDABILITY COMMITMENT BY 
                    OWNER OF PROJECT.

    (a) Section 8 Renewals of Restructured Projects.--
            (1) Project-based assistance.--Subject to the 
        availability of amounts provided in advance in 
        appropriations Acts, and to the control of the 
        Secretary of applicable accounts in the Treasury of the 
        United States, with respect to an expiring section 8 
        contract on an eligible multifamily housing project to 
        be renewed with project-based assistance (based on a 
        determination under subsection (c)), the Secretary 
        shall enter into contracts with participating 
        administrative entities pursuant to which the 
        participating administrative entity shall offer to 
        renew or extend the contract, or the Secretary shall 
        offer to renew such contract, and the owner of the 
        project shall accept the offer, if the initial renewal 
        is in accordance with the terms and conditions 
        specified in the mortgage restructuring and rental 
        assistance sufficiency plan and the rental assistance 
        assessment plan.
            (2) Tenant-based assistance.--Subject to the 
        availability of amounts provided in advance in 
        appropriations Acts and to the control of the Secretary 
        of applicable accounts in the Treasury of the United 
        States, with respect to an expiring section 8 contract 
        on an eligible multifamily housing project to be 
        renewed with tenant-based assistance (based on a 
        determination under subsection (c)), the Secretary 
        shall enter into contracts with participating 
        administrative entities pursuant to which the 
        participating administrative entity shall provide for 
        the renewal of section 8 assistance on an eligible 
        multifamily housing project with tenant-based 
        assistance, or the Secretary shall provide for such 
        renewal, in accordance with the terms and conditions 
        specified in the mortgage restructuring and rental 
        assistance sufficiency plan and the rental assistance 
        assessment plan.
    (b) Required Commitment.--After the initial renewal of a 
section 8 contract pursuant to this section, the owner shall 
accept each offer made pursuant to subsection(a) to renew the 
contract, for the term of the affordability and use restrictions 
required by section 514(e)(6), if the offer to renew is on terms and 
conditions specified in the mortgage restructuring and rental 
assistance sufficiency plan.
    (c) Determination of Whether To Renew With Project-Based or 
Tenant-Based Assistance.--
            (1) Mandatory renewal of project-based 
        assistance.--Section 8 assistance shall be renewed with 
        project-based assistance, if--
                    (A) the project is located in an area in 
                which the participating administrative entity 
                determines, based on housing market indicators, 
                such as low vacancy rates or high absorption 
                rates, that there is not adequate available and 
                affordable housing or that the tenants of the 
                project would not be able to locate suitable 
                units or use the tenant-based assistance 
                successfully;
                    (B) a predominant number of the units in 
                the project are occupied by elderly families, 
                disabled families, or elderly and disabled 
                families;
                    (C) the project is held by a nonprofit 
                cooperative ownership housing corporation or 
                nonprofit cooperative housing trust.
            (2) Rental assistance assessment plan.--
                    (A) In general.--With respect to any 
                project that is not described in paragraph (1), 
                the participating administrative entity shall, 
                after consultation with the owner of the 
                project, develop a rental assistance assessment 
                plan to determine whether to renew assistance 
                for the project with tenant-based assistance or 
                project-based assistance.
                    (B) Rental assistance assessment plan 
                requirements.--Each rental assistance 
                assessment plan developed under this paragraph 
                shall include an assessment of the impact of 
                converting to tenant-based assistance and the 
                impact of extending project-based assistance 
                on--
                            (i) the ability of the tenants to 
                        find adequate, available, decent, 
                        comparable, and affordable housing in 
                        the local market;
                            (ii) the types of tenants residing 
                        in the project (such as elderly 
                        families, disabled families, large 
                        families, and cooperative homeowners);
                            (iii) the local housing needs 
                        identified in the comprehensive housing 
                        affordability strategy, and local 
                        market vacancy trends;
                            (iv) the cost of providing 
                        assistance, comparing the applicable 
                        payment standard to the project's 
                        adjusted rent levels determined under 
                        section 514(g);
                            (v) the long-term financial 
                        stability of the project;
                            (vi) the ability of residents to 
                        make reasonable choices about their 
                        individual living situations;
                            (vii) the quality of the 
                        neighborhood in which the tenants would 
                        reside; and
                            (viii) the project's ability to 
                        compete in the marketplace.
                    (C) Reports to director.--Each 
                participating administrative entity shall 
                report regularly to the Director as defined in 
                subtitle D, as the Director shall require, 
                identifying--
                            (i) each eligible multifamily 
                        housing project for which the entity 
                        has developed a rental assistance 
                        assessment plan under this paragraph 
                        that determined that the tenants of the 
                        project generally supported renewal of 
                        assistance with tenant-based 
                        assistance, but under which assistance 
                        for the project was renewed with 
                        project-based assistance; and
                            (ii) each project for which the 
                        entity has developed such a plan under 
                        which the assistance is renewed using 
                        tenant-based assistance.
            (3) Eligibility for tenant-based assistance.--
        Subject to paragraph (4), with respect to any project 
        that is not described in paragraph (1), if a 
        participating administrative entity approves the use of 
        tenant-based assistance based on a rental assistance 
        assessment plan developed under paragraph (2), tenant-
        based assistance shall be provided to each assisted 
        family (other than a family already receiving tenant-
        based assistance) residing in the project at the time 
        the assistance described in section 512(2)(B) 
        terminates.
            (4) Rents for families receiving tenant-based 
        assistance.--
                    (A) In general.--Notwithstanding subsection 
                (c)(1) or (o)(1) of section 8 of the United 
                States Housing Act of 1937, in the case of any 
                family described in paragraph (3) that resides 
                in a project described in section 512(2)(B) in 
                which the reasonable rent (which rent shall 
                include any amount allowed for utilities and 
                shall not exceed comparable market rents for 
                the relevant housing market area) exceeds the 
                fair market rent limitation or the payment 
                standard, as applicable, the amount of 
                assistance for the family shall be determined 
                in accordance with subparagraph (B).
                    (B) Maximum monthly rent; payment 
                standard.--With respect to the certificate 
                program under section 8(b) of the United States 
                Housing Act of 1937, the maximum monthly rent 
                under the contract (plus any amount allowed for 
                utilities) shall be such reasonable rent for 
                the unit. With respect to the voucher program 
                under section 8(o) of the United States Housing 
                Act of 1937, the payment standard shall be 
                deemed to be such reasonable rent for the unit.
            (5) Inapplicability of certain provision.--If a 
        participating administrative entity approves renewal 
        with project-based assistance under this subsection, 
        section 8(d)(2) of the United States Housing Act of 
        1937 shall not apply.

SEC. 516. PROHIBITION ON RESTRUCTURING.

    (a) Prohibition on Restructuring.--The Secretary may elect 
not to consider any mortgage restructuring and rental 
assistance sufficiency plan or request for contract renewal if 
the Secretary or the participating administrative entity 
determines that--
            (1)(A) the owner or purchaser of the project has 
        engaged in material adverse financial or managerial 
        actions or omissions with regard to such project; or
            (B) the owner or purchaser of the project has 
        engaged in material adverse financial or managerial 
        actions or omissions with regard to other projects of 
        such owner or purchaser that are federally-assisted or 
        financed with a loan from, or mortgage insured or 
        guaranteed by, an agency of the Federal government.
            (2) Material adverse financial or managerial 
        actions or omissions include--
                    (A) materially violating any Federal, 
                State, or local law or regulation with regard 
                to this project or any other federally assisted 
                project, after receipt of notice and an 
                opportunity to cure;
                    (B) materially breaching a contract for 
                assistance under section 8 of the United States 
                Housing Act of 1937, after receipt of notice 
                and an opportunity to cure;
                    (C) materially violating any applicable 
                regulatory or other agreement with the 
                Secretary or a participating administrative 
                entity, after receipt of notice and an 
                opportunity to cure;
                    (D) repeatedly and materially violating any 
                Federal, State, or local law or regulation with 
                regard to the project or any other federally 
                assisted project;
                    (E) repeatedly and materially breaching a 
                contract for assistance under section 8 of the 
                United States Housing Act of 1937;
                    (F) repeatedly and materially violating any 
                applicable regulatory or other agreement with 
                the Secretary or a participating administrative 
                entity;
                    (G) repeatedly failing to make mortgage 
                payments at times when project income was 
                sufficient to maintain and operate the 
                property;
                    (H) materially failing to maintain the 
                property according to housing quality standards 
                after receipt of notice and a reasonable 
                opportunity to cure; or
                    (I) committing any actions or omissions 
                that would warrant suspension or debarment by 
                the Secretary;
            (3) the owner or purchaser of the property 
        materially failed to follow the procedures and 
        requirements of this part, after receipt of notice and 
        an opportunity to cure; or
            (4) the poor condition of the project cannot be 
        remedied in a cost effective manner, as determined by 
        the participating administrative entity.
The term ``owner'' as used in this subsection, in addition to 
it having the same meaning as in section 8(f) of the United 
States Housing Act of 1937, also means an affiliate of the 
owner. The term ``purchaser'' as used in this subsection means 
any private person or entity, including a cooperative, an 
agency of the Federal Government, or a public housing agency, 
that, upon purchase of the project, would have the legal right 
to lease or sublease dwelling units in the project, and also 
means an affiliate of the purchaser. The terms ``affiliate of 
the owner'' and ``affiliate of the purchaser'' means any person 
or entity (including, but not limited to, a general partner or 
managing member, or an officer of either) that controls an 
owner or purchaser, is controlled by an owner or purchaser, or 
is under common control with the owner or purchaser. The term 
``control'' means the direct or indirect power (under contract, 
equity ownership, the right to vote or determine a vote, or 
otherwise) to direct the financial legal, beneficial or other 
interests of the owner or purchaser.
    (b) Opportunity To Dispute Findings.--
            (1) In general.--During the 30-day period beginning 
        on the date on which the owner or purchaser of an 
        eligible multifamily housing project receives notice of 
        a rejection under subsection (a) or of a mortgage 
        restructuring and rental assistance sufficiency plan 
        under section 514, the Secretary or participating 
        administrative entity shall provide that owner or 
        purchaser with an opportunity to dispute the basis for 
        the rejection and an opportunity to cure.
            (2) Affirmation, modification, or reversal.--
                    (A) In general.--After providing an 
                opportunity to dispute under paragraph (1), the 
                Secretary or the participating administrative 
                entity may affirm, modify, or reverse any 
                rejection under subsection (a) or rejection of 
                a mortgage restructuring and rental assistance 
                sufficiency plan under section 514.
                    (B) Reasons for decision.--The Secretary or 
                the participating administrative entity, as 
                applicable, shall identify the reasons for any 
                final decision under this paragraph.
                    (C) Review process.--The Secretary shall 
                establish an administrative review process to 
                appeal any final decision under this paragraph.
    (c) Final Determination.--Any final determination under 
this section shall not be subject to judicial review.
    (d) Displaced Tenants.--Subject to the availability of 
amounts provided in advance in appropriations Acts, for any 
low-income tenant that is residing in a project or receiving 
assistance under section 8 of the United States Housing Act of 
1937 at the time of rejection under this section, that tenant 
shall be provided with tenant-based assistance and reasonable 
moving expenses, as determined by the Secretary.
    (e) Transfer of Property.--For properties disqualified from 
the consideration of a mortgage restructuring and rental 
assistance sufficiency plan under this section in accordance 
with paragraph (1) or (2) of subsection (a) because of actions 
by an owner or purchaser, the Secretary shall establish 
procedures to facilitate the voluntary sale or transfer of a 
property as part of a mortgage restructuring and rental 
assistance sufficiency plan, with a preference for tenant 
organizations and tenant-endorsed community-based nonprofit and 
public agency purchasers meeting such reasonable qualifications 
as may be established by the Secretary.

SEC. 517. RESTRUCTURING TOOLS.

    (a) Mortgage Restructuring.--
            (1) In this part, an approved mortgage 
        restructuring and rental assistance sufficiency plan 
        shall include restructuring mortgages in accordance 
        with this subsection to provide--
                    (A) a restructured or new first mortgage 
                that is sustainable at rents at levels that are 
                established in section 514(g); and
                    (B) a second mortgage that is in an amount 
                equal to no more than the difference between 
                the restructured or new first mortgage and the 
                indebtedness under the existing insured 
                mortgage immediately before it is restructured 
                or refinanced, provided that the amount of the 
                second mortgage shall be in an amount that the 
                Secretary or participating administrative 
                entity determines can reasonably be expected to 
                be repaid.
            (2) The second mortgage shall bear interest at a 
        rate not to exceed the applicable Federal rate as 
        defined in section 1274(d) of the Internal Revenue Code 
        of 1986. The term of the second mortgage shall be equal 
        to the term of the restructured or new first mortgage.
            (3) Payments on the second mortgage shall be 
        deferred when the first mortgage remains outstanding, 
        except to the extent there is excess project income 
        remaining after payment of all reasonable and necessary 
        operating expenses (including deposits in a reserve for 
        replacement), debt service on the first mortgage, and 
        any other expenditures approved by the Secretary. At 
        least 75 percent of any excess project income shall be 
        applied to payments on thesecond mortgage, and the 
Secretary or the participating administrative entity may permit up to 
25 percent to be paid to the project owner if the Secretary or 
participating administrative entity determines that the project owner 
meets benchmarks for management and housing quality.
            (4) The full amount of the second mortgage shall be 
        immediately due and payable if--
                    (A) the first mortgage is terminated or 
                paid in full, except as otherwise provided by 
                the holder of the second mortgage;
                    (B) the project is purchased and the second 
                mortgage is assumed by any subsequent purchaser 
                in violation of guidelines established by the 
                Secretary; or
                    (C) the Secretary provides notice to the 
                project owner that such owner has failed to 
                materially comply with any requirements of this 
                section or the United States Housing Act of 
                1937 as those requirements apply to the 
                project, with a reasonable opportunity for such 
                owner to cure such failure.
            (5) The Secretary may modify the terms or forgive 
        all or part of the second mortgage if the Secretary 
        holds the second mortgage and if the project is 
        acquired by a tenant organization or tenant-endorsed 
        community-based nonprofit or public agency, pursuant to 
        guidelines established by the Secretary.
    (b) Restructuring Tools.--In addition to the requirements 
of subsection (a) and to the extent these actions are 
consistent with this section and with the control of the 
Secretary of applicable accounts in the Treasury of the United 
States, an approved mortgage restructuring and rental 
assistance sufficiency plan under this subtitle may include 1 
or more of the following actions:
            (1) Full or partial payment of claim.--Making a 
        full payment of claim or partial payment of claim under 
        section 541(b) of the National Housing Act, as amended 
        by section 523(b) of this Act. Any payment under this 
        paragraph shall not require the approval of a 
        mortgagee.
            (2) Refinancing of debt.--Refinancing of all or 
        part of the debt on a project. If the refinancing 
        involves a mortgage that will continue to be insured 
        under the National Housing Act, the refinancing shall 
        be documented through amendment of the existing 
        insurance contract and not through a new insurance 
        contract.
            (3) Mortgage insurance.--Providing FHA multifamily 
        mortgage insurance, reinsurance orother credit 
enhancement alternatives, including multifamily risk-sharing mortgage 
programs, as provided under section 542 of the Housing and Community 
Development Act of 1992. Any limitations on the number of units 
available for mortgage insurance under section 542 shall not apply to 
eligible multifamily housing projects. Any credit subsidy costs of 
providing mortgage insurance shall be paid from the Liquidating Account 
of the General Insurance Fund or the Special Risk Insurance Fund and 
shall not be subject to any limitation on appropriations.
            (4) Credit enhancement.--Any additional State or 
        local mortgage credit enhancements and risk-sharing 
        arrangements may be established with State or local 
        housing finance agencies, the Federal Housing Finance 
        Board, the Federal National Mortgage Association, and 
        the Federal Home Loan Mortgage Corporation, to a 
        modified or refinanced first mortgage.
            (5) Compensation of third parties.--Consistent with 
        the portfolio restructuring agreement, entering into 
        agreements, incurring costs, or making payments, 
        including incentive agreements designed to reward 
        superior performance in meeting the purposes of this 
        Act, as may be reasonably necessary, to compensate the 
        participation of participating administrative entities 
        and other parties in undertaking actions authorized by 
        this subtitle. Upon request to the Secretary, 
        participating administrative entities that are 
        qualified under the United States Housing Act of 1937 
        to serve as contract administrators shall be the 
        contract administrators under section 8 of the United 
        States Housing Act of 1937 for purposes of any 
        contracts entered into as part of anapproved mortgage 
restructuring and rental assistance sufficiency plan. Subject to the 
availability of amounts provided in advance in appropriations Acts for 
administrative fees under section 8 of the United States Housing Act of 
1937, such amounts may be used to compensate participating 
administrative entities for compliance monitoring costs incurred under 
section 519.
            (6) Use of project accounts.--Applying any residual 
        receipts, replacement reserves, and any other project 
        accounts not required for project operations, to 
        maintain the long-term affordability and physical 
        condition of the property or of other eligible 
        multifamily housing projects. The participating 
        administrative entity may expedite the acquisition of 
        residual receipts, replacement reserves, or other such 
        accounts, by entering into agreements with owners of 
        housing covered by an expiring contract to provide an 
        owner with a share of the receipts, not to exceed 10 
        percent, in accordance with guidelines established by 
        the Secretary.
            (7) Rehabilitation needs.--
                    (A) In general.--Assisting in addressing 
                the rehabilitation needs of the project. 
                Rehabilitation may be paid from the residual 
                receipts, replacement reserves, or any other 
                project accounts not required for project 
                operations, or, as provided in appropriations 
                Acts and subject to the control of the 
                Secretary of applicable accounts in the 
                Treasury of the United States, from budget 
                authority provided for increases in the budget 
                authority for assistance contracts under 
                section 8 of the United States Housing Act of 
                1937, the rehabilitation grant program 
                established under section 236(s) of the 
                National Housing Act, or through the debt 
                restructuring transaction. Rehabilitation under 
                this paragraph shall only be for the purpose of 
                restoring the project to a non-luxury standard 
                adequate for the rental market intended at the 
                original approval of the project-based 
                assistance.
                    (B) Contribution.--Each owner or purchaser 
                of a project to be rehabilitated under an 
                approved mortgage restructuring and rental 
                assistance sufficiency plan shall contribute, 
                from non-project resources, not less than 25 
                percent of the amount of rehabilitation 
                assistance received, except that the 
                participating administrative entity may provide 
                an exception from the requirement of this 
                subparagraph for housing cooperatives.
    (c) Role of FNMA and FHLMC.--Section 1335 of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4565) is amended--
            (1) in paragraph (3), by striking ``and'' at the 
        end;
            (2) paragraph (4), by striking the period at the 
        end and inserting ``; and'';
            (3) by striking ``To meet'' and inserting the 
        following:
    ``(a) In General.--To meet''; and
            (4) by adding at the end the following:
            ``(5) assist in maintaining the affordability of 
        assisted units in eligible multifamily housing projects 
        with expiring contracts, as defined under the 
        Multifamily Assisted Housing Reform and Affordability 
        Act of 1997.
    ``(b) Affordable Housing Goals.--Actions taken under 
subsection (a)(5) shall constitute part of the contribution of 
each entity in meeting its affordable housing goals under 
sections 1332, 1333, and 1334 for any fiscal year, as 
determined by the Secretary.''.
    (d) Prohibition on Equity Sharing by the Secretary.--The 
Secretary is prohibited from participating in any equity 
agreement or profit-sharing agreement in conjunction with any 
eligible multifamily housing project.
    (e) Conflict of Interest Guidelines.--The Secretary may 
establish guidelines to prevent conflicts of interest by a 
participating administrative entity that provides, directly or 
through risk-sharing arrangements, any form of credit 
enhancement or financing pursuant to subsections (b)(3) or 
(b)(4) or to prevent conflicts of interest by any other person 
or entity under this subtitle.

SEC. 518. MANAGEMENT STANDARDS.

    Each participating administrative entity shall establish 
management standards, including requirements governing 
conflicts of interest between owners, managers, contractors 
with an identity of interest, pursuant to guidelines 
established by the Secretary and consistent with industry 
standards.

SEC. 519. MONITORING OF COMPLIANCE.

    (a) Compliance Agreements.--(1) Pursuant to regulations 
issued by the Secretary under section 522(a), each 
participating administrative entity, through binding 
contractual agreements with owners and otherwise, shall ensure 
long-term compliance with the provisions of this subtitle. Each 
agreement shall, at a minimum, provide for--
            (A) enforcement of the provisions of this subtitle; 
        and
            (B) remedies for the breach of those provisions.
    (2) If the participating administrative entity is not 
qualified under the United States Housing Act of 1937 to be a 
section 8 contract administrator or fails to perform its duties 
under the portfolio restructuring agreement, the Secretary 
shall have the right to enforce the agreement.
    (b) Periodic Monitoring.--
            (1) In general.--Not less than annually, each 
        participating administrative entity that is qualified 
        to be the section 8 contract administrator shall review 
        the status of all multifamily housing projects for 
        which a mortgage restructuring and rental assistance 
        sufficiency plan has been implemented.
            (2) Inspections.--Each review under this subsection 
        shall include onsite inspection to determine compliance 
        with housing codes and other requirements as provided 
        in this subtitle and the portfolio restructuring 
        agreements.
            (3) Administration.--If the participating 
        administrative entity is not qualified under the United 
        States Housing Act of 1937 to be a section 8 contract 
        administrator, either the Secretary or a qualified 
        State or local housing agency shall be responsible for 
        the review required by this subsection.
    (c) Audit by the Secretary.--The Comptroller General of the 
United States, the Secretary, and the Inspector General of the 
Department of Housing and Urban Development may conduct an 
audit at any time of any multifamily housing project for which 
a mortgage restructuring and rental assistance sufficiency plan 
has been implemented.

SEC. 520. REPORTS TO CONGRESS.

    (a) Annual Review.--In order to ensure compliance with this 
subtitle, the Secretary shall conduct an annual review and 
report to the Congress on actions taken under this subtitle and 
the status of eligible multifamily housing projects.
    (b) Semiannual Review.--Not less than semiannually during 
the 2-year period beginning on the date of the enactment of 
this Act and not less than annually thereafter, the Secretary 
shall submit reports to the Committee on Banking and Financial 
Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate stating, for 
such periods, the total number of projects identified by 
participating administrative entities under each of clauses (i) 
and (ii) of subparagraph (C).

SEC. 521. GAO AUDIT AND REVIEW.

    (a) Initial Audit.--Not later than 18 months after the 
effective date of final regulations promulgated under this 
part, the Comptroller General of the United States shall 
conduct an audit to evaluate eligiblemultifamily housing 
projects and the implementation of mortgage restructuring and rental 
assistance sufficiency plans.
    (b) Report.--
            (1) In general.--Not later than 18 months after the 
        audit conducted under subsection (a), the Comptroller 
        General of the United States shall submit to Congress a 
        report on the status of eligible multifamily housing 
        projects and the implementation of mortgage 
        restructuring and rental assistance sufficiency plans.
            (2) Contents.--The report submitted under paragraph 
        (1) shall include--
                    (A) a description of the initial audit 
                conducted under subsection (a); and
                    (B) recommendations for any legislative 
                action to increase the financial savings to the 
                Federal Government of the restructuring of 
                eligible multifamily housing projects balanced 
                with the continued availability of the maximum 
                number of affordable low-income housing units.

SEC. 522. REGULATIONS.

    (a) Rulemaking and Implementation.--
            (1) Interim regulations.--The Director shall issue 
        such interim regulations as may be necessary to 
        implement this subtitle and the amendments made by this 
        subtitle with respect to eligible multifamily housing 
        projects covered by contracts described in section 
        512(2)(B) that expire in fiscal year 1999 or 
        thereafter. If, before the expiration of such period, 
        the Director has not been appointed, the Secretary 
        shall issue such interim regulations.
            (2) Final regulations.--The Director shall issue 
        final regulations necessary to implement this subtitle 
        and the amendments made by this subtitle with respect 
        to eligible multifamily housing projects covered by 
        contracts described in section 512(2)(B) that expire in 
        fiscal year 1999 or thereafter before the later of (A) 
        the expiration of the 12-month period beginning upon 
        the date of the enactment of this Act, and (B) the 3-
        month period beginning upon the appointment of the 
        Director under subtitle B.
            (3) Factors for consideration.--Before the 
        publication of the final regulations under paragraph 
        (2), in addition to public comments invited in 
        connection with publication of the interim rule, the 
        Secretary shall--
                    (A) seek recommendations on the 
                implementation of sections 513(b) and 515(c)(1) 
                from organizations representing--
                            (i) State housing finance agencies 
                        and local housing agencies;
                            (ii) other potential participating 
                        administering entities;
                            (iii) tenants;
                            (iv) owners and managers of 
                        eligible multifamily housing projects;
                            (v) States and units of general 
                        local government; and
                            (vi) qualified mortgagees; and
                    (B) convene not less than 3 public forums 
                at which the organizations making 
                recommendations under subparagraph (A) may 
                express views concerning the proposed 
                disposition of the recommendations.
    (b) Transition Provision for Contracts Expiring in Fiscal 
Year 1998.--Notwithstanding any other provision of law, the 
Secretary shall apply all the terms of section 211 and section 
212 of the Departments of Veterans Affairs and Housing and 
Urban Development, and Independent Agencies Appropriations Act, 
1997 (except for section 212(h)(1)(G) and the limitation in 
section 212(k)) contracts for project-based assistance that 
expire during fiscal year 1998 (in the same manner that such 
provisions apply to expiring contracts defined in section 
212(a)(3) of such Act), except that section 517(a) of the Act 
shall apply to mortgages on projects subject to such contracts.

SEC. 523. TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Calculation of Limit on Project-Based Assistance.--
Section 8(d) of the United States Housing Act of 1937 (42 
U.S.C. 1437f(d)) is amended by adding at the end the following:
            ``(5) Calculation of limit.--Any contract entered 
        into under section 514 of the Multifamily Assisted 
        Housing Reform and Affordability Act of 1997 shall be 
        excluded in computing the limit on project-based 
        assistance under this subsection.''.
    (b) Partial Payment of Claims on Multifamily Housing 
Projects.--Section 541 of the National Housing Act (12 U.S.C. 
1735f-19) is amended--
            (1) in subsection (a), in the subsection heading, 
        by striking ``Authority'' and inserting ``Defaulted 
        Mortgages'';
            (2) by redesignating subsection (b) as subsection 
        (c); and
            (3) by inserting after subsection (a) the 
        following:
    ``(b) Existing Mortgages.--Notwithstanding any other 
provision of law, the Secretary, in connection with a mortgage 
restructuring under section 514 of the Multifamily Assisted 
Housing Reform and Affordability Act of 1997, may make a 1 
time, nondefault partial payment of the claim under the 
mortgage insurance contract, which shall include a 
determination by the Secretary or the participating 
administrative entity, in accordance with the Multifamily 
Assisted Housing Reform and Affordability Act of 1997, of the 
market value of the project and a restructuring of the 
mortgage, under such terms and conditions as are permitted by 
section 517(a) of such Act.''.
    (c) Reuse and Rescission of Certain Recaptured Budget 
Authority.--Section 8(bb) of the United States Housing Act of 
1937 (42 U.S.C. 1437f(bb) is amended--
            (1) by inserting after ``(bb)'' the following: 
        ``Transfer, Reuse, and Rescission of Budget 
        Authority.--(1)''; and
            (2) by inserting the following new paragraph at the 
        end:
    ``(2) Reuse and Rescission of Certain Recaptured Budget 
Authority.--Notwithstanding paragraph (1), if a project-based 
assistance contract for an eligible multifamily housing project 
subject to actions authorized under title I is terminated or 
amended as part of restructuring under section 517 of the 
Multifamily Assisted Housing Reform and Affordability Act of 
1997, the Secretary shall recapture the budget authority not 
required for the terminated or amended contract and use such 
amounts as are necessary to provide housing assistance for the 
same number of families covered by such contract for the 
remaining term of such contract, under a contract providing for 
project-based or tenant-based assistance. The amount of budget 
authority saved as a result of the shift to project-based or 
tenant-based assistance shall be rescinded.''.
    (d) Section 8 Contract Renewals.--Section 405(a) of the 
Balanced Budget Downpayment Act, I (42 U.S.C. 1437f note) is 
amended by striking ``For'' and inserting ``Notwithstanding 
part 24 of title 24 of the Code of Federal Regualtions, for''.
    (e) Renewal Upon Request of Owner.--Section 211(b)(3) of 
the Departments of Veterans Affairs and Housing and Urban 
Development, and Independent Agencies Appropriations Act, 1997 
(Public Law 104-204; 110 Stat. 2896) is amended--
            (1) by striking the paragraph heading and inserting 
        the following:
            ``(3) Exemption of certain other projects.--''; and
            (2) by striking ``section 202 projects, section 811 
        projects and section 515 projects'' and inserting 
        ``section 202 projects, section 515 projects, projects 
        with contracts entered into pursuant to section 441 of 
        the Stewart B. McKinney Homeless Assistance Act, and 
        projects with rents that exceed 100 percent of fair 
        market rent for the market area, but that are less than 
        rents for comparable projects''.
    (f) Extension of Demonstration Contract Period.--Section 
212(g) of the Departments of Veterans Affairs and Housing and 
Urban Development, and Independent Agencies Appropriations Act, 
1997 (Public Law 104-204) is amended--
            (1) by inserting ``(1)'' after ``(g)'';
            (2) by inserting before the period at the end the 
        following: ``or in paragraph (2)''; and
            (3) by adding at the end the following:
    ``(2) The Secretary may renew a demonstration contract for 
an additional period of not to exceed 120 days, if--
            ``(A) the contract was originally executed before 
        February 1, 1997, and the Secretary determines, in the 
        sole discretion of the Secretary, that the renewal 
        period for the contract needs to exceed 1 year, due to 
        delay of publication of the Secretary's demonstration 
        program guidelines until January 23, 1997 (not to 
        exceed 21 projects); or
            ``(B) the contract was originally executed before 
        October 1, 1997, in connection with a project that has 
        been identified for restructuring under the joint 
        venture approach described in section VII.B.2. of the 
        Secretary's demonstration program guidelines, and the 
        Secretary determines, in the sole discretion of the 
        Secretary, that the renewal period for the contract 
        needs to exceed 1 year, due to delay in implementation 
        of the joint venture agreement required by the 
        guidelines (not to exceed 25 projects).''.

SEC. 524. SECTION 8 CONTRACT RENEWALS.

    (a) Section 8 Contract Renewal Authority.--
            (1)  In general.--Notwithstanding part 24 of title 
        24 of the Code of Federal Regulations and subject to 
        section 516 of this subtitle, for fiscal year 1999 and 
        henceforth, the Secretary may use amounts available for 
        the renewal of assistance under section 8 of the United 
        States Housing Act of 1937, upon termination or 
        expiration of a contract for assistance under section 8 
        (other than a contract for tenant-based assistance and 
        notwithstanding section 8(v) of such Act for loan 
        management assistance), to provide assistance under 
        section 8 of such Act at rent levels that do not exceed 
        comparable market rents for the market area. The 
        assistance shall be provided in accordance with terms 
        and conditions prescribed by the Secretary.
            (2) Exception projects.--Notwithstanding paragraph 
        (1), upon the request of the owner, the Secretary shall 
        renew an expiring contract in accordance with terms and 
        conditions prescribed by the Secretary at the lesser of 
        (i) existing rents, adjusted by an operating cost, 
        adjustment factor established by the Secretary, (ii) a 
        level that provides income sufficient to support a 
        budget-based rent (including a budget-based rent 
        adjustment if justified by reasonable and expected 
        operating expenses), or (iii) in the case of a contract 
        under the moderate rehabilitation program, other than a 
        moderate rehabilitation contract under section 441 of 
        the Stewart B. McKinney Homeless Assistance Act, the 
        base rent adjusted by an operating cost adjustment 
        factor established by the Secretary, for the following 
        categories of multifamily housing projects--
                    (A) projects for which the primary 
                financing or mortgage insurance was provided by 
                a unit of State government or a unit of general 
                local government (or an agency or 
                instrumentality of either) and is not insured 
                under the National Housing Act;
                    (B) projects for which the primary 
                financing was provided by a unit of State 
                government or a unit or general local 
                government (or an agency or instrumentality of 
                either) and the financing involves mortgage 
                insurance under the National Housing Act, such 
                that the implementation of a mortgage 
                restructuring and rental assistance sufficiency 
                plan under this Act is in conflict with 
                applicable law or agreements governing such 
                financing;
                    (C) projects financed under section 202 of 
                the Housing Act of 1959 or section 515 of the 
                Housing Act of 1949;
                    (D) projects that have an expiring contract 
                under section 8 of the United States Housing 
                Act of 1937 pursuant to section 441 of the 
                Stewart B. McKinney Homeless Assistance Act; 
                and
                    (E) projects that do not qualify as 
                eligible multifamily housing projects pursuant 
                to section 512(2) of this subtitle.

                  Subtitle B--Miscellaneous Provisions

SEC. 531. REHABILITATION GRANTS FOR CERTAIN INSURED PROJECTS.

    Section 236 of the National Housing Act (12 U.S.C. 1715z-1) 
is amended by adding at the end the following:
    ``(s) Grant Authority.--
            ``(1) In general.--The Secretary may make grants 
        for the capital costs of rehabilitation to owners of 
        projects that meet the eligibility and other criteria 
        set forth in, and in accordance with, this subsection.
            ``(2) Project eligibility.--A project may be 
        eligible for capital grant assistance under this 
        subsection--
                    ``(A) if--
                            ``(i) the project is or was insured 
                        under any provision of title II of the 
                        National Housing Act;
                            ``(ii) the project was assisted 
                        under section 8 of the United States 
                        Housing Act of 1937 on the date of 
                        enactment of the Multifamily Assisted 
                        Housing Reform and Affordability Act of 
                        1997; and
                            ``(iii) the project mortgage was 
                        not held by a State agency as of the 
                        date of enactment of the Multifamily 
                        Assisted Housing Reform and 
                        Affordability Act of 1997;
                    ``(B) if the project owner agrees to 
                maintain the housing quality standards as 
                required by the Secretary;
                    ``(C)(i) if the Secretary determines that 
                the owner or purchaser of the project has not 
                engaged in material adverse financial or 
                managerial actions or omissions with regard to 
                such project; or
                    ``(ii) if the Secretary elects to make such 
                determination, that the owner or purchaser of 
                the project has not engaged in material adverse 
                financial or managerial actions or omissions 
                with regard to other projects of such owner or 
                purchaser that are federally-assisted or 
                financed with a loan from, or mortgage insured 
                or guaranteed by, an agency of the Federal 
                government;
                    ``(iii) material adverse financial or 
                managerial actions or omissions, as the terms 
                are used in this subparagraph, include--
                            ``(I) materially violating any 
                        Federal, State, or local law or 
                        regulation with regard to this project 
                        or any other federally assisted 
                        project, after receipt of notice and an 
                        opportunity to cure;
                            ``(II) materially breaching a 
                        contract for assistance under section 8 
                        of the United States Housing Act of 
                        1937, after receipt of notice and an 
                        opportunity to cure;
                            ``(III) materially violating any 
                        applicable regulatory or other 
                        agreement with the Secretary or a 
                        participating administrative entity, 
                        after receipt of notice and an 
                        opportunity to cure;
                            ``(IV) repeatedly failing to make 
                        mortgage payments at times when project 
                        income was sufficient to maintain and 
                        operate the property;
                            ``(V) materially failing to 
                        maintain the property according to 
                        housing quality standards after receipt 
                        of notice and a reasonable opportunity 
                        to cure; or
                            ``(VI) committing any act or 
                        omission that would warrant suspension 
                        or debarment by the Secretary; and
                    ``(iv) the term `owner' as used in this 
                subparagraph, in addition to it having the same 
                meaning as in section 8(f) of the United States 
                Housing Act of 1937, also means an affiliate of 
                the owner; the term `purchaser' as used in this 
                subsection means any private person or entity, 
                including a cooperative, an agency of the 
                Federal Government, or a public housing agency, 
                that, upon purchase of the project, would have 
                the legal right to lease or sublease dwelling 
                units in the project, and also means an 
                affiliate of the purchaser; the terms 
                `affiliate of the owner' and `affiliate of the 
                purchaser' means any person or entity 
                (including, but not limited to, a general 
                partner or managing member, or an officer of 
                either) that controls an owner orpurchaser, is 
controlled by an owner or purchaser, or is under common control with 
the owner or purchaser; the term `control' means the direct or indirect 
power (under contract, equity ownership, the right to vote or determine 
a vote, or otherwise) to direct the financial legal, beneficial or 
other interests of the owner or purchaser; and
                    ``(D) if the project owner demonstrates to 
                the satisfaction of the Secretary--
                            ``(i) using information in a 
                        comprehensive needs assessment, that 
                        capital grant assistance is needed for 
                        rehabilitation of the project; and
                            ``(ii) that project income is not 
                        sufficient to support such 
                        rehabilitation.
            ``(3) Eligible purposes.--The Secretary may make 
        grants to the owners of eligible projects for the 
        purposes of--
                    ``(A) payment into project replacement 
                reserves;
                    ``(B) debt service payments on non-Federal 
                rehabilitation loans; and
                    ``(C) payment of nonrecurring maintenance 
                and capital improvements, under such terms and 
                conditions as are determined by the Secretary.
            ``(4) Grant agreement.--
                    ``(A) In general.--The Secretary shall 
                provide in any grant agreement under this 
                subsection that the grant shall be terminated 
                if the project fails to meet housing quality 
                standards, as applicable on the dateof 
enactment of the Multifamily Assisted Housing Reform and Affordability 
Act of 1997, or any successor standards for the physical conditions of 
projects, as are determined by the Secretary.
                    ``(B) Affordability and use clauses.--The 
                Secretary shall include in a grant agreement 
                under this subsection a requirement for the 
                project owners to maintain such affordability 
                and use restrictions as the Secretary 
                determines to be appropriate.
                    ``(C) Other terms.--The Secretary may 
                include in a grant agreement under this 
                subsection such other terms and conditions as 
                the Secretary determines to be necessary.
            ``(5) Delegation.--
                    ``(A) In general.--In addition to the 
                authorities set forth in subsection (p), the 
                Secretary may delegate to State and local 
                governments the responsibility for the 
                administration of grants under this subsection. 
                Any such government may carry out such 
                delegated responsibilities directly or under 
                contracts.
                    ``(B) Administration costs.--In addition to 
                other eligible purposes, amounts of grants 
                under this subsection may be made available for 
                costs of administration under subparagraph (A).
            ``(6) Funding.--
                    ``(A) In general.--For purposes of carrying 
                out this subsection, the Secretary may make 
                available amounts that are unobligated amounts 
                for contracts for interest reduction payments--
                            ``(i) that were previously 
                        obligated for contracts for interest 
                        reduction payments under this section 
                        until the insured mortgage under this 
                        section was extinguished;
                            ``(ii) that become available as a 
                        result of the outstanding principal 
                        balance of a mortgage having been 
                        written down;
                            ``(iii) that are uncommitted 
                        balances within the limitation on 
                        maximum payments that may have been, 
                        before the date of enactment of the 
                        Multifamily Assisted Housing Reform and 
                        Affordability Act of 1997, permitted in 
                        any fiscal year; or
                            ``(iv) that become available from 
                        any other source.
                    ``(B) Liquidation authority.--The Secretary 
                may liquidate obligations entered into under 
                this subsection under section 1305(10) of title 
                31, United States Code.
                    ``(C) Capital grants.--In making capital 
                grants under the terms of this subsection, 
                using the amounts that the Secretary has 
                recaptured from contracts for interest 
                reduction payments, the Secretary shall ensure 
                that the rates and amounts of outlays do not at 
                any time exceed the rates and amounts of 
                outlays that would have been experienced if the 
                insured mortgage had not been extinguished or 
                the principal amount had not been written down, 
                and the interest reduction payments that the 
                Secretary has recaptured had continued in 
                accordance with the terms in effect immediately 
                prior to such extinguishment or write-down.''.

SEC. 532. GAO REPORT ON SECTION 8 RENTAL ASSISTANCE FOR MULTIFAMILY 
                    HOUSING PROJECTS.

    Not later than the expiration of the 18-month period 
beginning on the date of the enactment of this Act, the 
Comptroller General of the United States shall submit a report 
to the Congress analyzing--
            (1) the housing projects for which project-based 
        assistance is provided under section 8 of the United 
        States Housing Act of 1937, but which are not subject 
        to a mortgage insured or held by the Secretary under 
        the National Housing Act;
            (2) how State and local housing finance agencies 
        have benefited financially from the rental assistance 
        program under section 8 of the United States Housing 
        Act of 1937, including any benefits from fees, bond 
        financings, and mortgage refinancings; and
            (3) the extent and effectiveness of State and local 
        housing finance agencies oversight of the physical and 
        financial management and condition of multifamily 
        housing projects for which project-based assistance is 
        provided under section 8 of the United States Housing 
        Act of 1937.

                   Subtitle C--Enforcement Provisions

SEC. 541. IMPLEMENTATION.

    (a) Issuance of Necessary Regulations.--Notwithstanding 
section 7(o) of the Department of Housing and Urban Development 
Act or part 10 of title 24, Code of Federal Regulations (as in 
existence on the date of enactment of this Act), the Secretary 
shall issue such regulations as the Secretary determines to be 
necessary to implement this subtitle and the amendments made by 
this subtitle in accordance with section 552 or 553 of title 5, 
United States Code, as determined by the Secretary.
    (b) Use of Existing Regulations.--In implementing any 
provision of this subtitle, the Secretary may, in the 
discretion of the Secretary, provide for the use of existing 
regulations to the extent appropriate, without rulemaking.

SEC. 542. INCOME VERIFICATION.

    (a) Reinstitution of Requirements Regarding HUD Access to 
Certain Information of State Agencies.--
            (1) In general.--Section 303(i) of the Social 
        Security Act is amended by striking paragraph (5).
            (2) Effective date.--The amendment made by this 
        subsection shall apply to any request for information 
        made after the date of the enactment of this Act.
    (b) Repeal of Termination Regarding Housing Assistance 
Programs.--Section 6103(l)(7)(D) of the Internal Revenue Code 
of 1986 is amended by striking the last sentence.

           Part 1--FHA Single Family and Multifamily Housing

SEC. 551. AUTHORIZATION TO IMMEDIATELY SUSPEND MORTGAGEES.

    Section 202(c)(3)(C) of the National Housing Act (12 U.S.C. 
1708(c)(3)(C)) is amended by inserting after the first sentence 
the following: ``Notwithstanding paragraph (4)(A), a suspension 
shall be effective upon issuance by the Board if the Board 
determines that there exists adequate evidence that immediate 
action is required to protect the financial interests of the 
Department or the public.''.

SEC. 552. EXTENSION OF EQUITY SKIMMING TO OTHER SINGLE FAMILY AND 
                    MULTIFAMILY HOUSING PROGRAMS.

    Section 254 of the National Housing Act (12 U.S.C. 1715z-
19) is amended to read as follows:

``SEC. 254. EQUITY SKIMMING PENALTY.

    ``(a) In General.--Whoever, as an owner, agent, or manager, 
or who is otherwise in custody, control, or possession of a 
multifamily project or a 1- to 4-family residence that is 
security for a mortgage note that is described in subsection 
(b), willfully uses or authorizes the use of any part of the 
rents, assets, proceeds, income, or other funds derived from 
property covered by that mortgage note for any purpose other 
than to meet reasonable and necessary expenses that include 
expenses approved by the Secretary if such approval is 
required, in a period during which the mortgage note is in 
default or the project is in a nonsurplus cash position, as 
defined by the regulatory agreement covering the property, or 
the mortgagor has failed to comply with the provisions of such 
other form of regulatory control imposed by the Secretary, 
shall be fined not more than $500,000, imprisoned not more than 
5 years, or both.
    ``(b) Mortgage Notes Described.--For purposes of subsection 
(a), a mortgage note is described in this subsection if it--
            ``(1) is insured, acquired, or held by the 
        Secretary pursuant to this Act;
            ``(2) is made pursuant to section 202 of the 
        Housing Act of 1959 (including property still subject 
        to section 202 program requirements that existed before 
        the date of enactment of the Cranston-Gonzalez National 
        Affordable Housing Act); or
            ``(3) is insured or held pursuant to section 542 of 
        the Housing and Community Development Act of1992, but 
is not reinsured under section 542 of the Housing and Community 
Development Act of 1992.''.

SEC. 553. CIVIL MONEY PENALTIES AGAINST MORTGAGEES, LENDERS, AND OTHER 
                    PARTICIPANTS IN FHA PROGRAMS.

    (a) Change to Section Title.--Section 536 of the National 
Housing Act (12 U.S.C. 1735f-14) is amended by striking the 
section heading and the section designation and inserting the 
following:

``SEC. 536. CIVIL MONEY PENALTIES AGAINST MORTGAGEES, LENDERS, AND 
                    OTHER PARTICIPANTS IN FHA PROGRAMS.''.

    (b) Expansion of Persons Eligible for Penalty.--Section 
536(a) of the National Housing Act (12 U.S.C. 1735f-14(a)) is 
amended--
            (1) in paragraph (1), by striking the first 
        sentence and inserting the following: ``If a mortgagee 
        approved under the Act, a lender holding a contract of 
        insurance under title I, or a principal, officer, or 
        employee of such mortgagee or lender, or other person 
        or entity participating in either an insured mortgage 
        or title I loan transaction under this Act or providing 
        assistance to the borrower in connection with any such 
        loan, including sellers of the real estate involved, 
        borrowers, closing agents, title companies, real estate 
        agents, mortgage brokers, appraisers, loan 
        correspondents and dealers, knowingly and materially 
        violates any applicable provision of subsection (b), 
        the Secretary may impose a civil money penalty on the 
        mortgagee or lender, or such other person or entity, in 
        accordance with this section. The penalty under this 
        paragraph shall be in addition to any other available 
        civil remedy or any available criminal penalty, and may 
        be imposed whether or not the Secretary imposes other 
        administrative sanctions.''; and
            (2) in paragraph (2)--
                    (A) in the first sentence, by inserting 
                ``or such other person or entity'' after 
                ``lender''; and
                    (B) in the second sentence, by striking 
                ``provision'' and inserting ``the provisions''.
    (c) Additional Violations for Mortgagees, Lenders, and 
Other Participants in FHA Programs.--Section 536(b) of the 
National Housing Act (12 U.S.C. 1735f-14(b)) is amended--
            (1) by redesignating paragraph (2) as paragraph 
        (3);
            (2) by inserting after paragraph (1) the following:
            ``(2) The Secretary may impose a civil money 
        penalty under subsection (a) for any knowing and 
        material violation by a principal, officer, or employee 
        of a mortgagee or lender, or other participants in 
        either an insured mortgage or title I loan transaction 
        under this Act or provision of assistance to the 
        borrower in connection with any such loan, including 
        sellers of the real estate involved, borrowers, closing 
        agents, title companies, real estate agents, mortgage 
        brokers, appraisers, loan correspondents, and dealers 
        for--
                    ``(A) submission to the Secretary of 
                information that was false, in connection with 
                any mortgage insured under this Act, or any 
                loan that is covered by a contract of insurance 
                under title I of this Act;
                    ``(B) falsely certifying to the Secretary 
                or submitting to the Secretary a false 
                certification by another person or entity; or
                    ``(C) failure by a loan correspondent or 
                dealer to submit to the Secretary information 
                which is required by regulations or directives 
                in connection with any loan that is covered by 
                a contract of insurance under title I.''; and
            (3) in paragraph (3), as redesignated, by striking 
        ``or paragraph (1)(F)'' and inserting ``or (F), or 
        paragraph (2) (A), (B), or (C)''.
    (d) Conforming and Technical Amendments.--Section 536 of 
the National Housing Act (12 U.S.C. 1735f-14) is amended--
            (1) in subsection (c)(1)(B), by inserting after 
        ``lender'' the following: ``or such other person or 
        entity'';
            (2) in subsection (d)(1)--
                    (A) by inserting ``or such other person or 
                entity'' after ``lender''; and
                    (B) by striking ``part 25'' and inserting 
                ``parts 24 and 25''; and
            (3) in subsection (e), by inserting ``or such other 
        person or entity'' after ``lender'' each place that 
        term appears.

                   Part 2--FHA Multifamily Provisions

SEC. 561. CIVIL MONEY PENALTIES AGAINST GENERAL PARTNERS, OFFICERS, 
                    DIRECTORS, AND CERTAIN MANAGING AGENTS OF 
                    MULTIFAMILY PROJECTS.

    (a) Civil Money Penalties Against Multifamily Mortgagors.--
Section 537 of the National Housing Act (12 U.S.C. 1735f-15) is 
amended--
            (1) in subsection (b)(1), by striking ``on that 
        mortgagor'' and inserting the following: ``on that 
        mortgagor, on a general partner of a partnership 
        mortgagor, or on any officer or director of a corporate 
        mortgagor'';
            (2) in subsection (c)--
                    (A) by striking the subsection heading and 
                inserting the following:
    ``(c) Other Violations.--''; and
                    (B) in paragraph (1)--
                            (i) by striking ``Violations.--The 
                        Secretary may'' and all that follows 
                        through the colon and inserting the 
                        following:
                    ``(A) Liable parties.--The Secretary may 
                also impose a civil money penalty under this 
                section on--
                            ``(i) any mortgagor of a property 
                        that includes 5 or more living units 
                        and that has a mortgage insured, 
                        coinsured, or held pursuant to this 
                        Act;
                            ``(ii) any general partner of a 
                        partnership mortgagor of such property;
                            ``(iii) any officer or director of 
                        a corporate mortgagor;
                            ``(iv) any agent employed to manage 
                        the property that has an identity of 
                        interest with the mortgagor, with the 
                        general partner of a partnership 
                        mortgagor, or with any officer or 
                        director of a corporate mortgagor of 
                        such property; or
                            ``(v) any member of a limited 
                        liability company that is the mortgagor 
                        of such property or is the general 
                        partner of a limited partnership 
                        mortgagor or is a partner of a general 
                        partnership mortgagor.
                    ``(B) Violations.--A penalty may be imposed 
                under this section upon any liable party under 
                subparagraph (A) that knowingly and materially 
                takes any of the following actions:'';
                            (ii) in subparagraph (B), as 
                        designated by clause (i), by 
                        redesignating the subparagraph 
                        designations (A) through (L) as clauses 
                        (i) through (xii), respectively;
                            (iii) by adding after clause (xii), 
                        as redesignated by clause (ii), the 
                        following:
                            ``(xiii) Failure to maintain the 
                        premises, accommodations, any living 
                        unit in the project, and the grounds 
                        and equipment appurtenant thereto in 
                        good repair and condition in accordance 
                        with regulations and requirements of 
                        the Secretary, except that nothing in 
                        this clause shall have the effect of 
                        altering the provisions of an existing 
                        regulatory agreement or federally 
                        insured mortgage on the property.
                            ``(xiv) Failure, by a mortgagor, a 
                        general partner of a partnership 
                        mortgagor, or an officer or director of 
                        a corporate mortgagor, to provide 
                        management for the project that is 
                        acceptable to the Secretary pursuant to 
                        regulations and requirements of the 
                        Secretary.
                            ``(xv) Failure to provide access to 
                        the books, records, and accounts 
                        related to the operations of the 
                        mortgaged property and of the 
                        project.''; and
                            (iv) in the last sentence, by 
                        deleting ``of such agreement'' and 
                        inserting ``of this subsection'';
            (3) in subsection (d)--
                    (A) in paragraph (1)(B), by inserting after 
                ``mortgagor'' the following: ``, general 
                partner of a partnership mortgagor, officer or 
                directorof a corporate mortgagor, or identity 
of interest agent employed to manage the property''; and
                    (B) by adding at the end the following:
            ``(5) Payment of penalty.--No payment of a civil 
        money penalty levied under this section shall be 
        payable out of project income.'';
            (4) in subsection (e)(1), by deleting ``a 
        mortgagor'' and inserting ``an entity or person'';
            (5) in subsection (f), by inserting after 
        ``mortgagor'' each place such term appears the 
        following: ``, general partner of a partnership 
        mortgagor, officer or director of a corporate 
        mortgagor, or identity of interest agent employed to 
        manage the property'';
            (6) by striking the heading of subsection (f) and 
        inserting the following: ``Civil Money Penalties 
        Against Multifamily Mortgagors, General Partners of 
        Partnership Mortgagors, Officers and Directors of 
        Corporate Mortgagors, and Certain Managing Agents''; 
        and
            (7) by adding at the end the following:
    ``(k) Identity of Interest Managing Agent.--In this 
section, the terms `agent employed to manage the property that 
has an identity of interest' and `identity of interest agent' 
mean an entity--
            ``(1) that has management responsibility for a 
        project;
            ``(2) in which the ownership entity, including its 
        general partner or partners (if applicable) and its 
        officers or directors (if applicable), has an ownership 
        interest; and
            ``(3) over which the ownership entity exerts 
        effective control.''.
    (b) Implementation.--
            (1) Public comment.--The Secretary shall implement 
        the amendments made by this section by regulation 
        issued after notice and opportunity for public comment. 
        The notice shall seek comments primarily as to the 
        definitions of the terms ``ownership interest in'' and 
        ``effective control'', as those terms are used in the 
        definition of the terms ``agent employed to manage the 
        property that has an identity of interest'' and 
        ``identity of interest agent''.
            (2) Timing.--A proposed rule implementing the 
        amendments made by this section shall be published not 
        later than 1 year after the date of enactment of this 
        Act.
    (c) Applicability of Amendments.--The amendments made by 
subsection (a) shall apply only with respect to--
            (1) violations that occur on or after the effective 
        date of the final regulations implementing the 
        amendments made by this section; and
            (2) in the case of a continuing violation (as 
        determined by the Secretary of Housing and Urban 
        Development), any portion of a violation that occurs on 
        or after that date.

SEC. 562. CIVIL MONEY PENALTIES FOR NONCOMPLIANCE WITH SECTION 8 HAP 
                    CONTRACTS.

    (a) Basic Authority.--Title I of the United States Housing 
Act of 1937 (42 U.S.C. 1437 et seq.) is amended--
            (1) by designating the second section designated as 
        section 27 (as added by section 903(b) of Public Law 
        104-193 (110 Stat. 2348)) as section 28; and
            (2) by adding at the end the following:

``SEC. 29. CIVIL MONEY PENALTIES AGAINST SECTION 8 OWNERS.

    ``(a) In General.--
            ``(1) Effect on other remedies.--The penalties set 
        forth in this section shall be in addition to any other 
        available civil remedy or any available criminal 
        penalty, and may be imposed regardless of whether the 
        Secretary imposes other administrative sanctions.
            ``(2) Failure of secretary.--The Secretary may not 
        impose penalties under this section for a violation, if 
        a material cause of the violation is the failure of the 
        Secretary, an agent of the Secretary, or a public 
        housing agency to comply with an existing agreement.
    ``(b) Violations of Housing Assistance Payment Contracts 
for Which Penalty May Be Imposed.--
            ``(1) Liable parties.--The Secretary may impose a 
        civil money penalty under this section on--
                    ``(A) any owner of a property receiving 
                project-based assistance under section 8;
                    ``(B) any general partner of a partnership 
                owner of that property; and
                    ``(C) any agent employed to manage the 
                property that has an identity of interest with 
                the owner or the general partner of a 
                partnership owner of the property.
            ``(2) Violations.--A penalty may be imposed under 
        this section for a knowing and material breach of a 
        housing assistance payments contract, including the 
        following--
                    ``(A) failure to provide decent, safe, and 
                sanitary housing pursuant to section 8; or
                    ``(B) knowing or willful submission of 
                false, fictitious, or fraudulent statements or 
                requests for housing assistance payments to the 
                Secretary or to any department or agency of the 
                United States.
            ``(3) Amount of penalty.--The amount of a penalty 
        imposed for a violation under this subsection, as 
        determined by the Secretary, may not exceed $25,000 per 
        violation.
    ``(c) Agency Procedures.--
            ``(1) Establishment.--The Secretary shall issue 
        regulations establishing standards and procedures 
        governing the imposition of civil money penalties under 
        subsection (b). These standards and procedures--
                    ``(A) shall provide for the Secretary or 
                other department official to make the 
                determination to impose the penalty;
                    ``(B) shall provide for the imposition of a 
                penalty only after the liable party has 
                received notice and the opportunity for a 
                hearing on the record; and
                    ``(C) may provide for review by the 
                Secretary of any determination or order, or 
                interlocutory ruling, arising from a hearing 
                and judicial review, as provided under 
                subsection (d).
            ``(2) Final orders.--
                    ``(A) In general.--If a hearing is not 
                requested before the expiration of the 15-day 
                period beginning on the date on which the 
                notice of opportunity for hearing is received, 
                the imposition of a penalty under subsection 
                (b) shall constitute a final and unappealable 
                determination.
                    ``(B) Effect of review.--If the Secretary 
                reviews the determination or order, the 
                Secretary may affirm, modify, or reverse that 
                determination or order.
                    ``(C) Failure to review.--If the Secretary 
                does not review that determination or order 
                before the expiration of the 90-day period 
                beginning on the date on which the 
                determination or order is issued, the 
                determination or order shall be final.
            ``(3) Factors in determining amount of penalty.--In 
        determining the amount of a penalty under subsection 
        (b), the Secretary shall take into consideration--
                    ``(A) the gravity of the offense;
                    ``(B) any history of prior offenses by the 
                violator (including offenses occurring before 
                the enactment of this section);
                    ``(C) the ability of the violator to pay 
                the penalty;
                    ``(D) any injury to tenants;
                    ``(E) any injury to the public;
                    ``(F) any benefits received by the violator 
                as a result of the violation;
                    ``(G) deterrence of future violations; and
                    ``(H) such other factors as the Secretary 
                may establish by regulation.
            ``(4) Payment of penalty.--No payment of a civil 
        money penalty levied under this section shall be 
        payable out of project income.
    ``(d) Judicial Review of Agency Determination.--Judicial 
review of determinations made under this section shall be 
carried out in accordance with section 537(e) of the National 
Housing Act.
    ``(e) Remedies for Noncompliance.--
            ``(1) Judicial intervention.--
                    ``(A) In general.--If a person or entity 
                fails to comply with the determination or order 
                of the Secretary imposing a civil money penalty 
                under subsection (b), after the determination 
                or order is no longer subject to review as 
                provided by subsections (c) and (d), the 
                Secretary may request the Attorney General of 
                the United States to bring an action in an 
                appropriate United States district court to 
                obtain a monetary judgment against that person 
                or entity and such other relief as may be 
                available.
                    ``(B) Fees and expenses.--Any monetary 
                judgment awarded in an action brought under 
                this paragraph may, in the discretion of the 
                court, include the attorney's fees and other 
                expenses incurred by the United States in 
                connection with the action.
            ``(2) Nonreviewability of determination or order.--
        In an action under this subsection, the validity and 
        appropriateness of the determination or order of the 
        Secretary imposing the penalty shall not be subject to 
        review.
    ``(f) Settlement by Secretary.--The Secretary may 
compromise, modify, or remit any civil money penalty which may 
be, or has been, imposed under this section.
    ``(g) Deposit of Penalties.--
            ``(1) In general.--Notwithstanding any other 
        provision of law, if the mortgage covering the property 
        receiving assistance under section 8 is insured or 
        formerly insured by the Secretary, the Secretary shall 
        apply all civil money penalties collected under this 
        section to the appropriate insurance fund or funds 
        established under this Act, as determined by the 
        Secretary.
            ``(2) Exception.--Notwithstanding any other 
        provision of law, if the mortgage covering the property 
        receiving assistance under section 8 is neither insured 
        nor formerly insured by the Secretary, the Secretary 
        shall make all civil money penalties collected under 
        this section available for use by the appropriate 
        office within the Department for administrative costs 
        related to enforcement of the requirements of the 
        various programs administered by the Secretary.
    ``(h) Definitions.--In this section--
            ``(1) the term `agent employed to manage the 
        property that has an identity of interest' means an 
        entity--
                    ``(A) that has management responsibility 
                for a project;
                    ``(B) in which the ownership entity, 
                including its general partner or partners (if 
                applicable), has an ownership interest; and
                    ``(C) over which such ownership entity 
                exerts effective control; and
            ``(2) the term `knowing' means having actual 
        knowledge of or acting with deliberate ignorance of or 
        reckless disregard for the prohibitions under this 
        section.''.
    (b) Applicability.--The amendments made by subsection (a) 
shall apply only with respect to--
            (1) violations that occur on or after the effective 
        date of final regulations implementing the amendments 
        made by this section; and
            (2) in the case of a continuing violation (as 
        determined by the Secretary of Housing and Urban 
        Development), any portion of a violation that occurs on 
        or after such date.
    (c) Implementation.--
            (1) Regulations.--
                    (A) In general.--The Secretary shall 
                implement the amendments made by this section 
                by regulation issued after notice and 
                opportunity for public comment.
                    (B) Comments sought.--The notice under 
                subparagraph (A) shall seek comments as to the 
                definitions of the terms ``ownership interest 
                in'' and ``effective control'', as such terms 
                are used in the definition of the term ``agent 
                employed to manage such property that has an 
                identity of interest''.
            (2) Timing.--A proposed rule implementing the 
        amendments made by this section shall be published not 
        later than 1 year after the date of enactment of this 
        Act.

SEC. 563. EXTENSION OF DOUBLE DAMAGES REMEDY.

    Section 421 of the Housing and Community Development Act of 
1987 (12 U.S.C. 1715z-4a) is amended--
            (1) in subsection (a)(1)--
                    (A) in the first sentence, by striking 
                ``Act; or (B)'' and inserting the following: 
                ``Act; (B) a regulatory agreement that applies 
                to a multifamily project whose mortgage is 
                insured or held by the Secretary under section 
                202 of the Housing Act of 1959 (including 
                property subject to section 202 of such Act as 
                it existed before enactment of the Cranston-
                Gonzalez National Affordable Housing Act of 
                1990); (C) a regulatory agreement or such other 
                form of regulatory control as may be imposed by 
                the Secretary that applies to mortgages insured 
                or held by the Secretary under section 542 of 
                the Housing and Community Development Act of 
                1992, but not reinsured under section 542 of 
                the Housing and Community Development Act of 
                1992; or (D)''; and
                    (B) in the second sentence, by inserting 
                after ``agreement'' the following: ``, or such 
                other form of regulatory control as may be 
                imposed by the Secretary,'';
            (2) in subsection (a)(2), by inserting after 
        ``Act,'' the following: ``under section 202 of the 
        Housing Act of 1959 (including section 202 of such Act 
        as it existed before enactment of the Cranston-Gonzalez 
        National Affordable Housing Act of 1990) and under 
        section 542 of the Housing and Community Development 
        Act of 1992,'';
            (3) in subsection (b), by inserting after 
        ``agreement'' the following: ``, or such other form of 
        regulatory control as may be imposed by the 
        Secretary,'';
            (4) in subsection (c)--
                    (A) in the first sentence, by inserting 
                after ``agreement'' the following: ``, or such 
                other form of regulatory control as may be 
                imposed by the Secretary,''; and
                    (B) in the second sentence, by inserting 
                before the period the following: ``or, in the 
                case of any project for which the mortgage is 
                held by the Secretary under section 202 of the 
                Housing Act of 1959 (including property subject 
                to section 202 of such Act as it existed before 
                enactment of the Cranston-Gonzalez National 
                Affordable Housing Act of 1990), to the project 
                or to the Department for use by the appropriate 
                office within the Department for administrative 
                costs related to enforcement of the 
                requirements of the various programs 
                administered by the Secretary, as 
                appropriate''; and
            (5) in subsection (d), by inserting after 
        ``agreement'' the following: ``, or such other form of 
        regulatory control as may be imposed by the 
        Secretary,''.

SEC. 564. OBSTRUCTION OF FEDERAL AUDITS.

    Section 1516(a) of title 18, United States Code, is amended 
by inserting after ``under a contract or subcontract,'' the 
following: ``or relating to any property that is security for a 
mortgage note that is insured, guaranteed, acquired, or held by 
the Secretary of Housing and Urban Development pursuant to any 
Act administered by the Secretary,''.

   Subtitle D--Office of Multifamily Housing Assistance Restructuring

SEC. 571. ESTABLISHMENT OF OFFICE OF MULTIFAMILY HOUSING ASSISTANCE 
                    RESTRUCTURING.

    There is hereby established an office within the Department 
of Housing and Urban Development, which shall be known as the 
Office of Multifamily Housing Assistance Restructuring.

SEC. 572. DIRECTOR.

    (a) Appointment.--The Office shall be under the management 
of a Director, who shall be appointed by the President by and 
with the advice and consent of the Senate, from among 
individuals who are citizens of the United States and have a 
demonstrated understanding of financing and mortgage 
restructuring for affordable multifamily housing. Not later 
than 60 days after the date of the enactment of this Act, the 
President shall submit to the Senate a nomination for initial 
appointment to the position of Director.
    (b) Vacancy.--A vacancy in the position of Director shall 
be filled in the manner in which the original appointment was 
made under subsection (a).
    (c) Deputy Director.--
            (1) In general.--The Office shall have a Deputy 
        Director who shall be appointed by the Director from 
        among individuals who are citizens of the United States 
        and have a demonstrated understanding of financing and 
        mortgage restructuring for affordable multifamily 
        housing.
            (2) Functions.--The Deputy Director shall have such 
        functions, powers, and duties as the Director shall 
        prescribe. In the event of the death, resignation, 
        sickness, or absence of the Director, the Deputy 
        Director shall serve as acting Director until the 
        return of the Director or the appointment of a 
        successor pursuant to subsection (b).

SEC. 573. DUTY AND AUTHORITY OF DIRECTOR.

    (a) Duty.--The Secretary shall, acting through the 
Director, administer the program of mortgage and rental 
assistance restructuring for eligible multifamily housing 
projects under subtitle A. During the period before the 
Director is appointed, the Secretary may carry out such 
program.
    (b) Authority.--The Director is authorized to make such 
determinations, take such actions, issue such regulations, and 
perform such functions assigned to the Director under law as 
the Director determines necessary to carry out such functions, 
subject to the review and approval of the Secretary. The 
Director shall semiannually submit a report to the Secretary 
regarding the activities, determinations, and actions of the 
Director.
    (c) Delegation of Authority.--The Director may delegate to 
officers and employees of the Office (but not to contractors, 
subcontractors, or consultants) any of the functions, powers, 
and duties of the Director, as the Director considers 
appropriate.
    (d) Independence in Providing Information to Congress.--
            (1) In general.--Notwithstanding subsection (a) or 
        (b), the Director shall not be required to obtain the 
        prior approval, comment, or review of any officer or 
        agency of the United States before submitting to the 
        Congress, or any committee or subcommittee thereof, any 
        reports, recommendations, testimony, or comments if 
        such submissions include a statement indicating that 
        the views expressed therein are those of the Director 
        and do notnecessarily represent the views of the 
Secretary or the President.
            (2) Requirement.--If the Director determines at any 
        time that the Secretary is taking or has taken any 
        action that interferes with the ability of the Director 
        to carry out the duties of the Director under this Act 
        or that affects the administration of the program under 
        subtitle A of this Act in manner that is inconsistent 
        with the purposes of this Act, including any proposed 
        action by the Director, in the discretion of the 
        Director, that is overruled by the Secretary, the 
        Director shall immediately report directly to the 
        Committee on Banking and Financial Services of the 
        House of Representatives and the Committee on Banking, 
        Housing, and Urban Affairs of the Senate regarding such 
        action. Notwithstanding subsection (a) or (b), any 
        determination or report under this paragraph by the 
        Director shall not be subject to prior review or 
        approval of the Secretary.

SEC. 574. PERSONNEL.

    (a) Office Personnel.--The Director may appoint and fix the 
compensation of such officers and employees of the Office as 
the Director considers necessary to carry out the functions of 
the Director and the Office. Officers and employees may be paid 
without regard to the provisions of chapter 51 and subchapter 
III of chapter 53 of title 5, United States Code, relating to 
classification and General Schedule pay rates.
    (b) Comparability of Compensation With Federal Banking 
Agencies.--In fixing and directing compensation under 
subsection (a), the Director shall consult with, and maintain 
comparability with compensation of officers and employees of 
the Federal Deposit Insurance Corporation.
    (c) Personnel of Other Federal Agencies.--In carrying out 
the duties of the Office, the Director may use information, 
services, staff, and facilities of any executive agency, 
independent agency, or department on a reimbursable basis, with 
the consent of such agency or department.
    (d) Outside Experts and Consultants.--The Director may 
procure temporary and intermittent services under section 
3109(b) of title 5, United States Code.

SEC. 575. BUDGET AND FINANCIAL REPORTS.

    (a) Financial Operating Plans and Forecasts.--Before the 
beginning of each fiscal year, the Secretary shall submit a 
copy of the financial operating plans and forecasts for the 
Office to the Director of the Office of Management and Budget.
    (b) Reports of Operations.--As soon as practicable after 
the end of each fiscal year and each quarter thereof, the 
Secretary shall submit a copy of the report of the results of 
the operations of the Office during such period to the Director 
of the Office of Management and Budget.
    (c) Inclusion in President's Budget.--The annual plans, 
forecasts, and reports required under this section shall be 
included (1) in the Budget of the United States in the 
appropriate form, and (2) in the congressional justifications 
of the Department of Housing and Urban Development for each 
fiscal year in a form determined by the Secretary.

SEC. 576. LIMITATION ON SUBSEQUENT EMPLOYMENT.

    Neither the Director nor any former officer or employee of 
the Office who, while employed by the Office, was compensated 
at a rate in excess of the lowest rate for a position 
classified higher than GS-15 of the General Schedule under 
section 5107 of title 5, United States Code, may, during the 2-
year period beginning on the date of separation from employment 
by the Office, accept compensation from any party (other than a 
Federal agency) having any financial interest in any mortgage 
restructuring and rental assistance sufficiency plan under 
subtitle A or comparable matter in which the Director or such 
officer or employee had direct participation or supervision.

SEC. 577. AUDITS BY GAO.

    The Comptroller General shall audit the operations of the 
Office in accordance with generally accepted Government 
auditing standards. All books, records, accounts, reports, 
files, and property belonging to, or used by, the Office shall 
be made available to the Comptroller General. Audits under this 
section shall be conducted annually for the first 2 fiscal 
years following the date of the enactment of this Act and as 
appropriate thereafter.

SEC. 578. SUSPENSION OF PROGRAM BECAUSE OF FAILURE TO APPOINT DIRECTOR.

    (a) In General.--If, upon the expiration of the 12-month 
period beginning on the date of the enactment of this Act, the 
initial appointment to the office of Director has not been 
made, the operation of the program under subtitle A shall 
immediately be suspended and such provisions shall not have any 
force or effect during the period that ends upon the making of 
such appointment.
    (b) Interim applicability of demonstration program.--
Notwithstanding any other provision of law, during the period 
referred to in subsection (a), the Secretary shall carry out 
sections 211 and 212 of the Departments of Veterans Affairs and 
Housing and Urban Development, and Independent Agencies 
Appropriations Act, 1997. For purposes of applying such 
sections pursuant to the authority under this section, the term 
``expiring contract'' shall have the meaning given in such 
sections, except that such term shall also include any contract 
for project-based assistance under section 8 of the United 
States Housing Act of 1937 that expires during the period that 
the program is suspended under subsection (a).

SEC. 579. TERMINATION.

    (a) Repeal.--Subtitle A (except for section 524) and 
subtitle D (except for this section) are repealed effective 
October 1, 2001.
    (b) Exception.--Notwithstanding the repeal under subsection 
(a), the provisions of subtitle A (as in effect immediately 
before such repeal) shall apply with respect to projects and 
programs for which binding commitments have been entered into 
under this Act before October 1, 2001.
    (c) Termination of Director and Office.--The Office of 
Multifamily Housing Assistance Restructuring and the position 
of Director of such Office shall terminate upon September 30, 
2001.
    (d) Transfer of Authority.--Effective upon the termination 
under subsection (c), any authority and responsibilities 
assigned to the Director that remain applicable after such date 
pursuant to subsection (b) are transferred to the Secretary.
    This Act may be cited as the ``Departments of Veterans 
Affairs and Housing and Urban Development, and Independent 
Agencies Appropriations Act, 1998''.
    And the Senate agree to the same.
                                   Jerry Lewis,
                                   Tom DeLay,
                                   James T. Walsh,
                                   Dave Hobson,
                                   Joe Knollenberg,
                                   R.P. Frelinghuysen,
                                   Roger F. Wicker,
                                   Bob Livingston,
                                   Louis Stokes,
                                   Alan B. Mollohan,
                                   Marcy Kaptur,
                                   Carrie P. Meek,
                                   David E. Price,
                                   Dave Obey,
                                 Managers on the Part of the House.

                                   Christopher S. Bond,
                                   Conrad Burns,
                                   Ted Stevens,
                                   Richard Shelby,
                                   Ben Nighthorse Campbell,
                                   Larry E. Craig,
                                   Thad Cochran,
                                   Barbara A. Mikulski,
                                   Patrick J. Leahy,
                                   Frank R. Lautenberg,
                                   Tom Harkin,
                                   Barbara Boxer,
                                   Robert C. Byrd,
                                Managers on the Part of the Senate.
       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

      The managers on the part of the House and the Senate at 
the conference on the disagreeing votes of the two Houses on 
the amendment of the Senate to the bill (H.R. 2158) making 
appropriations for the Departments of Veterans Affairs and 
Housing and Urban Development, and for sundry independent 
agencies, commissions, corporations, and offices for the fiscal 
year ending September 30, 1998, and for other purposes, submit 
the following joint statement to the House and the Senate in 
explanation of the effect of the action agreed upon by the 
managers and recommended in the accompanying report.
      The language and allocations set forth in House Report 
105-175 and Senate Report 105-53 should be complied with unless 
specifically addressed to the contrary in the conference report 
and statement of the managers. Report language included by the 
House which is not changed by the report of the Senate or the 
conference, and Senate report language which is not changed by 
the conference is approved by the committee of conference. The 
statement of the managers, while repeating some report language 
for emphasis, does not intend to negate the language referred 
to above unless expressly provided herein. In cases in which 
the House or Senate have directed the submission of a report, 
such report is to be submitted to both House and Senate 
Committees on Appropriations.

                TITLE I--DEPARTMENT OF VETERANS AFFAIRS

                     Veterans Health Administration

                              medical care

      Appropriates $17,057,396,000 for medical care, instead of 
$17,006,846,000 as proposed by the House and $17,026,846,000 as 
proposed by the Senate.
      The increase of $98,550,000 consists of the following 
additions to the budget request:
      +$68,000,000 to continue the funding of compensation and 
pension examinations from the medical care account.
      +$30,550,000 as a general increase, subject to approval 
in the operating plan.
      The conferees agree that within the total amount 
provided, $6,000,000 is to establish the Musculoskeletal 
Disease Prevention and Treatment Research Center at the Jerry 
L. Pettis Memorial VA Medical Center in Loma Linda, California. 
This amount is in addition to the amount that would otherwise 
be made available to VISN 22.
      The conferees wish to emphasize language in the House and 
Senate reports regarding expanding an outpatient clinic in 
Williamsport, Pennsylvania; activation costs for construction 
projects at the medical centers in Wilkes-Barre, Pennsylvania 
and Phoenix, Arizona; and the demonstration project involving 
the Clarksburg VA Medical Center and Ruby Memorial Hospital. 
The VA is urged to establish a community based outpatient 
clinic in Brookhaven, New York.
      Deletes language proposed by the House and stricken by 
the Senate enabling compensation and pension exams to be 
directly funded from Veterans Benefits Administration 
resources. The Administration proposed that the cost of 
conducting medical examinations with respect to veterans' 
claims for compensation or pension be reimbursed from the 
general operating expenses appropriation. The conferees expect 
the results of a soon to begin pilot program to contract for 
compensation and pension exams will determine the advisability 
of this concept.
      Delays the availability of $570,000,000 of the medical 
care appropriation in the equipment and land and structures 
object classifications until August 1, 1998, instead of 
delaying the availability of $565,000,000 as proposed by the 
House and $550,000,000 as proposed by the Senate.
      Inserts language as proposed by the House earmarking not 
to exceed $5,000,000 for a pilot program on the cost-
effectiveness of contracting with local hospitals in East 
Central Florida for the provision of non-emergent inpatient 
health care needs of veterans. The VA is to submit a report to 
the Committees on Appropriations on how it plans to conduct the 
demonstration program prior to implementation.
      Inserts modifications to identical language proposed by 
the House and the Senate making amounts recovered or collected 
and deposited in the Department of Veterans Affairs Medical 
Care Collections Fund available for general purposes of the 
medical care appropriation, including administrative costs 
associated with collecting such funds. The modifications 
reflect the authorizing legislation which was enacted 
subsequent to House and Senate consideration of the 
appropriations bill. The conference agreement also provides for 
the availability of any moneys deposited in the Fund due to a 
shortfall that is in excess of $25,000,000 below the 
$604,000,000 estimated to be recovered, as authorized in Public 
Law 105-33, the Balanced Budget Act of 1997. Including this 
language on shortfalls is scored as costing $15,000,000 in 
budget authority and$14,000,000 in outlays. The conferees wish 
to make clear that the $15,000,000 is not the amount that would be made 
available in the event of a shortfall, rather it is the cost scored for 
permitting funds deposited by the Secretary of the Treasury to be made 
available from the Fund to the VA for health care. The actual amount of 
the funds made available would depend upon the amount of the shortfall. 
The language proposed by the House in section 108 of the VA 
administrative provisions dealing with a potential shortfall is deleted 
due to the enactment of authorizing legislation and language carried 
under this heading.
      The House report contained a request that the General 
Accounting Office study and report on the effects of Veterans 
Integrated Service Networks (VISN) and Veterans Equitable 
Resource Allocation (VERA) processes and their implementation. 
The report was to be completed in four months. The Secretary 
was directed, pending receipt of the GAO report, to fund all 
VISNs at least at the fiscal year 1996 level. The Senate report 
indicated support for the implementation of VISN and VERA. It 
also expressed opposition to efforts to thwart VERA. The 
conference agreement retains the GAO report requirements, 
modified to direct that the report be completed in nine months. 
The conference agreement does not direct the VA to fund all 
VISNs at least at the fiscal year 1996 level.
      The conferees support the pilot diabetes project in New 
England and Hawaii funded through the Department of Defense. 
The two-year pilot demonstration program shows promise for 
improved and innovative methods of diabetes detection, 
prevention, and care.
      The conferees encourage VA to examine carefully the work 
in Detroit associated with the PARMIN, population and resource 
management information network. The conferees further encourage 
VA to consider setting aside an appropriate amount for the 
development and analytical work associated with the PARMIN 
system, and have the VA report back to the Committees on 
Appropriations as to the viability of this project within 120 
days of enactment of this Act.

                    MEDICAL AND PROSTHETIC RESEARCH

      Appropriates $272,000,000 for medical and prosthetic 
research, instead of $292,000,000 as proposed by the House and 
$267,000,000 as proposed by the Senate. The conference 
agreement includes $10,000,000 for research into Parkinson's 
disease. The VA is to report to the Committees on 
Appropriations with detailed plans on how it plans to spend 
these research funds.
      Deletes language proposed by the House and stricken by 
the Senate earmarking $25,000,000 of the appropriation for 
medical research relating to Gulf War illnesses afflicting 
Persian Gulf veterans. The committee of conference is concerned 
with illnesses reported by some Gulf War veterans. However, the 
VA indicates that it is not possible to utilize effectively 
$25,000,000 for such research. The conferees agree that the VA 
is to utilize $12,500,000 of the appropriation for such 
purposes, and to submit information with the operating plan on 
how the funds will be spent. The conferees note that the 
Federal Government is also spending money on this effort in the 
Department of Defense, the National Institute of Environmental 
Health Sciences, and the Centers for Disease Control.

      MEDICAL ADMINISTRATION AND MISCELLANEOUS OPERATING EXPENSES

      Appropriates $59,860,000 for medical administration and 
miscellaneous operating expenses, instead of $60,160,000 as 
proposed by the House and the Senate. The decrease of $300,000 
is a general reduction from the budget request, subject to 
approval in the operating plan. Additional information on the 
reduction can be found in this report under the general 
operating expenses account.

                      Departmental Administration

                       GENERAL OPERATING EXPENSES

      Appropriates $786,135,000 for general operating expenses, 
instead of $853,385,000 as proposed by the House and 
$786,385,000 as proposed by the Senate. This amount includes 
the following changes to the budget request:
      -$68,000,000 requested to fund compensation and pension 
examinations from the general operating expenses appropriation. 
Funds for these purposes continue to be included in the medical 
care account.
      +$8,000,000, subject to approval in the operating plan, 
for activities such as higher than anticipated contracting 
costs to ensure compliance with Year 2000 computer problems, 
retaining Veterans Benefits Administration staff to improve the 
timeliness of processing veterans claims, development and 
implementation of capacities that will enable effective 
Department-wide strategic planning and management, information 
technology priorities delineated in the recent National Academy 
of Public Administration report, and other priorities 
recommended by NAPA. Consideration should be given to 
reprogramming funds from activities identified by NAPA as lower 
priority, such as VETSNET. The VA should consider this a one-
time adjustment to address on-going concerns. Future budget 
requests are to include adequate funds for administrative 
costs.
      -$150,000 from the $3,630,000 requested for the Office of 
the Secretary.
      -$100,000 from the $2,373,000 requested for the Office of 
the Assistant Secretary for Congressional Affairs.
      The conferees are concerned about the responsiveness of 
the Department of Veterans Affairs to Congressional inquiries 
regarding the implementation of the VERA system. The committee 
of conference directs the Department to communicate with 
Congress on the development of this new allocation system, as 
well as all other matters of interest, in a timely and 
informative manner. The conferees are particularly disturbed by 
the implementation of the VERA system within VISN 4. It is the 
understanding of the conferees that the VA failed to provide 
any information regarding the 40 different funding scenarios 
that were run in VISN 4 before deciding on a final allocation. 
Further, some hospitals within VISN 4 received allocations 
above their budget request, while some hospitals were targeted 
for cuts. The conferees are concerned that no satisfactory 
justification for this discrepancy has been provided. 
Additionally, the committee of conference understands that 
harsh and unfair personnel policies have been implemented in at 
least one hospital within VISN 4. The conferees emphasize that 
such activity will not be tolerated.
      In an effort to address these issues, the conferees 
expect the Department to provide a full and detailed report, 
not later than December 15, 1997, to the Committees on 
Appropriations. This report should include but not be limited 
to: a complete explanation of the funding allocation within 
VISN 4, including all 40 funding scenarios in the Stars and 
Stripes Health Care Network, the specific methodology used to 
reach the final allocation within the VISN 4 network, a 
detailed justification for any funding increases or decreases 
provided to any hospital within VISN 4 throughout fiscal year 
1997, and a detailed evaluation of the formulas and funding 
methodology used for the allocation of resources during fiscal 
year 1997.
      Finally, the Secretary, the Assistant Secretary for 
Congressional Affairs, and the Under Secretary for Health are 
immediately to take appropriate action to ensure that the 
agency is more responsive to Congressional inquiries, and that 
responses to requests for information are timely and provide 
clear, specific, and forthcoming explanations. The committee of 
conference directs that $3,480,000 will be available for the 
Office of the Secretary, a reduction of $150,000 below the 
budget request. An amount of $2,273,000 will be available for 
the Office of the Assistant Secretary for Congressional 
Affairs, a $100,000 reduction below the budget request. The 
conferees direct that none of the reduction is to be applied to 
the Congressional liaison offices. An amount of $59,860,000 
will be made available for the medical and miscellaneous 
operating expenses account, a decrease of $300,000 below the 
budget request. The total amount of these savings, $550,000, 
will be provided as an increase to the medical care account for 
providing health care to veterans.
      Deletes language proposed by the House and stricken by 
the Senate enabling compensation and pension medical 
examinations to be directly funded from Veterans Benefits 
Administration resources. Such exams will continue to be funded 
from the medical care appropriation.
      Inserts language proposed by the House and stricken by 
the Senate prohibiting the VA from proceeding with the 
relocation of loan guaranty divisions of the Regional Office in 
St. Petersburg, Florida to Atlanta, Georgia. The conferees do 
not believe the VA has adequately justified the proposed 
relocation. Any future relocation proposal should include a 
detailed cost-benefit analysis including comparison of savings 
for the cost of space and personnel.

         Veterans Housing Benefit Program Fund Program Account

      Adds technical change to the bill language for the 
Veterans Housing Benefit Program Fund Program Account 
facilitating the transition during fiscal year 1998 from the 
previous direct and guaranteed housing loan program accounts to 
the new appropriation. These provisions have recently been 
requested by the VA, but were not included in either the House 
or Senate bills.

                      Construction, Major Projects

      Appropriates $177,900,000 for construction, major 
projects, instead of $159,600,000 as proposed by the House and 
$92,800,000 as proposed by the Senate. The conference agreement 
includes the following changes from the budget estimate:
      +$26,300,000 for construction of an ambulatory care 
addition at the Asheville, North Carolina VA Medical Center.
      +$21,100,000 for construction of an ambulatory care 
addition at the Lyons, New Jersey VA Medical Center.
      +$7,700,000 for the ward renovations for patient privacy 
project at the Omaha, Nebraska VA Medical Center.
      +$26,000,000 for the environmental improvements project 
at the Waco, Texas VA Medical Center.
      +$4,000,000 for the columbarium component of the 
development and improvement project at the National Memorial 
Cemetery of Arizona. This amount is in addition to the 
$9,100,000 requested and included in the total for major 
construction for the development and improvement of this 
cemetery project.
      +$12,400,000 for the patient privacy/environmental 
improvements project at the Pittsburgh, Pennsylvania VA Medical 
Center.
      +$900,000 for planning of a new national cemetery in 
Oklahoma City, Oklahoma.
      Inserts language proposed by the Senate making 
$32,100,000 earmarked in the 1997 Appropriations Act for a 
replacement hospital at Travis Air Force Base available to 
implement the recommendations contained in the final report 
entitled ``Assessment of Veterans' Health Care Needs in 
Northern California,'' modified to make such funds generally 
available for major construction projects approved in the 
budgetary process. This $32,100,000 together with $38,700,000 
provided in previous Appropriations Acts for the replacement 
for the hospital at Martinez, makes a total of $70,800,000 
available for capital funding for construction projects in 
northern California. Instead of a replacement hospital to be 
built at David Grant Medical Center at Travis Air Force Base, 
the VA recommends capital funding for a project in northern 
California which consists of the following elements:
      $48,000,000 to renovate and add to the existing McClellan 
Hospital at Mather Field, Sacramento, California, for VA 
inpatient and outpatient services.
      $13,500,000 to construct a new VA outpatient clinic at 
Travis Air Force Base, Fairfield, California.
      $3,100,000 to upgrade the existing outpatient clinic at 
the former Mare Island Naval Shipyard, Vallejo, California, for 
a VA outpatient clinic.
      $3,200,000 to upgrade the existing VA outpatient clinic 
at Martinez, California, and
      $3,000,000 to develop new VA outpatient clinics at 
Auburn, Chico, Eureka, and Merced, California.
      In addition to these capital plans, the VA has reached 
agreement with the Department of Defense about the Air Force 
making available up to 100 beds at David Grant Medical Center 
to provide inpatient care associated with the VA outpatient 
clinic to be built there. The conferees understand that the VA 
will pursue contracting arrangements with community health care 
facilities in Martinez and Redding, California, to improve 
access to inpatient services for veterans in those areas.
      The conferees agree with the utilization of the 
$70,800,000 in previously appropriated funds for the 
construction of facilities in northern California as proposed 
by the VA and outlined in this statement. The conferees agree 
with increasing to 100 the number of inpatient beds at Travis, 
and contracting the community health care facilities in 
Martinez and Redding for inpatient services. This plan will 
provide better access to health care services for the veterans 
in northern California and save funds.
      The conferees recognize that the cost estimates are 
tentative and expect the VA to notify the Committees on 
Appropriations of any changes in the cost estimates for the 
individual components of this single project prior to 
proceeding to construction bid. The conferees also recognize 
that the majority of the plan requires authorization by the 
legislative committees, and anticipate that the construction 
authorization process will proceed in a timely manner so as to 
benefit veterans in northern California.
      Deletes language proposed by the House and the Senate 
requiring the General Accounting Office to review and report on 
construction projects where obligations are not incurred within 
prescribed time limitations. The VA is still required to report 
all such delays in obligating major construction funds to the 
Committees on Appropriations.

                      construction, minor projects

      Appropriates $175,000,000 for construction, minor 
projects, instead of $176,500,000 as proposed by the House and 
$166,300,000 as proposed by the Senate. The amount provided 
includes funds for the following activities:
      +$1,500,000 for the expansion of the existing National 
Cemetery in Mobile, Alabama.
      +$1,500,000 to increase the number of niches at the 
columbarium at the National Memorial Cemetery of the Pacific by 
5,000.
      The conferees urge the VA to utilize the balance of the 
addition to increase funding for converting inpatient space to 
outpatient activities use.
      The conferees note the recent request for approval of a 
reprogramming request of construction, major projects funds to 
complete the third floor of the Regional Office in Jackson, 
Mississippi. The proposed reprogramming request of $1,000,000 
for the project in Jackson is approved.

       grants for construction of state extended care facilities

      Appropriates $80,000,000 for grants for construction of 
State extended care facilities as proposed by the Senate, 
instead of $54,500,000 as proposed by the House.

                       administrative provisions

      Deletes language proposed by the House and stricken by 
the Senate in section 108 assuring that, upon enactment of 
legislation establishing the Medical Collection Fund, 
$579,000,000 shall be available for veterans medical care if a 
shortfall in recoveries in excess of $25,000,000 occurs. The 
enactment of authorizing legislation and language carried under 
the medical care appropriation provide such assurance. The 
committee of conference wishes to make clear that the VA is 
expected to take all actions necessary to meet or exceed the 
amount of funds projected to be collected.
      Inserts language proposed by the Senate in section 108 
restoring the authority of the VA to request waivers of the 
home residency requirement for doctors employed at VA medical 
facilities on J-1 visas.
      Deletes language proposed by the Senate in section 109 
limiting the use of the locality pay differential to provide a 
pay increase to an employee transferred as a result of charges 
of sexual harassment. The conferees wish to make clear that the 
VA Secretary is to take all appropriate steps to ensure that a 
``zero tolerance'' policy toward sexual harassment is 
implemented in all VA facilities and offices, including the 
strongest possible sanctions against employees engaging in such 
practices.
      Inserts language, section 109, extending the availability 
of previously appropriated funds for a capital lease. This 
administrative provision was not included in either the House 
or Senate bills. Without this language, certain funds for a 
multi-year capital lease would lapse and the VA would be 
required to, in effect, pay twice for the lease.

         TITLE II--DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

                       Public and Indian Housing

                        housing certificate fund

      Appropriates $9,373,000,000 for the housing certificate 
fund instead of $10,393,000,000 as proposed by the House and 
$10,119,000,000 as proposed by the Senate. Of this amount, 
$8,180,000,000 is provided for expiring or terminated section 8 
project-based and tenant-based subsidy contracts instead of 
$9,200,000,000 as proposed by the House and $8,666,000,000 as 
proposed by the Senate. Additionally, $850,000,000 is provided 
for section 8 amendments as proposed by the House instead of 
$1,110,000,000 as proposed by the Senate. Finally, $40,000,000 
is earmarked for section 8 certificates and vouchers necessary 
to relocate any nonelderly, disabled persons and their families 
who choose to move from a project designated for elderly 
persons only, as proposed by the Senate, rather than 
$50,000,000 as proposed by the House. Language is included to 
make the requirements for using these funds more flexible. 
Additional language is included to clarify that eligible 
residents may receive section 8 enhanced vouchers, also known 
as ``sticky'' vouchers, if an owner of the property chooses to 
prepay the outstanding indebtedness as authorized under the 
Low-Income Housing Preservation and Resident Homeownership Act 
of 1990 (Preservation Program or LIHPRHA).

                 section 8 reserve preservation account

      The conferees agree to provide HUD with authority to 
maintain a section 8 Reserve Preservation Account for the 
purpose of collecting recaptured excess section 8 reserve 
funds.

               annual contributions for assisted housing

      The conferees agree to rescind $550,000,000 of recaptured 
section 8 reserve funds.

                      public housing capital fund

      The Senate proposed language setting aside funds for the 
Economic Development and Supportive Services (EDSS) program 
within the Public Housing Capital Fund. The conferees have 
instead included this language within the Community Development 
Block Grants (CDBG) account as proposed by the House. Language 
is added to the Public Housing Capital Fund account to clarify 
that HUD may spend up to $5,000,000 for the Tenant Opportunity 
Program as proposed by the Senate.

             drug elimination grants for low-income housing

      Appropriates $310,000,000 for the Drug Elimination Grants 
program, including $20,000,000 for the ``New Approach Anti-Drug 
Program,'' instead of funding this new program with a 
$30,000,000 set-aside within the CDBG account, as proposed by 
the Senate. The House did not appropriate funds for this 
purpose.
      The ``New Approach Anti-Drug Program'' authorizes HUD to 
make competitive grants to entities managing or operating 
public housing developments, federally assisted multifamily 
housing developments or other multifamily housing developments 
for low-income families supported by non-Federal governmental 
entities or nonprofits. The funds may be used to provide, 
augment, or assist in the investigation and/or prosecution of 
drug-related criminal activity in and around low-income 
housing, and to provide assistance for capital improvements 
directly related to security. The conferees note that none of 
the funds under this account should be used to reduce the local 
cost of and responsibility for law enforcement activities with 
Federal funding.
      Appropriates $10,000,000 for the Office of Inspector 
General for Operation Safe Home as proposed by the House 
instead of $5,000,000 as proposed by the Senate.

     revitalization of severely distressed public housing (hope vi)

      Appropriates $550,000,000 to revitalize severely 
distressed public housing as proposed by the Senate instead of 
$524,000,000 as proposed by the House. Of the total amount 
appropriated, $10,000,000 is provided for technical assistance 
as proposed by the Senate instead of $5,000,000 as proposed by 
the House. Additionally, as proposed by the Senate, a new 
demonstration to demolish obsolete elderly public housing 
projects is funded at $26,000,000 rather than $50,000,000 as 
proposed by the Senate, with a specific set-aside of up to 
$10,000,000 for Heritage House in Kansas City, Missouri.
      The conferees direct HUD to provide an evaluation of the 
current status of the HOPE VI program and report to Congress by 
June 30, 1998. This report should identify and analyze public 
housing facilities which are eligible for funding as obsolete 
public housing under the new demonstration program, and should 
include recommendations on innovative approaches to 
revitalizing this housing so it meets the special needs of the 
elderly and the disabled. Finally, the conferees request HUD to 
advise the Congress on the current extent, status, and cost of 
deferred maintenance for the entire public housing stock, and 
to include recommendations on innovative ways for public 
housing agencies to address more effectively these maintenance 
needs through the Public Housing Capital Fund and through other 
funding sources and approaches.

                  native american housing block grants

      Appropriate $600,000,000 for Native American Housing 
Block Grants instead of $650,000,000 as proposed by the House 
and $485,000,000 as proposed by the Senate.
      The conferees agree to provide $5,000,000 for the loan 
guarantee program authorized under section 601 of the Native 
American Housing Assistance and Self-Determination Act as 
proposed by the Senate. The House did not provide funds for 
this program. Like the Native American Housing Block Grants 
program, the section 601 program is less than one year old. The 
program was developed to provide Native Americans the ability 
to gain access to private investment and capital from financial 
institutions, builders, and nonprofits. This access is 
necessary if tribes are to improve their economic conditions 
and reduce housing shortages. At this time, however, few tribes 
have the financial expertise to utilize the section 601 program 
effectively. Therefore, for fiscal year 1998, HUD is directed 
to provide these funds on a demonstration basis to tribes that 
have experience with complex financial transactions and to 
study carefully their use so that lessons learned may be 
incorporated into regulations regarding implementation of this 
program throughout Indian areas.

           indian housing loan guarantee fund program account

      Appropriates $5,000,000 for the cost of guaranteed loans 
instead of $3,000,000 as proposed by the House and $6,000,000 
as proposed by the Senate. This amount will subsidize total 
loan principal not to exceed $73,800,000.

           capital grants/capital loans preservation account

      Appropriates $10,000,000 for Capital Grants/Capital Loans 
Preservation, instead of no funds, as proposed by the House. 
The Senate proposed to fund prepayments with any excess 
interest reduction payment funds and included additional 
reforms to the existing program.
      To compensate organizations that incurred costs of 
appraisals and preparing plans of action, the conferees agree 
to provide $10,000,000. However, the conferees do not intend to 
imply that any costs associated with this program constitute an 
obligation of HUD. The award of close-out costs are to be 
determined in the sole discretion of the Secretary.
      In addition, the conferees emphasize that adequate 
funding is provided under the section 8 contract renewal 
account to provide enhanced vouchers to eligible low- or 
moderate-income families residing in a federally-assisted 
project eligible for the Preservation program on the date of 
the prepayment of voluntary termination.

                   Community Planning and Development

              housing opportunities for persons with aids

      Includes language authorizing HUD to provide grants, of 
no more than $250,000, to nonprofit organizations that deliver 
meals to homebound persons who suffer from acquired 
immunodeficiency syndrome, as proposed by the House. The Senate 
did not include this provision.

                   community development block grants

      Appropriates $4,675,000,000 for the Community Development 
Block Grants program, instead of $4,600,000,000 as proposed by 
the House and Senate, to avert decreases in funding allocations 
that may be caused by the increased number of set-asides. For 
the Economic Development and Supportive Services Program, 
$55,000,000 is provided, including a set-aside of up to 
$5,000,000 for the Moving to Work program. Within the 
$55,000,000 provided for economic development and supportive 
services, the conferees have specified that no less than 
$7,000,000 shall be used for grants for service coordinators 
and congregate services for the elderly and disabled. The 
conferees understand this amount to be sufficient to renew all 
service coordinator and congregate services grants expiring in 
fiscal year 1998, and intend that all such grants be renewed 
except in cases where HUD has a specific reason (such as poor 
performance by the grantee or lack of continuing need) not to 
renew a particular grant. The conferees emphasize that the 
$7,000,000 is not a ceiling or target for spending on service 
coordinators and congregate services, but rather simply an 
absolute floor to ensure that sufficient funding is reserved 
for renewals before other allocations are made. The conferees 
consider service coordinators and other supportive services to 
be valuable tools for promoting self-sufficiency and improving 
the quality of life of elderly and disabled residents of public 
and assisted housing.
      For grants pursuant to section 107, the conferees provide 
$32,000,000 instead of $25,100,000 as proposed by the House and 
$30,000,000 as proposed by the Senate, and $7,500,000 for the 
Community Outreach Partnership Program instead of $11,500,000 
as proposed by the House and $12,500,000 as proposed by the 
Senate. Targeted set-asides within these accounts are moved to 
the Economic Development Initiative program.
      Additionally, the conferees agree to appropriate 
$16,700,000 for grants to self-help housing provided pursuant 
to section 11 of the Housing Opportunity Program Extension Act 
of 1996, as proposed by the House; $35,000,000 for YouthBuild 
as proposed by the Senate rather than $30,000,000 as proposed 
by the House; and $15,000,000 for Capacity Building for 
Community Development and Affordable Housing, as authorized 
under section 4 of the HUD Demonstration Act of 1993, rather 
than $30,000,000 as proposed by the Senate. The House did not 
provide funds for this program. Language was included to limit 
these funds to the original grantees under section 4.
      In providing $35,000,000 for YouthBuild, the conferees 
have demonstrated that they support the maintenance and 
expansion of the YouthBuild program. However, in order to 
promote a comprehensive approach for supporting and expanding 
YouthBuild, the Secretary is directed to coordinate with the 
Secretaries of Labor, Health and Human Services, and Education, 
and the Attorney General, as well as the Directors of School-
to-Work Opportunities, the Corporation for National and 
Community Service, and the Job Corps, in conjunction with 
YouthBuild USA, in the development and implementation of a plan 
for expansion of YouthBuild. Youth Build is a comprehensive 
program that has relevance for all of these agencies.
      Appropriates $138,000,000 for the Economic Development 
Initiative instead of $50,000,000 as proposed by the Senate and 
$40,000,000 as proposed by the House. Targeted grants are 
provided for the following special projects:
            --$3,000,000 to the City of Highland, California, 
        to redevelop the Fifth Street Bridge;
            --$50,000 to the Cheltenham Township in Cheltenham, 
        Pennsylvania, to restore the Cheltenham Park;
            --$250,000 to the City of Jacksonville, Florida, 
        for the Tallyrand Redevelopment Project;
            --$15,000 to the Arab Police Department in Arab, 
        Illinois, for the Multidepartmental Training Complex;
            --$1,250,000 to the Stevens Institute of Business 
        Technology in Hoboken, New Jersey, for the construction 
        of the Laboratory for Business Innovation;
            --$250,000 to the County of Inyo, California, to 
        plan and design the Lower Owens River project;
            --$50,000 to Springfield Township, Pennsylvania, 
        for the purpose of Springfield's park restoration;
            --$400,000 for the National Center for Appropriate 
        Technology in Butte, Montana, for the purpose of making 
        improvements in the energy efficiency of low-income 
        housing;
            --$200,000 to Ohio Wesleyan University in Delaware, 
        Ohio, for the purpose of renovating Edgar Hall;
            --$1,000,000 to the Garden State Cancer Center in 
        Belleville, New Jersey, for the purpose of diagnosis, 
        detection, and treatment of cancer utilizing such 
        radioimmunodetection and radioimmunotherapy technology;
            --$250,000 to the County of San Bernardino, 
        California, for economic development at Norton Air 
        Force Base;
            --$50,000 to the City of Norristown Borough in 
        Norristown, Pennsylvania, for recreational park 
        development and open space preservation;
            --$500,000 to Olive Crest Homes and Services for 
        Abused Children in Perris, California;
            --$50,000 to Landsdale Borough in Landsdale, 
        Pennsylvania, for recreational parks development and 
        open space preservation;
            --$200,000 to the National Afro-American Museum in 
        Wilberforce, Ohio, for an educational training program;
            --$150,000 to the City of San Diego, California, 
        for the Beach Area Low Flow Storm Diversion program and 
        safety needs;
            --$1,000,000 to the World Congress on Information 
        Technology in Fairfax, Virginia;
            --$600,000 to the City of Kendleton, Fort Bend 
        County, Texas, for the upgrading of the sewer and water 
        system;
            --$2,000,000 to the Long Island Jewish Medical 
        Center in New Hyde Park, New York;
            --$1,500,000 to the Southeastern Pennsylvania 
        Consortium for Higher Education for the purpose of data 
        collection applicable to social public policy;
            --$50,000 to the Roslyn Boys and Girls Club in 
        Roslyn, Pennsylvania, for the completion of 
        renovations;
            --$500,000 to the Clark County Heritage Center in 
        Springfield, Ohio, for the purpose of acquiring, 
        remodeling, and equipping the Old Marketplace;
            --$1,350,000 to Buena Vista University in Buena 
        Vista County, Iowa, for the Distance Learning Center 
        for Community Outreach and Development;
            --$1,000,000 to the City of Mandeville, Louisiana, 
        to develop a trailhead along the Tammany Trace Rails-
        to-Trails;
            --$2,000,000 to Goodwill Industries of Northeast 
        Pennsylvania in Scranton, Pennsylvania, to renovate and 
        convert the North Scranton Intermediate School into 
        low-income elderly housing;
            --$900,000 to the Museum of Science and Industry in 
        Chicago, Illinois, for the purpose of restoring a U505 
        submarine;
            --$1,750,000 to the Alliance Community Hospital in 
        Alliance, Ohio, for the purpose of developing the 
        Eldercare Complex;
            --$250,000 to the Boys and Girls Club of Greater 
        Washington, D.C., for the purpose of creating a Capitol 
        Hill Youth Anti-Crime program;
            --$450,000 to Rural Enterprises in the City of 
        Durant, Oklahoma, for the purpose of assisting 
        businesses in economically distressed rural areas;
            --$350,000 to the Esperanza Community Housing 
        Corporation, $250,000 to the Central American Resource 
        Center, and $150,000 to the Little Tokyo Service Center 
        in Los Angeles, California, for the purpose of 
        implementing job training, career development, and 
        affordable housing programs;
            --$350,000 to the Plymouth Renewal Center in 
        Louisville, Kentucky, for renovating and providing 
        tutoring, counseling and training programs for at-risk 
        youths;
            --$500,000 to the City of Baldwinville, New York, 
        for the purpose of participating in and revitalizing 
        areas around the Canal Corridor Initiative;
            --$1,000,000 for Pennsylvania Education and 
        Telecommunications Exchange Network (PETE NET), for the 
        purpose of developing a resource-sharing network;
            --$2,000,000 to the Kentucky Highlands Investment 
        Corporation in London, Laurel County, Kentucky, for the 
        purpose of assisting start-up and expanding 
        enterprises;
            --$500,000 for Onondaga Community College, in 
        Onondaga County, New York, for the Applied Technology 
        Center;
            --$1,500,000 to the Geyserville Visitors Center in 
        Sonoma County, California, for the purpose of a 
        visitors and intermodal transportation center;
            --$1,135,000 to the Canaan Community Development 
        Corporation in Louisville, Kentucky, for the purpose of 
        promoting entrepreneurial opportunities in economically 
        deprived areas;
            --$500,000 for the Syracuse Community Health Center 
        in Syracuse, New York, for the purpose of establishing 
        accessible health care centers;
            --$3,220,000 for enlarging and updating the 
        Scarborough Library at Shepherd College in 
        Shepherdstown, WV;
            --$2,000,000 for the State of Maryland for 
        brownfields activities in the Baltimore, MD 
        metropolitan region;
            --$2,000,000 for Ogden Utah, for the economic 
        redevelopment of downtown Ogden, UT;
            --$2,000,000 for the renovation of the Albright-
        Knox Art Gallery in Buffalo, NY;
            --$400,000 for the completion of a regional 
        landfill in Charles Mix County, SD;
            --$2,500,000 for the construction of a building 
        related to the Bushnell Theater in Hartford, CT;
            --$2,500,000 for exhibit and program development at 
        Discovery Place in Charlotte, NC;
            --$600,000 for the development of the West Maui 
        Community Resource Center in West Maui, HI;
            --$1,350,000 for the renovation of the Paramount 
        Theater in Rutland, VT;
            --$250,000 for the Vermont Science Center in St. 
        Albans, VT;
            --$900,000 for the Lake Champlain Science Center in 
        Burlington, VT;
            --$350,000 for Rutland County Community Land Trust 
        to restore low-income housing throughout the Rutland 
        City, Vermont, area;
            --$2,000,000 for the renovation of the Tapley 
        Street Operations Center in Springfield, MA;
            --$2,000,000 to develop abandoned industrial sites 
        in the city of Perth Amboy, NJ;
            --$2,500,000 to the New Mexico Office of Cultural 
        Affairs for the New Mexico Hispanic Cultural Center;
            --$400,000 for the Riverbend Research and Training 
        Park in Post Falls, ID;
            --$2,500,000 in total funding to the University of 
        Missouri including $2,000,000 for the plant genetics 
        research unit and $500,000 for the Delta Research 
        Telecommunications Resource Center;
            --$2,000,000 for the Cleveland Avenue YMCA in 
        Montgomery, AL, to build a cultural arts center;
            --$1,000,000 for Covenant House in Anchorage, AK;
            --$80,000 to complete construction of the senior 
        center in the city of East Providence, Rhode Island;
            --$350,000 for Kids Bridge/New Jersey's Learning 
        Museum to renovate a site in Red Bank, Monmouth County, 
        New Jersey;
            --$650,000 for the East Los Angeles Community Union 
        (TELACU) to revitalize the economy of East Los Angeles, 
        California;
            --$1,000,000 to the Journey Museum in Rapid City, 
        SD, for Native American and minority outreach program;
            --$500,000 for infrastructure development in Puna, 
        HI;
            --$500,000 for a washeteria and related water 
        facilities for Sheldon Point, Alaska;
            --$1,500,000 for training facilities and equipment 
        for Alaska One;
            --$500,000 to Southwest Economic Development 
        Community Development Corporation of Seattle, WA, for 
        Rainer Valley Square;
            --$500,000 for the completion of The CORE Center in 
        Chicago, IL, a free-standing, specialized, outpatient, 
        HIV and Infectious Disease Center;
            --$1,000,000 for training facilities and equipment 
        in the City of Jackson, Mississippi for a downtown 
        multimodal transit center (phase II);
            --$1,000,000 for the Carter County Chamber of 
        Commerce for trade and development activities for 
        Carter County, Montana;
            --$500,000 for expansion of the community health 
        center in Allendale, SC;
            --$600,000 to University of New Orleans in New 
        Orleans, LA, for Revitalization of Central Cities;
            --$1,000,000 for Morgan State University in 
        Baltimore, MD, for studies related to fields of science 
        and mathematics;
            --$2,000,000 for the expansion and start-up costs 
        associated with the expansion of Hofstra University's 
        Business Development Center;
            --$1,000,000 for community development activities 
        at LeClede Town in St. Louis, MO;
            --$1,500,000 for the University of Colorado for its 
        Health Sciences Center;
            --$2,000,000 to the City of Compton, California, 
        for revitalizing distressed areas;
            --$700,000 for the Philadelphia Development 
        Partnership for economic development in Philadelphia, 
        PA;
            --$700,000 for Lehigh Valley, PA, for the 
        development of an aquatic and fitness center;
            --$1,850,000 to Coastal Enterprises, Inc. of 
        Wiscasset, Maine, for its economic development and 
        rural housing programs;
            --$550,000 to the Town of Easthampton, 
        Massachusetts, for the purchase and refurbishment of a 
        new senior center facility;
            --$950,000 to Memorial Health Care, Inc. for 
        establishment of the Community Health Care Center of 
        Central Massachusetts in Worcester, Massachusetts;
            --$950,000 to the Regional Center for Economic, 
        Community, and Professional Development of the 
        University of North Carolina at Pembroke, for 
        construction of a centralized facility;
            --$950,000 to the Turtle Mountain Community College 
        in North Dakota, for completion of the Turtle Mountain 
        Economic Development and Education Complex;
            --$950,000 to the Ruskin Tropical Aquaculture 
        Laboratory in Ruskin, Florida, for construction and 
        equipment for a hatchery, nutrition laboratory and 
        water quality laboratory;
            --$500,000 to the to the City of Murfreesboro, 
        Tennessee, for renovation work at the Bradley Academy;
            --$450,000 to the City of Hobart, Indiana, for 
        water and sewer line installation in the Green Acres 
        subdivision;
            --$2,400,000 to the Metropolitan Miami Action Plan 
        to initiate the revitalization of the Overtown section 
        of Miami, Florida;
            --$1,400,000 to the City of Toledo, Ohio, for the 
        continued revitalization of the downtown, near downtown 
        corridor, and community service centers;
            --$150,000 to ``Friends of George C. Marshall'' of 
        Uniontown, Pennsylvania, for development of the George 
        C. Marshall Memorial Plaza in Uniontown;
            --$400,000 to the Eureka Coal Heritage Foundation, 
        Inc. of Windber, Pennsylvania, for renovation of the 
        Arcadia Theater;
            --$200,000 to Barnesboro Borough, Pennsylvania, for 
        construction of the West Branch Timber Pedestrian 
        Bridge;
            --$550,000 to the Indiana Free Library, Inc. of 
        Indiana, Pennsylvania, to upgrade and renovate the 
        Indiana Free Library;
            --$1,200,000 to the Pacific Science Center in 
        Seattle, Washington, for refurbishment and expansion;
            --$500,000 to the California Science Museum 
        Foundation in Los Angeles for planning and design of 
        the Pacific Environmental Interactive Center;
            --$400,000 to Chicanos Por La Causa for 
        construction of a small business incubator facility in 
        Phoenix, Arizona;
            --$100,000 to the Urban League of Metropolitan St. 
        Louis, Missouri, for purchase and renovation of a 
        building to house its Community Outreach Center;
            --$50,000 to the Harambee Institute of St. Louis, 
        Missouri, for purchase and renovation of an arts 
        education facility;
            --$100,000 to the St. Louis Black Repertory Company 
        of St. Louis, Missouri, for purchase, expansion and 
        renovation of a facility;
            --$100,000 to Better Family Life, Inc. of St. 
        Louis, Missouri, for construction of a new facility to 
        expand existing school-based programs and cultural 
        programs;
            --$50,000 to the Portfolio Gallery and Educational 
        Center of St. Louis, Missouri, for renovation and 
        expansion of its cultural arts training and education 
        facility;
            --$50,000 to the City of Wellston, Missouri, for 
        revitalization of its city hall;
            --$50,000 to the City of Kinloch, Missouri, to 
        assist with the city's housing revitalization efforts;
            --$400,000 to Columbia University in New York City 
        for its Audubon Research Park;
            --$100,000 to the Hebrew Academy for Special 
        Children for its school in Rockland County, New York;
            --$500,000 to Community Build, Inc. of Los Angeles, 
        for development of a business incubator and technology 
        center;
            --$500,000 to Children's Hospital of Oakland, 
        California, for construction of research and laboratory 
        facilities as part of the Martin Luther King, Jr. Plaza 
        project;
            --$500,000 to Nazareth College of Rochester, New 
        York, for library renovation, expansion and equipment;
            --$500,000 to the Center for International Business 
        Education at the University of San Francisco for a 
        model program for training in international commerce, 
        environmental management and business ethics;
            --$500,000 for the Urban League of Greater 
        Cleveland, Ohio, for programs in the area of 
        employment, job training, education, housing, and/or 
        elderly services;
            --$500,000 for the Harvard Community Services 
        Center of Cleveland, Ohio, to expand the 
        intergenerational program involving youth and senior 
        citizens;
            --$300,000 to the Helen S. Brown Senior Citizens 
        Center of East Cleveland, Ohio, to complete the 
        renovation of the Center and for expansion of elderly 
        services;
            --$500,000 to Project East, Inc., DBA East 
        Cleveland Straight Talk, of Shaker Heights, Ohio, for 
        substance abuse counseling and prevention services;
            --$500,000 to the Health and Education Institute of 
        the Olivet Housing and Community Development 
        Corporation of Cleveland, Ohio, for health and 
        education initiatives and services;
            --$600,000 to the City of Grafton, West Virginia, 
        for economic development, community revitalization and 
        housing-related activities;
            --$350,000 to Preston County, West Virginia, to be 
        distributed as follows: $175,000 for Arthurdale 
        Heritage, Inc. and $175,000 for the Kingwood MainStreet 
        program to pursue economic development, downtown 
        revitalization, and historic preservation initiatives;
            --$450,000 to the City of Parkersburg, West 
        Virginia, for economic development and community 
        revitalization efforts;
            --$800,000 to the City of Lorain, Ohio, for health 
        care conversion initiative at the site of the former 
        St. Joseph's Hospital;
            --$200,000 to the Hampton University Aviation 
        Maintenance Training Learning Center of Hampton, 
        Virginia, to continue the development of courseware 
        central to the curriculum;
            --$100,000 to the Diabetes Institute of Hampton, 
        Virginia, to assist in the development of diagnostic 
        and treatment protocols;
            --$50,000 to the Hampton City Schools Achievable 
        Dream Program in Hampton, Virginia; and
            --$500,000 for the Callaway, Florida, Waste Water 
        Expansion Program, to assist with the city's water 
        separation and expansion plans.
      Language is included providing that cleanup and 
redevelopment of areas deemed to be Brownfields are eligible 
activities under CDBG as proposed by the Senate, and to exempt 
a grant for Oglesby, Illinois, from the public comment waiting 
period for an environmental assessment as proposed by the 
House.
      Language is included to create a new rural economic 
development program funded at $25,000,000 instead of 
$42,000,000 as proposed by the Senate. HUD is required to 
target up to $4,000,000 each to areas in Alaska, Missouri, and 
Iowa.
      Additionally, $25,000,000 is included for a Neighborhood 
Initiative program to test whether housing benefits can be 
integrated more effectively with welfare reform initiatives. Of 
the amount made available, $15,000,000 is provided to the 
County of San Bernardino, California, to implement its 
neighborhood initiative program. The County of San Bernardino 
should work with the cities of San Bernardino, Highland, and 
Redlands in designing its initiative.
      The conferees encourage HUD, when awarding the 
Neighborhood Initiative funds, to consider the following 
factors: 1) economic development strategies that utilize local 
community-based partnerships between businesses, non-profits 
and the public sector; 2) neighborhood revitalization efforts 
that integrate sustainable community and building design 
processes; 3) input by residents and other stakeholders; 4) 
creation of homeownership opportunities; 5) links between 
housing programs and welfare reform initiatives in the 
neighborhood; and 6) links between workforce development 
strategies and economic development strategies.
      Finally, a new provision is included that limits the use 
of the $500,000,000 made available under the Community 
Development Block Grants account in the 1997 Emergency 
Supplemental Appropriations Act to not more than $3,500,000 for 
the non-Federal cost-share of a levee project at Devils Lake, 
North Dakota. The conferees direct that the remaining emergency 
CDBG funds originally allocated by HUD for this project be made 
available to the State of North Dakota for other emergency 
activities consistent with the intent of the Supplemental 
Appropriations and Rescissions Act of 1997 (Public Law 105-18). 
In addition, HUD is directed to provide the State of North 
Dakota with a waiver allowing it to use its annual CDBG 
allocation for any remaining portion of the non-Federal cost-
share of this project. Finally, language is included that 
prohibits HUD from providing any additional waivers in excess 
of $100,000 in emergency CDBG funds for the non-Federal cost-
share of projects funded by the Secretary of the Army through 
the Corps of Engineers.
      This provision was added recognizing the serious risk of 
flooding facing the community of Devils Lake while addressing 
serious concerns that emergency CDBG funding has become an 
unregulated fund of Federal dollars which are allocated without 
regard to standard requirements or adequate oversight. The 
conferees are very concerned that the unregulated use of CDBG 
funds will lead to uses which are unintended and bear little 
relation to the broad requirements of the traditional CDBG 
program. The growth of costs and the increasingly broad uses 
for emergency activities associated with both the CDBG program 
and the Federal Emergency Management Agency programs are 
troubling to the conferees, especially because these costs 
threaten the ability of the VA/HUD Appropriations Subcommittees 
to fund adequately the other programs within their 
jurisdiction.

                       brownfields redevelopment

      The conferees have included $25,000,000 to fund HUD's 
contribution to resolving Brownfields problems. This funding is 
to be used for activities eligible under the CDBG program. The 
conferees direct HUD to coordinate activities with other 
agencies responsible for environmental clean up activities and 
to provide the committees of jurisdiction with semi-annual 
reports describing coordinated efforts and an explanation of 
how this program, which has no specific authorization, will be 
implemented.

              empowerment zones and enterprise communities

      Appropriates $5,000,000 for empowerment zones and 
enterprise communities for planning purposes. The Senate 
proposed to fund the program at $25,000,000 and the House did 
not include funds for this purpose. The conferees expect HUD to 
develop guidelines for implementing this program.
      Furthermore, HUD is directed to ensure that the ongoing 
evaluation by Abt Associates evaluates the performance of 
existing EZ/ECs. The study shall measure the success of 
existing EZ/ECs in meeting such objectives as job creation, 
reducing resident unemployment in the EZ/EC, and enhancing 
public safety. The study should provide recommendations for 
improving existing EZ/EC performance and crafting more 
effective guidelines for strategic plans for any possible 
future EZ/ECs.

                  home investment partnerships program

      Appropriates $1,500,000,000 for the HOME program, as 
proposed by the House rather than $1,400,000,000 as proposed by 
the Senate. Of this amount, $20,000,000 is included for Housing 
Counseling as proposed by the Senate rather than $15,000,000 as 
proposed by the House, and $10,000,000 is included for a 
program to demonstrate ways to expand the secondary market for 
non-conforming loans as proposed by the House. The conferees 
underscore their intention that this demonstration focus solely 
on strategies to expand the secondary market for affordable 
home mortgage credit from private lenders. The conferees agree 
that participants in the demonstration should be selected on a 
competitive basis based on the criteria in the statute and 
contained in the House report. It is expected that the 
credibility and impact of the demonstration will be maximized 
to the extent that the Secretary awards priority in the 
selection process to organizations which have the following 
characteristics: 1) statewide or multi-state service areas; 2) 
sophisticated existing data collection capabilities, including 
adequate loan portfolio monitoring and analysis systems; 3) a 
demonstrated strong track record of leveraging public-sector 
funds for secondary market activities, and willingness to match 
funds awarded under this section with non-Federal funds; and 4) 
a mix between rural and urban loans.

                       homeless assistance grants

      Deletes language proposed by the Senate which allows HUD 
to transfer and merge any unobligated balances from Homeless 
programs into a consolidated account. This issue will be 
addressed when a consolidated homeless assistance program is 
authorized and enacted.

                            Housing Programs

                housing programs for special populations

      Includes language authorizing HUD to utilize amounts 
appropriated to these programs to provide supportive services 
as proposed by the Senate. The House did not include such 
language. The conferees believe it is appropriate that 
supportive services provided for persons who live in buildings 
financed with these funds should be paid for from these 
accounts rather than decreasing the scarce supportive services 
funds provided for families residing in public and assisted 
housing.
      The conferees reaffirm report language contained in both 
House and Senate committee reports regarding the Office of 
Manufactured Housing, but have decided against providing a 
separate account for that program office.

                     Federal Housing Administration

             FHA-MUTUAL MORTGAGE INSURANCE PROGRAM ACCOUNT

      Transfers not more than $12,112,000 from amounts derived 
from the FHA-MMI fund to the Office of Inspector General as 
proposed by the Senate instead of transferring $7,112,000 as 
proposed by the House.

                    Policy Development and Research

                        research and technology

      Appropriates $36,500,000 for research and technology 
related to housing issues instead of $39,000,000 as proposed by 
the House and $34,000,000 as proposed by the Senate.
      The conferees have provided a set-aside of $500,000 from 
the Department's Research and Technology account for the 
National Academy of Public Administration (NAPA) to evaluate 
HUD's efforts to implement needed management systems and 
processes. Systems to be evaluated include contracting 
procedures, basic administrative organization, development of 
personnel requirements based on meaningful measures, and HUD's 
compliance with the Government Performance and Results Act. 
This set-aside augments $1,000,000 appropriated under the 1997 
Emergency Supplemental Appropriations Act.
      Currently, the General Accounting Office (GAO) and the 
HUD Inspector General (IG) are reviewing HUD's contracting 
requirements and implementation procedures; therefore, the 
conferees do not intend for NAPA to duplicate the GAO's and/or 
the IG's work. It is intended, however, that NAPA's study will 
complement the other reviews.

                   Fair Housing and Equal Opportunity

                        fair housing activities

      Appropriates $30,000,000 for fair housing activities, 
$15,000,000 of which is for activities under the Fair Housing 
Initiatives Program (FHIP) as proposed by the House instead of 
$10,000,000 for FHIP as proposed by the Senate.

                     Management and Administration

                         salaries and expenses

      Appropriates $1,000,826,000 for salaries and expenses 
instead of $1,005,826,000 as proposed by the House and 
$954,826,000 as proposed by the Senate. This modest decrease 
from the budget request is included to encourage the Secretary 
to be more forthcoming about providing information to Congress 
when it is requested.
      HUD is undergoing Department-wide reorganization to 
improve delivery of services, management, and performance. The 
conferees agree that HUD must reorganize the manner in which it 
operates if it is to survive into the next century. It is the 
strongly held belief of the conferees that HUD must be in a 
position, both programmatically and operationally, to provide 
the highest level of opportunity for Americans to live in 
decent, safe and affordable homes.
      The reorganization plan suggested by HUD involves 
consolidating offices and program functions. Additionally, the 
plan implements Congressional direction to decrease staff 
levels. Because these actions will change the manner in which 
HUD's services are provided, and where they are provided, 
Congress must be kept well-informed about how they are to be 
implemented, how they will impact Congressionally-mandated 
programs, and how they will affect services at a local level. 
Accordingly, the conferees direct HUD to provide the 
information listed below:

                            Submission Date:

      January 15, 1998--1. Cost-benefit analysis of the newly 
created offices, including the Assessment Center, the Section 8 
Center, and the Enforcement Center;
      January 15, 1998--2. Schedule of events--rough estimate 
of dates for plan implementation, including when HUD will 
undertake and complete significant actions (i.e., new offices, 
staff moves);
      Upon submission of President's Budget Request--3. 
Annualized funding projections needed to carry out the 
management plan;
      January 15, 1998--4. Explanation of modernization and 
integration of financial/management information systems and how 
the systems will develop internal controls and improve HUD's 
ability to monitor and measure program performance;
      January 15, 1998--5. Explanation of the resources 
(financial, information, staff) needed to effectively manage 
and operate HUD's core programs; and
      Enactment of VA/HUD Appropriations Measure--6. Legal 
analysis of Dole Amendment applicability to HUD's 
reorganization plan.
      The conferees support the emphasis and function of the 
Department's proposed Enforcement, Assessment, and Section 8 
Centers and do not want to impede these muchneeded reforms. 
However, as the Management 2020 plan involves location decisions, 
including moving staff from Headquarters, until Congress is provided 
with the information listed above, and the committees of jurisdiction 
have had a reasonable opportunity to review and to comment upon this 
information, HUD is directed to take no significant actions that 
involve geographically relocating staff or entering into binding 
commitments for office space, as related to the three new proposed 
center locations: Namely, the Assessment Center, the Enforcement 
Center, and the Section 8 Center.

                      office of inspector general

      Appropriates $66,850,000 for the Office of Inspector 
General as proposed by the House instead of $57,850,000 as 
proposed by the Senate. Of this amount, $16,283,000 is 
transferred from various FHA funds as proposed by the Senate 
instead of $11,283,000 as proposed by the House and $10,000,000 
is provided for Operation Safe Home as proposed by the House 
instead of $5,000,000 as proposed by the Senate.

             office of federal housing enterprise oversight

                         salaries and expenses

      Appropriates $16,000,000 for the Office of Federal 
Housing Enterprise Oversight (OFHEO) rather than $16,312,000 as 
proposed by the House and $15,500,000 as proposed by the 
Senate. The conferees are concerned about OFHEO's growth as a 
bureaucracy instead of as an efficient regulatory office.
      Additionally, the conferees encourage OFHEO to meet its 
primary statutory mission of establishing a balanced and 
effective risk-based capital standard for the Government 
Sponsored Enterprises (GSEs), as required under the Housing and 
Community Development Act of 1992.

                       administrative provisions

      Several provisions included in either the House or Senate 
bills were not adopted by the conferees. Section numbers have 
been re-designated accordingly.
      Section 201. Extends certain public and assisted housing 
reforms for this fiscal year, as proposed by the Senate. The 
House included language regarding minimum rents.
      Section 203. Waives the requirement that the City of 
Oglesby, Illinois, have public hearings concerning an 
environmental assessment, under the Housing and Community 
Development Act of 1974, as proposed by the House.
      Section 204. Extends a provision that provides an 
incentive for refinancing projects with FAF bonds to lower the 
cost of section 8 assistance, as proposed by the Senate.
      Section 206. Reprograms $7,100,000 from an industrial 
park to be used for a Negro Leagues Baseball Museum and jazz 
museum, as proposed by the Senate.
      Section 207. Prohibits prosecution of persons under the 
Fair Housing Act if the person is engaged in lawful activity, 
as proposed by the Senate.
      Section 208. Requires HUD to maintain public notice and 
comment rulemaking, as proposed by the Senate.
      Section 209. Authorizes cleanup and economic development 
of Brownfields as an eligible activity under the CDBG program, 
as proposed by the Senate.
      Section 210. Permits partial payment of claims on 
hospital and health care facilities, as proposed by the Senate.
      Section 211. Extends for one year the FHA single family 
streamlined downpayment program for Alaska and Hawaii as 
proposed by the Senate. In addition, the conferees direct HUD 
to study the proposal to streamline the FHA downpayment formula 
and to explain its impact on the continental United States. The 
study should examine how the proposed downpayment formula would 
favorably or adversely affect each State, how it would impact 
the FHA insurance fund, whether it would improve homeownership 
opportunities for low- and moderate-income families, and 
whether it would cause inappropriate competition by the FHA 
with mortgage insurance companies. The study should be 
completed by March 1, 1998.
      Section 212. Includes language to provide flexibility for 
a HOPE VI project in New York, as proposed by the Senate.
      Section 213. Includes language to provide HUD with 
flexibility to make rehabilitation grants and loans in 
disposing of HUD-owned and HUD-held properties, as proposed by 
the Senate.
      Section 215. Includes language to provide financing 
alternatives to enhanced vouchers in certain section 236 
projects.
      Section 216. Includes language making a technical 
correction to the nursing home insurance program.
      Section 217. Includes language to preserve funding for 
existing HOPWA grantees in the State of Wisconsin to correct an 
anomaly in the formula which can result in the loss of funds 
for a state when incidence of AIDS in a large city increases. 
The conferees reaffirm the direction included in the House 
report for HUD to examine all problems caused by the existing 
HOPWA formula and recommend improvements.
      Section 218. Includes language to cancel the principal 
and interest due on HUD-guaranteed water and sewer bonds issued 
by the Village of Robbins, Illinois.

                    TITLE III--INDEPENDENT AGENCIES

                  American Battle Monuments Commission

                         salaries and expenses

      Appropriates $26,897,000 for salaries and expenses as 
proposed by the House, instead of $23,897,000 as proposed by 
the Senate.

             Chemical Safety and Hazard Investigation Board

                         salaries and expenses

      Appropriates $4,000,000 for the Chemical Safety and 
Hazard Investigation Board as proposed by the Senate. The House 
had provided no funding for the Board.
      The funding provided for fiscal year 1998 will permit the 
Board to begin start-up operations, including the hiring of up 
to 20 employees through the fiscal year. While the conferees 
have agreed to provide funding for the Board, they nevertheless 
remain concerned that the operational costs not become 
excessive over the next few years. Rather, the conferees expect 
the Board to make careful, deliberate decisions with respect to 
the growth and expansion of both operations and staff. The 
conferees anticipate that a substantial increase in 
appropriations in the next few years will not be feasible.

                       Department of the Treasury

              community development financial institutions

   community development financial institutions fund program account

      Appropriates $80,000,000 for the Community Development 
Financial Institutions Fund, instead of $125,000,000 as 
proposed by the House. The Senate did not provide an 
appropriation for this account. The conferees have also 
included in the bill, language restricting the rate of 
consultants hired by the Fund.
      The conferees are aware of and share concerns raised 
regarding implementation of the program. The conferees 
recognize and commend the Department of the Treasury for taking 
significant steps in recent months to improve systems, 
procedures, and policies. The conferees agree that action 
should be taken to ensure, among other things, that: (a) 
appropriate and timely documentation is provided for the awards 
process and the evaluation and selection of applicants to 
receive assistance; (b) all successful applicants are selected 
pursuant to uniform standards using an objective evaluation 
system; (c) no individual involved in the evaluation and 
selection of applicants has a conflict or apparent conflict of 
interest; (d) none of the funds provided for this program are 
used for contracts for management or policy consulting 
services, except for contracts entered into in accordance with 
federal acquisition regulations with firms having recognized 
management or policy consulting expertise, or with individuals 
or firms having recognized expertise in community development 
lending or investing or services related to review of 
applications for grants and other awards from the Fund; and (e) 
ensure sound and impartial administration. The conferees urge 
the Department to remain diligent in working on systems to 
ensure proper accountability and management of the Fund's 
programs.
      In place of the General Accounting Office report 
requested by the Senate, the conferees agree that the GAO 
should conduct a review of the CDFI program and report to the 
Congress on the implementation and effectiveness of the program 
in achieving its goals and objectives.

                   Consumer Product Safety Commission

                         salaries and expenses

      Appropriates $45,000,000 for the Consumer Product Safety 
Commission as proposed by the Senate instead of $44,000,000 as 
proposed by the House.

             Corporation for National and Community Service

       national and community service programs operating expenses

      Appropriates $425,500,000 for national and community 
service programs operating expenses, instead of $200,500,000 as 
proposed by the House and $420,500,000 as proposed by the 
Senate.
      Limits funds for administrative expenses to not more than 
$27,000,000, instead of $29,000,000 as proposed by the House 
and $25,000,000 as proposed by the Senate. This amount includes 
funds necessary to administer the National Service Trust.
      Limits funds for educational awards to not more than 
$70,000,000, of which not to exceed $5,000,000 shall be 
available for national service scholarships for high school 
students performing community service, instead of $69,000,000 
and $10,000,000, respectively, as proposed by the House and 
$59,000,000 and zero, respectively, as proposed by the Senate. 
The amount for educational awards is higher than the amount in 
either the House or Senate bill and results from the increase 
in funding for AmeriCorps grants. The conferees request that 
the Corporation provide to the Committees on Appropriations a 
report by June 30, 1998, on the feasibility of privatizing the 
National Service Trust, including the costs of privatization 
and recommendations on how privatization could be implemented.
      Limits funds for AmeriCorps grants to not more than 
$227,000,000, instead of $201,000,000 as proposed by the House 
and $215,000,000 as proposed by the Senate.
      Inserts language limiting funds for national direct 
programs to not more than $40,000,000 as proposed by the 
Senate. The House did not propose a limitation on national 
direct programs.
      Deletes language proposed by the Senate earmarking 
$20,000,000 of the appropriation for the America Reads 
Initiative. The House did not propose such an earmarking. The 
conference agreement includes $25,000,000 for literacy and 
mentoring activities.
      Deletes language proposed by the Senate restricting other 
funds available to the Corporation from being used for 
personnel compensation and other administrative expenses of 
certain offices. The House did not propose such language. While 
the conferees are providing this additional flexibility, the 
Corporation is expected to provide a detailed explanation in 
the operating plan on how it plans to coordinate the use of 
administrative funds from any other agency, office or source to 
administer its operations.

                      office of inspector general

      Appropriates $3,000,000 for the office of Inspector 
General as proposed by the Senate, instead of $2,000,000 as 
proposed by the House.

                       Court of Veterans Appeals

                         salaries and expenses

      Appropriates $9,319,000 for salaries and expenses as 
proposed by the House, instead of $9,320,000 as proposed by the 
Senate.

                    Environmental Protection Agency

      Appropriates $7,363,046,000 for the Environmental 
Protection Agency for fiscal year 1998 instead of 
$7,205,077,000 as proposed by the House and $6,975,920,000 as 
proposed by the Senate. The conferees note that the budget 
agreement between the Congress and the Administration called 
for the ``operating programs'' of the Agency to be funded at a 
level totaling just over $3,400,000,000. The funding provided 
for these operating programs in this agreement totals nearly 
$3,350,000,000, thus meeting the spirit of this agreement.
      As in past years, the conferees agree that the Agency 
must limit transfers of funds between programs and activities 
to not more than $500,000, except that for the Environmental 
Programs and Management account only, the Agency may transfer 
funds of not more than $500,000 between programs and activities 
without prior notice to the Committees, and of not more than 
$1,000,000 without prior approval of the Committees. No changes 
may be made to any account or program element, except as 
approved by the House and Senate Committees on Appropriations, 
if it is construed to be policy or a change in policy. Any 
activity or program cited in the joint explanatory statement of 
the committee of conference shall be construed as the position 
of the conferees and should not be subject to reduction or 
reprogramming without prior approval. It is the intent of the 
conferees that all carryover funds in the various 
appropriations accounts are subject to normal reprogramming 
requirements as defined herein.

                         science and technology

      Appropriates $631,000,000 for science and technology 
instead of $629,223,000 as provided by the House and 
$600,000,000 as provided by the Senate. The conferees have 
included new bill language which provides $49,600,000 for a 
particulate matter research program in lieu of language 
contained in the House bill.
      The conferees have agreed to the following increases to 
the budget request:
      1. $1,250,000 for continuation of the California Regional 
PM 10 & 2.5 air quality study.
      2. $2,500,000 for EPSCoR.
      3. $500,000 for continuation of a study of livestock and 
agricultural pollution abatement at Tarleton State University.
      4. $3,000,000 for the Water Environment Research 
Foundation.
      5. $2,000,000 for continued research on urban waste 
management at the University of New Orleans.
      6. $1,300,000 for continued oil spill remediation 
research at the Louisiana Environmental Research Center at 
McNeese State University.
      7. $2,000,000 for the Mickey Leland National Urban Air 
Toxics Research Center. The conferees recognize the value of 
the air toxics research supported by the Mickey Leland National 
Urban Air Toxics Research Center in Houston, Texas. However, 
the conferees are aware that the Center has developed its own 
method to fill vacancies on the Board of Directors. Because the 
appointment of the Board of Directors provides for 
Congressional oversight and assures the continued success of 
the Center and its undertakings, it is the intent of the 
conferees that the Leland Center immediately revise its method 
of appointment of Directors consistent with law and with the 
original Congressional intent regarding appointment of 
Directors.
      8. $4,000,000 for the American Water Works Association 
Research Foundation, including $1,000,000 for continued 
research on arsenic.
      9. $3,000,000 for the National Decentralized Water 
Resource Capacity Development Project, in coordination with 
EPA, for continued training and research and development.
      10. $1,500,000 for the Integrated Petroleum Environmental 
Consortium project, to be cost-shared.
      11. $1,750,000 for continued research at the 
Environmental Lung Center of the National Jewish Medical and 
Research Center in Denver.
      12. $6,000,000 for continued research of the Salton Sea, 
including $1,000,000 to the University of Redlands and 
$5,000,000 for the Salton Sea Authority.
      13. $2,000,000 for research on treatment technologies 
relating to perchlorate within the Crafton-Redlands Plume, to 
be conducted through the East Valley Water District, 
California.
      14. $2,000,000 for the Lovelace Respiratory Institute to 
establish a National Environmental Respiratory Center to 
coordinate research and information transfer.
      15. $1,000,000 for the Center for Air Toxic Metals at the 
Energy and Environmental Research Center.
      16. $1,000,000 for the Texas Regional Institute for 
Environmental Studies to identify and test new cost-effective 
environmental restoration technologies.
      17. $1,000,000 for the Institute for Environmental and 
Industrial Science to develop new technologies for controlling 
radioactive waste, solid waste, and other emissions.
      18. $500,000 for the clean air status and trends network.
      19. $1,500,000 for Johns Hopkins University's School of 
Hygiene and Public Health to establish a National Center for 
Environmental Toxicology and Epidemiology.
      20. $1,000,000 to establish the Center for Estuarine and 
Coastal Ocean Environmental Research to coordinate and further 
ongoing coastal and environmental research being conducted at 
the University of South Alabama.
      21. $2,000,000 for continuation of an initiative to 
transfer technology developed in the federal laboratories to 
meet the environmental needs of small companies in the Great 
Lakes region, to be accomplished through a NASA-sponsored 
Midwest regional technology center working in collaboration 
with an HBCU from the region.
      22. $6,000,000 for the Mine Waste Technology Evaluation 
Program and Berkeley pit integrated demonstration activities 
through the National Waste Technology Testing and Evaluation 
Center.
      23. $1,500,000 to support external research on 
Pfiesteria. The conferees are concerned about the recent rash 
of fish killings and human sickness due to a marine biotoxic 
outbreak labeled Pfiesteria, in east coast waterways. In 
complementing current local and state efforts, the conferees 
direct a national research program that would evaluate 
competitive, peer-reviewed proposals to understand the causes, 
mechanisms, and health and environmental effects of Pfiesteria. 
Additional funding is appropriated in the environmental 
programs and management account.
      The conferees have agreed to the following reductions 
from the budget request:
      1. $5,078,000 from the Climate Change program.
      2. $6,218,000 from the Global Change program.
      3. $2,000,000 from the Advanced Measurement Initiative.
      4. $8,000,000 from the new Environmental Monitoring for 
Public Access and Community Tracking program.
      5. $5,000,000 from graduate academic fellowships.
      6. $7,000,000 from advanced funding of a planned fiscal 
year 1998 lease requirement and savings due to a rate 
recalculation for the Working Capital Fund.
      7. $21,273,400 as a general reduction.
      The conferees are aware that orimulsion, a mixture of 
bitumen and water, is being considered for generating 
electricity in the United States. While orimulsion has been 
used in several countries including Japan, China, Italy and 
Canada's maritime provinces, it has not been utilized within 
the United States. Because little is known about the risks 
associated with the introduction of this new product, the 
conferees direct EPA to initiate a research activity to provide 
better scientific data on the qualities and characteristics of 
this product and the potential environmental impact of its 
introduction.
      In addition to the funds specifically provided for 
perchlorate research within the Crafton-Redlands Plume, the 
conferees direct the Agency to work with the Department of 
Defense, the National Institute of Environmental Health 
Sciences, and other appropriate federal and state agencies to, 
(1) assess the state of the science on the health effects of 
perchlorates on humans and the environment and the extent of 
perchlorate contamination of our nation's drinking water 
supplies, and, (2) make recommendations to the House and Senate 
Committees on Appropriations within six months of enactment of 
this Act on how this emerging problem might be addressed.
      The conferees note the important ongoing research 
activities at EPA to develop a comprehensive view of the air 
quality impacts resulting from swine confinement operations. 
The EPA is directed to coordinate these research activities 
working in conjunction with those efforts currently underway at 
the Agricultural Research Service and with other public and 
private research efforts.
      Following consultation with the Environmental Protection 
Agency, the National Academy of Sciences, and numerous 
scientific and research and stakeholder groups, the conferees 
have developed a mechanism which, when implemented, will go far 
toward increasing the breadth of knowledge and filling research 
gaps regarding the potential health effects of fine particulate 
matter (PM). The recommendation of the conferees is meant to 
build on the research which has already been planned, is 
underway, or has been completed by EPA, NIEHS, NAS, HEI, and 
numerous other public and private entities, and its success 
will rely on the hard work and continued good will of all 
interested parties.
      Although EPA recently issued a revised standard for PM, 
the Agency also indicated the standard will have no regulatory 
impact until after the next National Ambient Air Quality 
Standards (NAAQS) review, currently planned for 2002. The 
conferees believe a unique opportunity now exists to put into 
place the mechanism to establish a comprehensive, peer-
reviewed, near- and long-term research program which will 
benefit both the Legislative and Executive branches in 
decision-making activities regarding PM in the coming years.
      To this end, the conferees have included bill language 
which specifically provides $49,600,000 for particulate matter 
research, and further provides that within 30 days of enactment 
of this Act, EPA shall enter into a contract or cooperative 
agreement with the National Academy of Sciences (NAS) to 
develop a comprehensive, prioritized, near- and long-term 
particulate matter research program, as well as a plan to 
monitor how this research program is being carried out by all 
participants in the research effort. The conferees intend the 
NAS to develop a near-term research plan within four months of 
execution of the contract with EPA, and expect a long-term plan 
to be completed within twelve months of execution of the 
contract. Both plans should be developed on as close to a 
consensus basis as is practicable following consultation and 
comprehensive discussions with, but not limited to, 
representatives of the EPA, the National Institute of 
Environmental Health Sciences (NIEHS), the Department of Energy 
(DOE), and the National Oceanic and Atmospheric Administration 
(NOAA), as well as representatives from such organizations as 
the Health Effects Institute (HEI), the North American Research 
Strategy for Tropospheric Ozone (NARSTO), the Chemical Industry 
Institute of Technology (CIIT), the Lovelace Inhalation 
Toxicology Research Institute, the American Lung Association, 
the Electric Power Research Institute (EPRI), EPA's Science 
Advisory Board and Clean Air Scientific Advisory Committee, and 
other qualified personnel representing government, industry, 
and the environmental community. Upon completion of the 
research plans, the NAS shall simultaneously provide copies to 
the Congress, to EPA, and to all participating parties.
      It is the intention of the conferees that the plan is to 
be the principal guideline for the Agency's particulate matter 
research program over the next several years. The conferees 
expect the Agency to implement the plan, including the conduct 
of appropriate peer review and the distribution of intramural 
and extramural funds, in a manner which assures that research 
as determined in the plan will proceed in an orderly and timely 
fashion, and according to the priority basis outlined by NAS. 
The conferees also expect the NAS to monitor the implementation 
of the research plan and periodically report to the Congress as 
to the progress of the NAS plan. Should EPA, after its own 
analysis, disagree with any research topic or priority ranking 
as determined in the plan, or with any other aspect of the 
plan, the conferees direct the Agency to provide the Congress 
with a detailed analysis of such a disagreement, as well as 
with a description of what the Agency proposes in lieu thereof. 
EPA is expected to move forward immediately with its PM 
research program as outlined in the fiscal year 1998 budget 
submission. Upon delivery of the NAS research plan, however, 
the conferees expect the Agency and other federal entities as 
listed above to review their ongoing particulate matter 
research activities and, where appropriate, re-focus such 
activities so as to be consistent with the NAS research plan. 
The funds provided above the budget request should be targeted 
to filling research gaps outlined by NAS and not already 
planned for fiscal year 1998.
      In administering the research plan, the conferees expect 
the Agency to be responsible for the timely announcement of all 
requests for research proposals, for the thorough review of 
such proposals, and for the granting and auditing of all funds 
to conduct such research proposals. Given the importance of 
developing and publishing as much new research as possible 
prior to the next NAAQS review planned for PM, the Agency 
should take every step possible to expedite the delivery of 
available research funds for both intramural and extramural 
recipients. Moreover, in the making of specific grants or, in 
the case of other governmental agencies, a cooperative research 
agreement pursuant to the research plan, the Agency should be 
mindful of the various talents and expertise of each of the 
aforementioned organizations or other research grant applicants 
may have so as to maximize to the greatest extent possible the 
quality of the research that is to be conducted.
      The conferees understand that the most immediate, or 
``near-term'' PM research needs include, but are not limited 
to, topics such as toxicological and biological mechanisms, 
source apportionment, human exposure assessment and monitoring, 
ambient measurement methods, and epidemiology. NAS is thus 
expected to focus on these as well as other high priority 
topics as part of its near-term research plan.
      In addition, up to $8,000,000 of the funds provided 
herein are to be used to create up to five university-based 
research centers focused on PM-related environmental and health 
effects. EPA will select these centers through a competitive 
peer review process and will ensure consistency with the final 
research plan formulated by the process outlined above. The 
centers program is intended to help address the most pressing 
unanswered questions involved in the air particulate field. A 
governing criterion for the selection of the proposed centers 
should be their ability to bring together bio-medical and 
public health scientists, engineers, environmental scientists, 
economists, and policy analysts as part of a coordinated and 
comprehensive data analysis and research effort.
      The conferees direct that, prior to completion of the 
research plan, adequate funds be made available to support on 
ongoing effort to conduct a thorough inventory of all federal 
and non-federal research on particulate matter, to initiate key 
term research, and to conduct a thorough reanalysis of all key 
long-term studies relating to particulate matter. Priority in 
the award of grants as outlined in the preceding sentence 
should be given to organizations which are established 
independent research institutes funded in partnership with EPA.
      Finally, the conferees expect that all research data 
resulting from this funding will become available to the 
public, with proper safeguards for researchers' first right of 
publication, for scientific integrity, for individuals 
participating in studies, for proprietary commercial interests, 
and to prevent scientific fraud and misconduct.
      The issue of the new particulate matter standards as 
outlined by EPA in July of this year, and the potential 
regulations that may result from these new standards, has 
resulted in an emotional and politically charged debate 
principally on the potential economic impacts of regulations 
based on the new standard. What has unfortunately been 
diminished in these debates is the almost universal recognition 
that considerable scientific questions relative to particulate 
matter remain to be answered. The conferees recognize that 
while reasonable people may differ as to the interpretation of 
the facts and that different policy judgments may be arrived 
at, sufficient facts are not yet available to proceed with 
future regulations for a new particulate standard. The 
conferees note that this may be the only realistic opportunity 
to enlist the support of both the public and private sectors to 
maximize the use of science so as to better determine the 
answers that will some day guide future regulatory actions 
regarding particulate matter.

                 environmental programs and management

      Appropriates $1,801,000,000 for environmental programs 
and management as proposed by the Senate instead of 
$1,763,352,000 as proposed by the House.
      The conferees have agreed to the following increases to 
the budget request:
      1. $2,500,000 for the Michigan Biotechnology Institute 
for continued development of viable cleanup technologies.
      2. $900,000 for the Lake Wallenpaupack, Pennsylvania 
environmental restoration project.
      3. $372,000 for the Saint Vincent watershed environmental 
restoration project.
      4. $500,000 for continued activities of the Small 
Business Pollution Prevention Center at the University of 
Northern Iowa.
      5. $1,000,000 for the National Estuary Program, including 
$400,000 for Barnegat Bay. In addition, the conferees note 
their support for the full budget request for the Agency's 
South Florida/Everglades initiative, including funding for the 
EPA office in South Florida.
      6. $2,372,000 for the Great Lakes Program. Included in 
the total program level is $14,700,000 for the Great Lakes 
National Program Office.
      7. $250,000 for design for a non-indigenous species 
dispersal barrier in the Chicago shipping and sanitary canal 
pursuant to Sec. 1202 of the National Invasive Species Act, to 
be cost-shared.
      8. $500,000 for continued work on the Ohio River 
watershed pollutant reduction program, including a study of 
dioxin levels in the Basin, to be cost-shared.
      9. $2,000,000 for continuation of the Sacramento River 
Toxic Pollution Control Project, to be cost-shared.
      10. $2,500,000 for a water reuse demonstration project in 
Yucca Valley ($800,000) and a groundwater treatment 
demonstration project in 29 Palms ($1,700,000), California.
      11. $700,000 for ongoing activities at the Canaan Valley 
Institute.
      12. $3,000,000 for the Southwest Center for Environmental 
Research and Policy (SCERP).
      13. $4,000,000 for the National Institute for 
Environmental Renewal to establish a regional environmental 
data center, and to develop an integrated, automated water 
quality monitoring and information system for watersheds 
impacting the Chesapeake Bay.
      14. $500,000 for continuation of the Small Water Systems 
Institute at Montana State University.
      15. $5,325,000 for rural water technical assistance 
activities and groundwater protection bringing the total 
program to $13,325,000 with distribution as follows: $8,200,000 
for the National Rural Water Association; $2,100,000 for Rural 
Community Assistance Program; $400,000 for the Groundwater 
Protection Council; $1,550,000 for Small Flows Clearinghouse; 
$1,000,000 for the National Environmental Training Center; and 
$75,000 for the National Groundwater Foundation.
      16. $2,000,000 for an environmental education center in 
Highland, California.
      17. $3,000,000 for continuation of the New York and New 
Jersey dredge decontamination project.
      18. $1,000,000 for continued work on the water quality 
management plan for the Skaneatles, Otisco and Owasco Lake 
watersheds.
      19. $400,000 for continued work on the Cortland County, 
New York aquifer protection plan.
      20. $300,000 for the NAS to conduct a study of the 
effectiveness of EPA's inspection and maintenance programs.
      21. $400,000 for a non-profit organization to implement 
an action plan to accelerate the international phase-out of 
leaded gasoline.
      22. $2,000,000 for the creation of five small public 
water system technology assistance centers pursuant to section 
1420(f) of the Safe Drinking Water Act, as amended.
      23. $500,000 for a waste water reuse study in the 
Victorville, California area.
      24. $3,400,000 for Lake Weequahic cleanup efforts 
($3,000,000) and water quality initiatives at Lake Hopatcong 
($400,000), New Jersey.
      25. $1,000,000 ($500,000 each) for small public water 
system technology centers at the University of Missouri-
Columbia and at Western Kentucky University.
      26. $3,000,000 to continue the demonstration project 
involving leaking fuel tanks in rural Alaska villages.
      27. $250,000 for the Nature Conservancy of Alaska for 
protection of the Kenai River watershed.
      28. $1,250,000 to continue the onsite wastewater 
treatment demonstration program through the Small Flows 
Clearinghouse, including efforts initiated last year in flood-
ravaged areas.
      29. $2,000,000 for the New York City watershed protection 
program.
      30. $500,000 for the Treasure Valley hydrologic project.
      31. $2,500,000 for the King County, Washington molten 
carbonate fuel cell demonstration project at the Renton 
wastewater treatment plant.
      32. $$800,000 for the National Center for Vehicle 
Emissions Control and Safety to establish an On-Board 
Diagnostic Research Center.
      33. $500,000 to continue the Compliance Assistance Center 
for Painting and Coating Technology.
      34. $200,000 to complete the cleanup of Five Island Lake.
      35. $500,000 for the Ala Wai Canal watershed improvement 
project.
      36. $400,000 for the Maui algal bloom project.
      37. $100,000 for the Design for the Environment for 
Farmers Program to address the unique environmental concerns of 
the American Pacific area and the need to develop and adopt 
sustainable agricultural practices for these fragile tropical 
ecosystems.
      38. $1,500,000 for the Lake Champlain management plan.
      39. $600,000 for the final year of funding for the solar 
aquatic wastewater treatment demonstration in Burlington, 
Vermont, to be cost-shared.
      40. $1,000,000 for the Alabama Department of 
Environmental Management to coordinate a model water/wastewater 
operating training program.
      41. $150,000 to establish a regional training center at 
the Kentucky Onsite Wastewater Center.
      42. $550,000 for the Idaho water initiative.
      43. $1,750,000 for the Three Rivers watershed protection 
demonstration project, to develop an overall master plan to 
eliminate more than 40 separate sanitary sewer overflows in the 
Three Rivers area of Allegheny County, Pennsylvania.
      44. $750,000 to continue the Resource and Agricultural 
Policy Systems program.
      45. $1,250,000 for the design of an innovative granular 
activated carbon water treatment project in Oahu.
      46. $2,000,000 for the Food and Agricultural Policy 
Research Institute's Missouri Watershed Initiative project to 
link economic and environmental data with ambient water 
quality.
      47. $1,500,000 for the National Alternative Fuels 
Training program.
      48. $300,000 for the California Urban Environmental 
Research and Education Center.
      49. $1,000,000 to continue the implementation of a 
wetlands-based potable water reuse program for the City of West 
Palm Beach.
      50. $700,000 for the Long Island Sound office.
      51. $2,000,000 for the University of Missouri 
Agroforestry Center to support the agroforestry floodplain 
initiative on a partnership basis.
      52. $300,000 for the Northeast States for coordinated air 
use management.
      53. $750,000 for the Chesapeake Bay Program to initiate a 
small watershed grants program for the implementation of 
cooperative tributary basic strategies that address the Bay's 
water quality and living resource needs.
      54. $1,300,000 for environmental justice small community 
grants, bringing the total program to $2,000,000.
      55. $240,000 for the water quality testing program along 
the New Jersey and New York shorelines.
      56. $1,000,000 for the Soil Aquifer Treatment research 
program for indirect potable reuse of highly treated domestic 
wastewater being conducted in Arizona and California.
      57. $1,500,000 for wastewater training grants under 
section 104(g) of the Clean Water Act.
      58. $2,000,000 for the National Academy of Public 
Administration to design and manage a series of independent 
evaluations of recent EPA initiatives to improve the 
effectiveness and efficiency of EPA activities. These studies 
shall also assess how lessons learned can be built into ongoing 
agency programs. The conferees note that EPA has yet to develop 
a program evaluation capacity, a critical element of meeting 
the requirements of the Government Performance and Results Act 
and ensuring the most effective allocation of resources. EPA is 
to enter into an agreement with NAPA within 90 days, so that 
the reports may be made available to the Congress within two 
years.
      59. $1,500,000 to support response and monitoring 
efforts, public information functions, and cross-Agency 
coordination and analysis to address the causes, mechanisms, 
and health and environmental effects of Pfiesteria, as 
described in the Science and Technology account.
      60. $400,000 to continue efforts to ensure smooth 
implementation of notification of lead-based paint hazards 
during real estate transactions through the Alliance to End 
Childhood Lead Poisoning.
      The conferees have agreed to the following decreases from 
the budget request:
      1. $693,000 from managerial support within the Office of 
the Administrator.
      2. $1,000,000 from GLOBE.
      3. $9,000,000 from the Montreal Protocol Multilateral 
Fund.
      4. $54,000,000 from Climate change action plan programs.
      5. $5,500,000 from Office of Enforcement and Compliance 
Assurance programs. No reduction is to be applied to compliance 
assistance activities.
      6. $1,734,000 from the Office of International Activities 
global and regulatory environmental risk reduction program.
      7. $10,000,000 from the new environmental monitoring for 
public access and community tracking program.
      8. $10,107,000 from specific reinvention programs.
      9. $3,900,000 from the new Urban Livability program.
      10. $10,000,000 from the increase requested for 
sustainable development challenge grants.
      11. $2,000,000 from rental costs.
      12. $55,115,900 as a general reduction.
      The conferees note that full funding has been provided 
for the Chesapeake Bay Program including $833,000 for 
atmospheric deposition research activities.
      The conferees are concerned with the Agency's perceived 
inflexibility regarding the implementation of the enhanced 
vehicle emissions and inspection programs in a number of 
states. Despite passage of the National Highway System 
Designation Act of 1995 which included language stating that, 
``the Administration shall not require adoption or 
implementation by a state of a test-only I/M 240 enhanced 
vehicle inspection and maintenance program,'' EPA has until 
very recently required that states using equipment other than 
I/M 240 perform mass emission transient testing (METT) on 0.1% 
of their affected vehicles, yet has only approved I/M 240 
equipment to conduct the METT. It was the intent of Congress to 
prohibit the mandating of I/M 240 for any purpose, whether for 
emission testing or evaluation testing. Therefore, it is 
expected that the Agency will resolve this issue with the 
affected states and develop a non-METT test consistent with 
Congressional intent. The Agency is urged to develop 
alternatives which, as required by the Clean Air Act, are based 
on data collected during inspection and repair of vehicles. The 
alternatives also should be seamless to the customer and not 
result in increased costs to the customer or service station 
owner, and also not result in a direct or indirect penalty to 
the state that is not using METT. In the event that the Agency 
does not develop a non-METT evaluation method, the conferees 
would expect to address this issue in legislation.
      The conferees continue to note their serious concerns 
regarding the new National Pollutant Discharge Elimination 
System (NPDES) general permit recently proposed by EPA's Region 
IV. This issue was raised in the House Report accompanying H.R. 
2158, and it appears the Agency has done little to address the 
concerns raised in that document. The conferees therefore 
direct EPA's Region IV to adopt an NPDES general permit for 
offshore oil and gas extraction which is substantially similar 
in its terms and conditions to that adopted and used 
successfully by EPA's Region VI.
      The conferees are aware that recent testing conducted at 
Lake Tahoe has shown abnormal amounts of volatile compounds, 
including benzene, toluene, and xylene. The conferees recommend 
that EPA consider conducting an analysis and produce a report 
detailing the actual levels of contaminants, sources, and 
recommendations to protect this resource.
      The conferees urge that EPA's recently announced 
stakeholder process for the section 313 program be 
expeditiously undertaken and that the recommendations be 
adopted prior to the filing of any reports required under the 
recent expansion of the program. EPA should dedicate the 
necessary resources to ensure this process can develop 
materials and procedures that will simplify the reporting 
burden, especially for small businesses, while also improving 
the ability to communicate information to the public.
      The conferees direct the EPA Administrator to consider 
for funding the NUI proposal for a large-scale demonstration 
pilot project in correlation with the dredging contamination 
technology effort currently underway at Brookhaven National 
Laboratory.

                      Office of Inspector General

      Appropriates $28,501,000 for the office of inspector 
general as proposed by the House instead of $28,500,000 as 
proposed by the Senate.

                        buildings and facilities

      Appropriates $109,420,000 for buildings and facilities 
instead of $182,120,000 as proposed by the House and 
$19,420,000 as proposed by the Senate.
      For the new, consolidated research facility at Research 
Triangle Park, North Carolina, the conferees have agreed to an 
additional funding component for fiscal year 1998 of 
$90,000,000. The Agency has indicated this level of funding is 
sufficient to continue ongoing planning and construction as 
scheduled throughout the fiscal year. The conferees have also 
included bill language which raises the authorized construction 
cost ceiling for this project to $272,700,000. This level of 
authorization is necessary to permit the construction of the 
building--including the high bay facility, the computer center, 
and the child care center--as originally designed. Prior to the 
expenditure of funds relative to these three facilities, 
however, the Agency is directed to provide a cost/benefit 
analysis which justifies their inclusion as proposed in the 
original construction plan.

                     hazardous substance superfund

      Appropriates $2,150,000,000 for hazardous substance 
superfund instead of $1,500,699,000 as proposed by the House 
and $1,400,000,000 as proposed by the Senate.
      The conferees have agreed to the following fiscal year 
1998 program levels:
      $990,500,000 for the superfund response/cleanup program, 
including the full budget request for the Brownfields program.
      $174,000,000 for the enforcement program.
      $129,000,000 for management and support, including 
$11,641,000 for transfer to the Office of Inspector General.
      $35,000,000 for research and development activities, to 
be transferred to the Science and Technology account.
      $58,000,000 for the National Institute of Environmental 
Health Sciences, including $23,000,000 for worker training and 
$35,000,000 for research activities.
      $74,000,000 for the Agency for Toxic Substances and 
Disease Registry. The amount provided is intended to enable 
ATSDR to reduce significantly the backlog of more than 200 
hazardous waste sites requiring public health activities and to 
conduct a child health initiative. Within 30 days of enactment 
of this Act, ATSDR is to provide a detailed operating plan to 
the Committees on Appropriations. In addition, ATSDR 
periodically is to keep the Committees apprised of progress in 
reducing the backlog, efforts related to the child health 
initiative, and proposed new activities. Within the funds 
provided herein, $4,000,000 is for minority health professions, 
$2,500,000 is for continuation of a health effects study on the 
consumption of Great Lakes fish, and $2,000,000 is for 
continued work on the Toms River, New Jersey cancer evaluation 
and research project.
      $39,500,000 for interagency activities.
      The conferees note that $100,000,000 of the funds 
provided herein shall not become available for obligation until 
September 1, 1998. Further, $650,000,000 of the funds provided 
herein shall not become available until October 1, 1998, and 
shall be available for obligation only if specific 
reauthorization of the Superfund program occurs by May 15, 
1998.
      While the conferees have provided the full budget request 
for the Brownfields program, concerns remain regarding the 
Agency's legal authority to utilize Superfund dollars to 
establish revolving funds which in turn would be used to clean 
up sites which are neither emergency in nature nor eligible for 
NPL listing. Bill language has therefore been included which 
prohibits the use of funds under this heading for revolving 
loan funds unless specifically authorized in subsequent 
legislation.
      Again this year, the conferees direct that all fiscal 
year 1997 carryover funds be used for additional response 
action/cleanup efforts. In addition, in order to enhance the 
fiscal year 1998 response action/cleanup program, the conferees 
direct the Agency to move expeditiously to deobligate and 
recapture as much unspent prior-year cleanup funds as possible.
      The conferees reiterate the position of the House that 
strongly encourages the Agency to implement a fixed-price, at-
risk contracting proposal for the clean-up of the Carolina 
Transformer Site in North Carolina.
      With regard to the Agriculture Street Landfill Superfund 
site in New Orleans, the conferees are aware of the potential 
health risks associated with remediating the undeveloped 
property without permanent or temporary relocation of the 
nearby residents, or some other responsible mitigation effort. 
The conferees thus strongly urge the Agency to stay the 
remediation of the site, pursuant to its Record of Decision of 
September 2, 1997, until this matter can be satisfactorily 
resolved.
      The conferees also reiterate the concern as expressed in 
the House Report accompanying H.R. 2158 regarding the EPA's 
response to certain ``emergencies.'' Questions of both legal 
authority and the excessive expenditure of funds outside the 
scope of the Agency's operating plan remain very troubling. The 
conferees therefore direct the EPA to notify the Committees on 
Appropriations within 72 hours of theAgency's undertaking an 
emergency response at non-NPL sites that is expected to exceed 
$5,000,000 in total cost.
      Last year, the conferees included language directing the 
EPA Administrator to begin construction immediately at the Pepe 
Field Superfund site in Boonton, New Jersey. Due to a change in 
the remedy by the EPA, the construction has again been delayed. 
The conferees are concerned with this delay and direct the 
Administrator to begin construction immediately.

                leaking underground storage tank program

      Appropriates $65,000,000 for the leaking underground 
storage tank program as proposed by the Senate instead of 
$60,000,000 as proposed by the House. Language is also included 
which provides a maximum of $7,500,000 for the program's 
administrative costs as proposed by the Senate instead of 
$9,100,000 as proposed by the House.
      The conferees direct that not less than 85 percent of the 
funds provided be allocated to the States.

                           oil spill response

      Appropriates $15,000,000 for oil spill response as 
proposed by the House and the Senate. Bill language is also 
included which provides a maximum of $9,000,000 for the 
program's administrative costs as proposed by the House instead 
of $8,500,000 as proposed by the Senate.

                   state and tribal assistance grants

      Appropriates $3,213,125,000 for state and tribal 
assistance grants instead of $3,026,182,000 as proposed by the 
House and $3,047,000,000 as proposed by the Senate.
      Bill language provides the following program levels:
      $1,350,000,000 for Clean Water Capitalization Grants.
      $725,000,000 for Safe Drinking Water Capitalization 
Grants. The conferees note that amounts provided for drinking 
water state revolving funds are available for national set-
asides outlined in section 1452; however, health effects 
research is funded in the Science and Technology account as 
proposed by the Administration.
      $75,000,000 for the United States-Mexico Border Program.
      $50,000,000 for colonias in Texas, including bill 
language which provides a 20% match for these funds. The match 
requirement may be fulfilled through the commitment of state 
funds for either loans or grants for construction of wastewater 
or water systems serving colonias and the match may also 
consist of payment on bond interest associated with loans or 
grants for construction of wastewater and water systems. With 
respect to prior appropriated funds for colonias, the match 
requirement may be fulfilled through the commitment of state 
funds for either loans or grants for construction of wastewater 
systems serving colonias and may also consist of payment on 
bond interest associated with loans or grants for construction 
of wastewater systems.
      $15,000,000 for Alaska rural and Native Villages, to be 
cost-shared.
      $745,000,000 for state and tribal categorical grants, 
including increases above the budget request of $24,743,000 for 
particulate matter monitoring and data collection and 
$5,000,000 for section 319 non-point source pollution grants. 
Language is included to direct that the PM monitoring and data 
collection grants be issued pursuant to section 103 of the 
Clean Air Act so as not to require a state, tribal, or local 
cost share. The conferees agree that performance partnership 
grants and statutorily authorized transfers between state 
revolving funds are both exempt from the Congressional 
reprogramming limitations. Finally, language is included which 
clarifies that, as provided in the authorizing statutes for the 
various program grants, eligible recipients have included since 
fiscal year 1996 interstate agencies, tribal consortia, and air 
pollution control agencies, as well as States and tribes.
      $253,125,000 for grants for construction of ``special 
needs'' wastewater, water treatment and drinking water 
facilities, and for groundwater protection infrastructure.
      Bill language has been included which: (1) authorizes 
cross collateralization of clean water and safe drinking water 
state revolving funds as security for bond issues; (2) 
authorizes the Administrator to make grants to federally 
recognized Indian governments for the development of multi-
media environmental programs; (3) makes it possible for EPA to 
use funds under this account for specific programs and purposes 
in state and tribal areas when such state or tribe does not 
have an acceptable program in place; and (4) authorizes the 
Administrator to make a grant of deobligated FWPCA section 205 
funds for wastewater treatment facilities in Monroe County, 
Florida.
      Finally, bill language has been included which provides 
for an 80/20 cost share for the use of capitalization funds for 
the District of Columbia. The provision, which is intended to 
permit the District to move aggressively in making necessary 
repairs and upgrades in its wastewater treatment facilities, 
will sunset in two years.
      The conferees agree that the special needs funds are 
provided as follows:
      1. $50,000,000 for Boston Harbor wastewater needs.
      2. $3,000,000 for continued wastewater needs in Bristol 
County, Massachusetts.
      3. $8,000,000 for New Orleans wastewater needs.
      4. $5,000,000 to implement drinking water facility 
improvements under Title IV and to implement combined sewer 
overflow (CSO) projects in Richmond ($2,500,000) and Lynchburg 
($2,500,000), Virginia.
      5. $14,000,000 for continuation of the Rouge River 
National Wet Weather Demonstration project.
      6. $5,000,000 for wastewater and water system needs of 
the Omnalinda Water Association ($500,000); the Jenner Township 
Sewer Authority ($2,600,000), and the North Fayette County 
Municipal Authority ($1,900,000), Pennsylvania.
      7. $13,000,000 for the Millcreek Tube Sewer upgrade/
combined sewer overflow project.
      8. $3,000,000 for phase one of Sacramento's wastewater 
treatment facility upgrade.
      9. $10,000,000 for planning and implementation of a storm 
water abatement system in the Doan Brook Watershed Area, Ohio.
      10. $6,900,000 for wastewater infrastructure needs for 
Kenner ($5,000,000) and Baton Rouge ($1,900,000), Louisiana.
      11. $2,250,000 for Ogden, Utah's sanitary storm sewer and 
drinking water distribution systems.
      12. $2,500,000 to assist the Bad Axe, Michigan water 
crisis.
      13. $10,000,000 to complete the wastewater improvement 
program at the Clear Lake Sanitary District, Iowa.
      14. $7,000,000 for combined sewer overflow requirements 
in Lycoming County ($4,000,000) and for wastewater needs of the 
Pocono/Jackson Township Joint Authority ($1,500,000) and 
Smithfield Township in Monroe County ($1,500,000), 
Pennsylvania.
      15. $1,200,000 for phase two of the Geysers Effluent 
Project in Northern California.
      16. $14,000,000 for continued clean water improvements of 
Onondaga Lake.
      17. $5,000,000 for wastewater and drinking water system 
needs in Clearfield, Mifflin, Snyder and Fulton Counties 
($1,250,000); Decatur Township ($150,000); Lawrenceville 
Township ($300,000); Lyleville ($300,000); Lewistown 
($1,000,000); McVeytown ($500,000); Adams Township and Port 
Trevorton ($500,000); Middleburg ($500,000); and McConnellsburg 
($500,000), Pennsylvania.
      18. $10,000,000 for water supply and wastewater needs for 
the City of Burnside ($2,000,000); the City of Williamsburg 
($3,000,000); the City of Wayland ($1,500,000); the City of 
Hyden ($1,500,000); and the Morgan County Water District 
($2,000,000), Kentucky.
      19. $1,275,000 for wastewater needs for East Mesa 
($700,000), West Mesa ($500,000), and Lordsburg ($75,000), New 
Mexico.
      20. $4,000,000 for an alternative water supply system in 
Jackson County, Mississippi.
      21. $2,000,000 for wastewater facilities and improvements 
in Essex County, Massachusetts.
      22. $2,000,000 for the Milwaukee Metropolitan Sewerage 
District urban watershed restoration project (Lincoln Creek).
      23. $7,150,000 for export pipeline replacement to protect 
Lake Tahoe.
      24. $7,000,000 for wastewater facility and sanitary 
system improvements in Burlington, Iowa.
      25. $7,000,000 for the Ashley Valley, Utah sewer 
management board for wastewater improvements.
      26. $5,000,000 for water systems improvements in the 
Virgin Valley Water District, Nevada.
      27. $2,000,000 for the town of Epping, New Hampshire, for 
wastewater treatment upgrades.
      28. $4,300,000 for wastewater improvements in Queen 
Anne's County, Maryland, ($2,300,000); and biological nutrient 
removal of sewage on the Pocomoke River, Maryland ($2,000,000).
      29. $6,000,000 for water/wastewater improvements in the 
Moreland/Riverside area of Bingham County ($3,000,000); the 
City of Rupert ($2,000,000); and the Rosewell and Homedale 
areas ($1,000,000) of Idaho.
      30. $5,000,000 for Missoula, Montana sewer system 
improvements.
      31. $3,000,000 for the Milton, Vermont wastewater 
treatment plant project.
      32. $5,000,000 for sewage infrastructure improvements for 
Connellsville and Bullskin Townships in Fayette, Pennsylvania 
($2,500,000) and Fallowfield Township, Pennsylvania 
($2,500,000).
      33. $6,300,000 for wastewater treatment improvements in 
Pulaski County ($5,000,000) and Kingdom City ($1,300.000), 
Missouri.
      34. $8,000,000 for the Upper Savannah Council of 
Governments for wastewater facility improvements for the 
Savannah Valley regional sewer project in Abbeville, McCormick, 
and Edgefield Counties, South Carolina.
      35. $3,300,000 for water system improvements in Jackson 
County ($800,000), Washington County ($2,000,000), and Cleburne 
County ($500,000), Alabama.
      36. $1,800,000 for water treatment improvements in the 
Joshua Basin Water District.
      37. $100,000 for wastewater infrastructure improvements 
in Ascension Parish, Louisiana.
      38. $50,000 for water and sewer improvements in the City 
of Kinloch, Missouri.
      39. $3,000,000 for alternative source projects in the St. 
Johns River, South Florida, and Southwest Florida Water 
Management Districts.
      The conferees recognize the acute need for additional 
water treatment capacity in San Diego County, California. While 
limited funds prevent the conferees from providing fiscal year 
1998 funds for the development of the Olivenhain Water 
Treatment Project, the conferees recognize the project's 
potential to demonstrate the environmental and health benefits 
associated with microfiltration technology. Also, with regard 
to San Diego's South Bay Water Reclamation Facility, the 
conferees are aware of the City's application for grant 
assistance through the United States-Mexico border projects 
program and that EPA and the NADBank have not rendered final 
judgment on the application. The conferees urge the Agency and 
the NADBank to review carefully this matter so as to provide 
any appropriate support. Should the application of the City be 
declined, the Agency is to provide a report to the Committees 
on Appropriations within 30 days of such action which explains 
in detail the decision of the Agencies.
      Finally, the conferees note their support for 
construction of the Jonathan Rogers plant in El Paso, Texas and 
encourage the Agency to provide an appropriate amount from the 
border infrastructure fund to support the federal share of this 
project.

                   EXECUTIVE OFFICE OF THE PRESIDENT

  Council on Environmental Quality and Office of Environmental Quality

      Appropriates $2,500,000 for the Council on Environmental 
Quality and Office of Environmental Quality instead of 
$2,506,000 as proposed by the House and $2,436,000 as proposed 
by the Senate.
      The conferees have agreed to bill language proposed by 
the House which stipulates that, notwithstanding the provisions 
of the National Environmental Policy Act (NEPA), there will for 
fiscal year 1998 be just one member of the Council on 
Environmental Quality (instead of three), and that individual 
shall act as chairman.
      The conferees have also agreed to language proposed by 
the Senate which prohibits CEQ from using funds other than 
those appropriated directly to CEQ under this heading. This 
language is intended to prevent CEQ from augmenting its staff 
through the use of employees detailed from other federal 
agencies. It is not intended to prevent CEQ from conducting 
activities authorized under NEPA, including the coordination of 
activities of federal agencies relative to environmental policy 
issues. Further, the language is not intended to bar the 
formation of interagency task forces or prevent requests for 
information from other federal agencies.

                          unanticipated needs

      Appropriates $1,000,000 for unanticipated needs within 
the Executive Office of the President. The conferees note that 
this funding was included in this legislation at the request of 
the Administration because it was excluded from another 
appropriation measure. The conferees do not anticipate funding 
this program in this Act in subsequent fiscal years.

                 FEDERAL DEPOSIT INSURANCE CORPORATION

                      Office of Inspector General

      Appropriates $34,365,000 for the Office of Inspector 
General as proposed by the House instead of $34,265,000 as 
proposed by the Senate. Funds for this account are derived from 
the Bank Insurance Fund, the Savings and Loan Association 
Insurance Fund, and the FSLIC Resolution Fund, and are 
therefore not reflected in either the budget authority or 
budget outlay totals.

                  FEDERAL EMERGENCY MANAGEMENT AGENCY

                            disaster relief

      Appropriates $320,000,000 for disaster relief as proposed 
by the Senate instead of $500,000,000 as proposed by the House.
      The conferees are supportive of FEMA's initiative to 
establish a Federal Coordinating Officer cadre staffed by full-
time employees and funded by the Disaster Relief Fund to 
support ongoing field operations. The Agency is expected to 
keep the Committees on Appropriations informed of its progress 
as it proceeds with its plans to enroll the 25 member cadre. If 
the Agency moves forward on this initiative, the fiscal year 
1998 operating plan should reflect this activity.
      While the conferees have not included language proposed 
by the Senate prohibiting the use of disaster relief funds in 
certain instances, the conferees support efforts to rein in 
disaster relief expenditures, which have grown exorbitantly in 
recent years. The conferees acknowledge that under current law, 
disaster relief payments have been made for such lower priority 
activities as refurbishing golf courses in certain high income 
communities. To offset the cost of growing disaster relief 
requirements, a series of supplemental appropriations bills in 
the past few years have included large rescissions of funds 
from other agencies' programs, principally low income housing. 
Earlier this year, FEMA proposed amendments to the Stafford Act 
which represent a modest first step in curbing disaster relief 
expenditures. The conferees strongly urge the committees of 
jurisdiction to take swift action to consider the proposed 
Stafford Act amendments, including holding hearings at the 
earliest possible time.

              emergency management planning and assistance

      Appropriates $243,546,000 for emergency management 
planning and assistance instead of $261,646,000 as proposed by 
the House and $207,146,000 as proposed by the Senate. Bill 
language is included which provides $30,000,000 for pre-
disaster mitigation activities instead of $50,000,000 as 
proposed by the House and $5,000,000 as proposed by the Senate 
for pre-disaster mitigation grants to state and local 
governments.
      The conferees have provided the following increases to 
the budget request:
      $500,000 for the completion of a comprehensive analysis 
and plan of all evacuation alternatives for the New Orleans 
metropolitan area.
      $5,000,000 for FEMA to continue the replacement and 
upgrade of emergency equipment and vehicles. The conferees 
expect to be informed in the operating plan as to how these 
funds are expected to be spent.
      $3,000,000 for State and local assistance through 
comprehensive cooperative agreements.
      $2,900,000 for the Dam Safety program, including 
$1,000,000 for research in dam safety; $1,000,000 for incentive 
grants to States to upgrade their dam safety program; $500,000 
for training programs for State dam safety inspectors; and 
$400,000 for administration of the program.
      The conferees have included bill language providing for a 
grant of $1,500,000 to resolve issues under the Uniform 
Relocation Assistance and Real Property Acquisition Policies 
Act of 1970, Public Law 91-646, involving the City of Jackson, 
Mississippi. These issues were identified in a January 30, 1989 
report of the United States Department of Housing and Urban 
Development.
      Acknowledging the importance of pre-disaster mitigation 
in reducing the loss of human life, the costs and disruption 
caused by severe property damage, and the ever-growing cost to 
all taxpayers of government-backed disaster relief efforts, the 
conferees have provided $30,000,000 for program planning and 
implementation of pre-disaster mitigation efforts. The 
conferees acknowledge the potential value of various 
alternatives that have been suggested to achieve pre-disaster 
mitigation, including grants to state and local governments to 
conduct pilot demonstration projects as proposed by the Agency 
in their fiscal year 1998 budget submission, the HomeSaver 
Project proposed by The Partnership for Natural Disaster 
Reduction, the rapid deployment-technologies concept proposed 
by the Centers for Protection Against Natural Disasters 
(CPAND), and other research and applied engineering activities, 
particularly those jointly funded by the public and private 
sectors.
      The conferees agree that up to $5,000,000 of the amount 
provided for pre-disaster mitigation is available immediately 
to fund up to seven pilot projects approved by the Director of 
FEMA. Prior to the expenditure of the remaining funds for any 
specific pre-disaster mitigation program or project, the 
conferees direct that the appropriate level of funding be used 
by the Agency to conduct a formal needs-based analysis and 
cost/benefit study of all of the various mitigation 
alternatives. The results of these analyses and studies, along 
with any relevant information learned from the aforementioned 
seven pilot projects, shall be incorporated into a 
comprehensive, long-term National Pre-disaster Mitigation Plan. 
The plan should be developed, independently peer-reviewed, and 
submitted to the Committees on Appropriations not later than 
March 31, 1998. FEMA is directed to involve in this planning 
effort participants which shall include, but are not limited 
to, representatives of FEMA and other federal agencies, state 
and local governments, industry, universities, professional 
societies, the National Academy of Sciences, The Partnership 
for Natural Disaster Reduction, and CPAND. The conferees intend 
that none of the remaining funds provided herein be obligated 
until the plan has been completed and submitted as outlined 
above. The conferees note that this approach is intended to be 
the foundation for providing the best and most cost-effective 
solution to reduce the tremendous human and financial costs 
associated with natural disasters.
      The conferees believe that attention is warranted to 
minimize losses to existing steel frame structures during and 
following major earthquakes. Although many steel frame 
structures were designed and constructed in accordance with 
building codes in effect at the time of construction, 
experience in the 1994 Northridge, California earthquake and 
the 1995 Kobe, Japan earthquake suggests a heightened 
vulnerability of these structures. Accordingly, the conferees 
urge FEMA to consider a pilot pre-disaster mitigation project 
that would incorporate the greater use of new steel frame 
manufacturing and retrofitting technologies as a method to 
reduce disaster response costs.
      The conferees are aware of proposals by the International 
Hurricane Center at Florida International University to apply 
advanced high-accuracy satellite laser altimeter surveying 
techniques to coastal and flood plain modeling and post natural 
disaster damage assessments. FEMA is urged to consider funding 
such proposals from discretionary funds to improve its 
modeling, mapping, damage assessment, and pre-disaster 
mitigation efforts.
      The conferees understand that many scientists studying 
climate change have predicted a large-scale El Nino phenomenon 
this year. Many such experts who have monitored this phenomenon 
for decades project that this El Nino may cause extreme weather 
events far worse than others associated with El Nino events of 
past years. While it is impossible to prevent these extreme 
weather events, the conferees recognize that recently developed 
El Nino prediction capabilities can be utilized to mitigate 
loss of life, human dislocation, and property damages which may 
occur. The conferees encourage FEMA to work with other federal 
agencies, including NOAA, NASA, USDA, the Army Corps of 
Engineers, and the Department of the Interior to utilize El 
Nino prediction data for disaster planning and mitigation 
during fiscal year 1998 and explore opportunities to expand the 
use of this new predictive capability for long-term mitigation 
planning.
      The conferees note that Pointe Coupee Parish, Louisiana 
faces the potential threat of multiple disasters, which include 
the fixed site storage and transportation of volatile 
chemicals, a nuclear power generating facility, and such 
weather related threats as hurricanes, floods, and tornadoes. 
Disaster mitigation and response requires rapid response by 
civil agencies, but this is not possible without a 
communications system with the capability to coordinate 
immediately the activities of all disaster response teams. The 
conferees urge FEMA to work closely with the Parish and provide 
appropriate support for the installation and testing of a 
prototype communications system. Disaster response officials 
from Pointe Coupee Parish are expected to work closely with 
FEMA to make available the results of the demonstration project 
to other local governments and law enforcement agencies.

                     NATIONAL FLOOD INSURANCE FUND

      Bill language which extends the borrowing authority for 
the flood insurance program of $1,500,000,000 for fiscal year 
1998 as proposed by the House has been included.
      The conferees have also included new bill language which 
authorizes the National Flood Insurance Program for fiscal year 
1998. Without this authorization, new flood insurance policies 
could not be written throughout the fiscal year.
      Finally, language which permits the continuation of flood 
mapping activities of FEMA has been included.

             National Aeronautics and Space Administration

      The conferees note that the United States space launch 
industry has identified underutilized infrastructure at the 
Stennis Space Center for potential use in launch vehicle 
development activities. The conferees consider such proposed 
use of this infrastructure to be compatible with the Center's 
propulsion test programs and consistent with other efforts to 
optimize taxpayer investments while fostering U.S. 
competitiveness and commercial use of space. The conferees urge 
NASA to pursue an appropriate method for making the 
underutilized Stennis infrastructure available under suitable 
terms and conditions, if so requested by industry, and to 
notify the Committees on Appropriations of the House and Senate 
if existing NASA authority is insufficient for this purpose.

                           HUMAN SPACE FLIGHT

      Appropriates $5,506,500,000 for human space flight 
instead of $5,426,500,000 as proposed by the House and 
$5,326,500,000 as proposed by the Senate. Within this amount, 
the appropriation for space shuttle is $2,927,800,000, the 
appropriation for payload and utilization is $227,400,000, and 
the appropriation for space station and related activities is 
$2,351,300,000.
      The conferees agree that the agency may provide 
$1,000,000 for the Neutral Buoyancy Simulator program, as was 
provided in the Senate bill. In addition, before providing 
funding for the program, the conferees request that NASA report 
on the potential viability of commercialization of the Neutral 
Buoyancy Simulator.
      The conferees have agreed to an appropriation of 
$2,351,300,000 for Space Station activities in fiscal year 
1998, including $80,000,000 from funds in the mission support 
account identified by the agency ($25,000,000 from TDRS, 
$20,000,000 from environmental programs, $30,000,000 from 
Research Operations Support, and $5,000,000 from facilities), 
$100,000,000 in addition to the agency's request, and 
$50,000,000 by reallocation from within the amounts requested 
in the Human Space Flight account.
      Of the amount provided for space station activities, no 
more than $1,500,000,000 shall be available before March 31, 
1998, as stated in the bill.
      The conferees are troubled by the problems with the space 
station which include projected development cost overruns of 
$600,000,000-$800,000,000, the inability to hold critical 
hardware delivery and launch dates despite receiving the post 
re-design funding profile requested by the Administration, and 
failure to reduce the contractor team's development workforce 
in keeping with budget projections submitted with the 1997 and 
1998 budgets.
      Therefore, the conferees have agreed to provide only part 
of the funding and none of the transfer authority that NASA has 
identified as necessary for the program in fiscal year 1998, 
$230,000,000 above the Administration's budget request, rather 
than $430,000,000. In addition, the conferees have withheld 
about a third of the total space station funds, pending receipt 
of certain documents and information listed below. This gives 
NASA and the space station contractor the opportunity to 
reexamine the funding profile, schedule, content, and 
efficiency of the program.
      The remaining $851,300,000 will be made available after 
March 31, 1998, if the Committees on Appropriations receive the 
Administration's fiscal year 1999 budget for NASA, including 
the annual run-out budget for the Station program through 
assembly complete, and also outyear projections for other NASA 
enterprises that retains funding levels for fiscal year 1999-
2002 at levels no less than those assumed in the fiscal year 
1998 budget. The conferees expect the outyear projections to 
reflect a balance among NASA's programs.
      In addition to the requirement about the fiscal year 1999 
NASA budget and bill language limiting the use of a portion of 
space station funds until March 31, 1998, the remaining 
$851,300,000 remains fenced until and unless NASA provides the 
following items to the Committees on Appropriations of the 
House and Senate, and the Committees subsequently approve the 
release of these funds:
            1. A detailed plan, agreed jointly to by NASA and 
        the prime contractor, for the contractor's monthly 
        staffing levels through completion of development, and 
        evidence that the contractor has held to the agreed-
        upon destaffing plan through the first four months of 
        fiscal year 1998;
            2. A detailed schedule, agreed jointly to by NASA 
        and the prime contractor, for delivery of hardware, and 
        NASA's plans for launching the hardware;
            3. A detailed report on the status of negotiations 
        between NASA and the prime contractor for changes to 
        the contract for sustaining engineering and spares, 
        with the expectation that NASA adhere to the self-
        imposed annual cap of $1,300,000,000 for operations 
        after construction is complete; and
            4. A detailed analysis by a qualified independent 
        third party of the cost and schedule projections 
        required in 1), 2), and 3) above, either verifying 
        NASA's data or explaining reasons for lack of 
        verification.
      Given how severe the program's budget problems are, the 
conferees are also mindful that future NASA budgets must be 
funded within discretionary spending caps in the five-year 
balanced budget agreement, meaning that budget outlays in 
fiscal year 1999 for all discretionary spending will grow by 
just one percent. As a result, the conferees are concerned that 
future NASA budgets not force reductions in the current outyear 
projections for space science, earth science, aeronautics, and 
advanced space transportation because of the need to 
accommodate overruns in the space station budget.

                   SCIENCE AERONAUTICS AND TECHNOLOGY

      Appropriates $5,690,000,000 for science, aeronautics and 
technology as proposed by the House instead of $5,642,000,000 
as proposed by the Senate.
      The conference agreement reflects the following changes 
from the budget request:
      1. A general reduction of $66,000,000.
      2. An increase of $1,000,000 for Multiple Sclerosis 
cooling therapy research.
      3. An increase of $5,500,000 for the space radiation 
health program.
      4. An increase of $1,000,000 for eye tracking technology 
miniaturization.
      5. An increase of $10,000,000 for additional optical 
astronomy test beds as proposed in the Senate report (105-53). 
This amount represents the total NASA contribution to the 
capital costs for these efforts and operating costs are to be 
covered by the host activity.
      6. An increase of $1,000,000 for the United States/Mexico 
Foundation for Science.
      7. An increase of $5,000,000 for the lightning mapper 
sensor.
      8. An increase of $450,000 for use of satellite imagery 
in urban planning and agricultural applications.
      9. An increase of $15,000,000 for funding up to five 
consortia to develop regional application with the use of EOS 
data.
      10. An increase of $5,800,000 for Commercial Technology 
Programs.
      11. An increase of $6,000,000 for telecommunications 
technology infrastructure for K-12 schools.
      12. An increase of $1,900,000 for the National Technology 
Transfer Center.
      13. An increase of $1,750,000 for the Midwest Regional 
Technology Transfer Center.
      14. An increase of $5,000,000 for a NASA business 
incubator program which is designed to foster partnerships 
between educational institutions and small high-technology 
businesses. The program is to be a nation-wide competitive 
program with successful applicants demonstrating at least 50 
percent of total funds will be derived from non-federal 
sources.
      15. An increase of $1,500,000 to restructure the Software 
Optimization and Reuse Technology program. The conferees are 
concerned that this program has not delivered expected results; 
the conferees expect NASA to restructure its current funding 
mechanism to allow for greater oversight and improved results. 
The conferees expect this funding to be expended over a two 
year period.
      16. The conferees agree to provide an additional 
$20,000,000 only for post-cycle I activity on the Low Cost 
Booster Technology Demonstration. NASA is to proceed with cycle 
I awards, but no funds may be used for market analysis or 
development of business plans. In addition, the conferees agree 
that prior to any contract awards beyond cycle I, NASA, with 
the Marshall Space Flight Center as the lead center, is to 
convene a conference of all interested parties to determine the 
best program structure to achieve the goal of a space launch 
platform for a 150 kg payload to attain a 200 nautical mile, 
sun-synchronous orbit, in the range of less than $2,000,000 in 
recurring cost. Furthermore, the conferees agree that said 
conference shall conclude prior to the end of cycle I and that 
recommended changes to the program that materialize shall be 
presented to Congress prior to implementation by NASA.
      17. An increase of $1,500,000 for MSE-Technology 
Applications, Western Environmental Technology Office.
      18. A decrease of $1,000,000 for a joint program with the 
Department of Defense.
      19. An increase of $3,300,000 for replication of the 
SEMAA program.
      20. An increase of $2,500,000 for a science learning 
center in Kenai, Alaska.
      21. An increase of $1,000,000 for the Discover Science 
Center, Santa Ana, California.
      22. An increase of $9,000,000 for expansion of the 
Partnership Awards program.
      23. An increase of $2,000,000 for Daily Living Science 
Center in Kenner, Louisiana.
      24. An increase of $5,800,000 for the Space Grant College 
and Fellowship program.
      25. An increase of $1,500,000 for the Pennsylvania 
Educational Telecommunications Exchange Network.
      26. An increase of $1,500,000 for academic and 
infrastructure needs at the Apple Valley, California science 
and technology center.
      27. An increase of $3,000,000 for Solar-B.
      28. An increase of $3,000,000 for solar stereo.
      The conferees also agree that NASA should continue with 
its efforts to purchase Earth science data from private 
industry to the extent it is appropriate.
      The conferees concur with the intent of the language in 
Senate report 105-53 with regard to the Earth Observing System 
Data Information System (EOSDIS). The conferees wish to make 
clear, however, that NASA should make any evaluation of the 
future of the ECS based not only upon delivery, but also 
successful performance demonstrated in the initial post-launch 
operational capabilities of EOSDIS as it relates to both the 
AM-1 and Landsat-7 spacecraft. Further, the conferees believe 
that NASA should proceed carefully with the federation of 
mission to planet earth, but ensure the earth science community 
should not in any way be prevented from participating in this 
endeavor. Therefore, issuance of any conflict of interest 
guidelines should be construed narrowly to apply only to 
immediate ESSAC members, and pertain simply to future 
eligibility for any cooperative agreement notices related 
exclusively to federated management funding, which is to be 
capped in fiscal year 1998 at $10,000,000.
      The conferees concur with the direction of the Senate to 
promote competition in the award of advanced technology 
development (ATD) funds. To achieve this end, commencing with 
fiscal year 1998 and continuing in each year thereafter, NASA 
should consolidate all space science ATD activities into an 
easily accessible consolidated budget line item and award not 
less than 75 percent of these funds through broadly distributed 
announcements of opportunity that solicit proposals from all 
categories of organizations, including educational 
institutions, industry, nonprofit institutions, NASA Centers, 
the Jet Propulsion Laboratory, and other Government agencies, 
and that allow partnerships among any combination of these 
entities, with evaluation, prioritization, and recommendations 
made by external peer review panels, consistent with the 
recommendations contained in the 1995 National Academy of 
Sciences report on managing the space sciences. In awarding ATD 
funds in this manner, the conferees wish to make clear that 
final selection of all proposals rests with NASA officials 
consistent with Office of Procurement Policy guidelines; and 
that setting technology requirements that are the foundation of 
the AO's rests with NASA program managers, consistent with 
guidance provided by advisory bodies of the at-large science 
community. In this fashion, NASA's technology investments will 
be managed in a manner parallel to that traditionally employed 
in implementing the agency's science program.

                            mission support

      Appropriates $2,433,200,000 for mission support instead 
of $2,513,200,000 as proposed by the House and $2,503,200,000 
as proposed by the Senate. The conference agreement includes 
transfer of $80,000,000 from this appropriation to the Human 
Space Flight appropriation for the space station effort. The 
specific reductions to this appropriation are delineated in an 
earlier section of this statement. In addition, the conferees 
agree that $5,000,000 is to be provided for facilities 
enhancements at the Stennis Space Center.
      The conferees concur with the direction of the Senate 
with respect to the NASA Wallops flight facility. The conferees 
wish to make clear that none of the funds appropriated or 
otherwise made available to the National Aeronautics and Space 
Administration by this Act, or any other Act enacted before the 
date of enactment of this Act, may be used by the Administrator 
of the National Aeronautics and Space Administration to 
relocate aircraft of the National Aeronautics and Space 
Administration based east of the Mississippi River to the 
Dryden Flight Research Center in California.

                       administrative provisions

      The conferees have included an administrative provision 
as proposed by the Senate which directs NASA to use $400,000 
for a study by the National Research Council which evaluates 
the engineering challenges posed by extravehicular activity 
requirements of space station construction/assembly.
      The conferees have not included the administrative 
provision proposed by the House and stricken by the Senate 
which would have provided $150,000,000 of transfer authority.

                  National Credit Union Administration

                       central liquidity facility

      Appropriates $1,000,000 for the National Credit Union 
Administration for the Community Development Revolving Loan 
Program for credit unions as authorized by Public Law 103-325.

                      National Science Foundation

                    research and related activities

      Appropriates $2,545,700,000 for research and related 
activities, instead of $2,537,526,000 as proposed by the House 
and $2,524,700,000 as proposed by the Senate.
      The conferees are in receipt of the Foundation's 
explanation of the programmatic areas of Knowledge and 
Distributed Intelligence in the Information Age and Life and 
Earth's Environment. The Foundation has not yet provided 
appropriate milestones and guideposts, to be accomplished in 
fiscal year 1998, and against which the agency can be measured 
in determining funding for fiscal year 1999. The conferees 
expect to receive such milestones and guideposts before the 
Foundation obligates any further funding for these programmatic 
areas.
      Through a cooperative agreement, the National Science 
Foundation has authorized the collection of fees for the 
registration of internet domain names. Under the terms of that 
agreement, a fund for the intellectual infrastructure of the 
internet has been established. For purposes of justifying the 
Foundation's requests for appropriations, the Foundation has 
included networking activities, such as the domain name 
registration activity, within its research facilities 
portfolio. The conferees concur that these activities should be 
considered research facilities.
      Accordingly, the conferees direct the Foundation to 
credit up to $23,000,000 of the funds collected in the 
``intellectual infrastructure'' fund to the Foundation's 
Research and Related Activities account for Next Generation 
Internet activities, pursuant to the authority to credit 
``receipts for scientific support services and material 
furnished by National Science Foundation supported research 
facilities.''
      The conferees are in agreement with the report of the 
Senate regarding participation by EPSCoR states in development 
of the Next Generation Internet. The conferees expect to 
receive the report by March 31, 1998.
      At its March 1997 meeting, the National Science Board 
evaluated proposals for Partnerships with Advanced 
Computational Infrastructure (PACI). At that meeting, two 
partnership proposals from two existing supercomputing centers 
were not selected. The Board provided for the phase-out over a 
period of up to two years of the two centers not selected. This 
phase-out was designed to recognize the substantial investment 
made by the United States in these two centers and to keep 
their resources available to the user community during a period 
of transition to the new partnership structure.
      The conferees are concerned that funding for the orderly 
phase-out of the two existing supercomputing centers, and the 
seamless transition of the user community to the new PACI 
program, be fully and fairly achieved in an expeditious and 
truly cooperative manner. Rather than providing additional 
funds for that purpose at this time, the conferees direct the 
Foundation to provide a report to the Committees on 
Appropriations of the House and Senate which details both the 
progress of the PACI program to date, and its further plans for 
the orderly phase-out and seamless transition of the 
Foundation's supercomputing program. This report should be 
submitted with the fiscal year 1999 budget and should focus 
particularly on how ``high-end'' users of the IBM SP 
supercomputing system will be fully serviced by the new 
partnerships, or, if necessary, by the new partnerships in 
close collaboration with the centers being phased-down.
      The conferees have agreed to provide $40,000,000 in 
addition to the budget request for a competitive, peer-reviewed 
plant genome research program. The conferees are in agreement 
that the program established by the National Science Foundation 
should be accomplished after consultation with the National 
Science and Technology Council's Interagency Working Group on 
plant genome research.
      The conferees have also agreed to provide $1,000,000 for 
the United States/Mexico Foundation for Science as proposed by 
the House.
      Finally, the conferees encourage the National Science 
Foundation to study how it would establish and operate a 
National Institute for the Environment.

                        major research equipment

      Appropriates $109,000,000 for major research equipment 
instead of $175,000,000 as proposed by the House and 
$85,000,000 as proposed by the Senate.
      The conferees agree to provide $4,000,000 for technical 
enhancements to the Gemini telescope project and $70,000,000 
for upgrades to Antarctic facilities. The amount provided for 
Antarctic facilities includes $35,000,000 to be made available 
immediately and the remaining $35,000,000 to be available on 
September 30, 1998. The conferees have not provided the budget 
request of $25,000,000 for the Polar Cap Observatory. The 
conferees direct the National Science Foundation to provide the 
Committees on Appropriations of the House and Senate an 
analysis of alternative sites for location of the observatory 
and a report on the scientific justification for the project.

                     Education and Human Resources

      Appropriates $632,500,000 for education and human 
resources, as proposed by the House instead of $625,500,000 as 
proposed by the Senate.
      The conferees agree to provide $2,000,000 for Advanced 
Technology Education and $5,000,000 for an initiative to 
improve the production of science and engineering doctorates 
drawn from under-represented groups as proposed in the House 
report. In addition, the conferees agree that the Foundation 
should provide $6,000,000 for an undergraduate reform 
initiative to increase the numbers of under-represented 
populations in mathematics, engineering and the sciences as 
proposed in the Senate report.

                         salaries and expenses

      Appropriates $136,950,000 for salaries and expenses, the 
same as provided by the House and the Senate. The conferees 
agree with the direction contained in the Senate report with 
regard to reporting total cost of administration and 
management.

                 Neighborhood Reinvestment Corporation

                      payment to the neighborhood

                        reinvestment corporation

      Appropriates $60,000,000 for the Neighborhood 
Reinvestment Corporation instead of $70,000,000 as proposed by 
the House and $50,000,000 as proposed by the Senate. As this is 
a 20 percent increase over the fiscal year 1997 funding level, 
the conferees request the Corporation to notify the Committees 
on Appropriations as to how this additional funding will be 
specifically utilized throughout the fiscal year.

                      TITLE IV--GENERAL PROVISIONS

      Language as proposed by the Senate which will allow funds 
made available under section 320(g) of the Federal Water 
Pollution Act to be used for implementing comprehensive 
conservation and management plans is included as section 420.
      Bill language regarding the Office of Consumer Affairs is 
included as section 421 as proposed by the Senate instead of as 
section 420 as proposed by the House.
      Inserts language proposed by the Senate defining 
``qualified student loan'' with respect to national service 
awards, modified to make the provision apply only to Alaska.
      Deletes language proposed by the Senate expressing a 
sense of the Senate regarding funding of veterans discretionary 
programs in future years. The conferees are concerned with the 
budget projections for veterans medical spending assumed in the 
1997 Balanced Budget Act. Veterans medical spending should be 
afforded the highest priority in the budget process in coming 
fiscal years to ensure that high quality medical care is 
accessible and available to all eligible veterans. The 
conferees note that the highest priority was afforded to 
veterans medical spending in the conference agreement on this 
legislation, which makes available approximately $300,000,000 
above the amount assumed in the budget agreement.
      Deletes language proposed by the House which prohibits 
the expenditure of funds to implement regulations regarding the 
importation of PCBs and PCB items.
      Deletes language proposed by the House which prohibits 
the expenditure of funds for grants or contracts to 
institutions of higher education which restrict ROTC 
activities.
      Deletes without prejudice language proposed by the Senate 
requiring Senate hearings relating to compensation benefits for 
radiation exposure. The Senate conferees support the Senate 
provision regarding Senate hearings and a CBO cost study 
concerning the atomic veterans issue. The conferees are 
concerned that veterans who were exposed to ionizing radiation 
while serving on active duty may have contracted various 
diseases which currently are not on the presumptive list of 
disabilities for radiogenic diseases, and urge the Secretary to 
review this matter.

          TITLE V--DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

                        portfolio reengineering

      Modifies S. 513, the ``Multifamily Assisted Housing 
Reform and Affordability Act of 1997,'' which was incorporated, 
by reference, by the Senate. The House-passed measure did not 
include a similar provision. The policies contained in this 
provision ensure the continued economic and physical vitality 
of the properties restructured under this title, protect the 
FHA insurance fund from excessive defaults, reduce the cost of 
rent subsidies paid to support insured projects, and guard 
against possible displacement of families who live in these 
buildings.
      Title V of the Act is divided into four subtitles. 
Subtitle A establishes a ``mark-to-market'' program to reduce 
the costs of over-subsidized section 8 multifamily housing 
properties insured by the Federal Housing Administration (FHA). 
Subtitle B includes several miscellaneous provisions to reform 
and establish new authority for the Secretary to recapture 
interest reduction payment subsidies from section 236 insured 
multifamily housing properties for purposes of providing 
rehabilitation grants to properties suffering from deferred 
maintenance. Subtitle C of the bill contains a number of 
provisions to minimize the incidence of fraud and abuse with 
regard to Federally assisted housing programs. Subtitle D 
creates the Office of Multifamily Housings Assistance 
restructuring.
      Under the ``mark-to-market'' program, FHA-insured section 
8 housing properties with above market rents are eligible for 
debt restructuring to reduce rent levels to those of comparable 
market rate properties or to the minimum level necessary to 
support proper operations and maintenance. In response to 
limitations with the Department's capacity, the legislation 
shifts the administration and management of this portfolio from 
the Department to capable entities charged with protecting the 
affordable housing stock in a fiscally responsible manner. 
Additionally, the legislation terminates the government's 
relationship with owners who fail to comply with Federal 
requirements and ends the practice of subsidizing properties 
that are not economically viable.

            selecting participating administrative entities

      This legislation utilizes capable public entities, 
nonprofits, and for-profit entities to act as participating 
administrative entities (PAEs) on behalf of the Federal 
government. Priority consideration is provided to public 
agencies, namely State and local housing finance agencies. The 
Secretary is required to provide interested public agencies 
with an exclusive time period to determine if the entities are 
qualified to act as PAEs. During this time period, the 
Secretary is required to evaluate the public agencies' 
qualifications, based on clearly established criteria, and to 
notify the applicants regarding the status of their proposals. 
The Secretary is required to select a public agency if it meets 
the selection criteria. If the proposal is rejected, the 
Secretary is required to provide a written explanation and an 
opportunity for the applicant to respond. Even in situations 
where a public agency is rejected under the exclusive time 
period, the public agency is allowed to reapply when other non-
public entities are allowed to apply for the program. The 
conferees expect the Secretary to utilize qualified housing 
finance agencies (HFAs) to the greatest extent possible because 
of the HFAs' experience and expertise in affordable housing and 
their ability to ensure that the affordable housing stock is 
protected in a fiscally responsible manner.
      The conferees stress that the criteria established in the 
bill relate to a wide range of factors that are intended to 
assure that the PAE is capable of protecting the interests of 
residents, properties, and communities. Similarly, the 
conferees recognize that the participating administrative 
entities will be carrying out complex duties. In many cases, 
PAEs will be asked to determine, subject to guidelines 
established by the Secretary, appropriate rent levels for the 
project which will determine the section 8 subsidy cost and the 
amount of debt that will be refinanced into a second mortgage. 
As a result, they have the first responsibility for determining 
the appropriate subsidy costs borne by Federal taxpayers and 
the appropriate level of risk of nonpayment that Federal 
taxpayers shall bear.
      The conferees intend that any costs of any fees paid to 
the participating administrative entities, under the portfolio 
restructuring agreement are mandatory expenses of the 
appropriate FHA fund.
      Section 513(b) sets forth the process and criteria for 
selecting participating administrative entities. The conferees 
intend that these criteria and processes will result in the 
selection of participating administrative entities that are 
fully and unquestionably qualified to carry out these 
responsibilities on behalf of the American taxpayer. They 
should have the necessary expertise and capacity and the 
ability to ascertain the public interest both in reducing cost 
and risk and in maintaining the public purpose for which 
Federal support of this housing is provided.
      In situations where an HFA or local housing agency is not 
selected at the PAE, the Secretary has the flexibility to 
choose those qualified nonprofit organizations and other 
entities that have affordable housing missions and experience 
to serve as PAEs. If no qualified public or nonprofit entities 
are selected, the Department is provided with authority to act 
as the PAE in conjunction with other entities. The conferees 
are concerned about the Department's capacity and expects the 
Department or its contractors to carry out the restructuring 
only where adequate capacity exists. Under no circumstances 
shall a decision that directly affects the residents and 
community be made without a public purpose entity involved. 
Public purpose entities, including the Department, will be 
involved in all critical functions such as developing the 
rental assistance assessment plan, screening owners and 
properties for mark-to-market and monitoring the portfolio 
after restructuring.
      To facilitate optimal capacity for the restructuring 
program, interested public and nonprofit entities are 
encouraged to partner with various other entities. For example, 
public purpose entities could partner with public housing 
agencies, private financial institutions, mortgage services, 
nonprofit and for-profit housing organizations, Fannie Mae and 
Freddie Mac, the Federal Home Loan Banks, and other State or 
local mortgage insurance companies or bank lending consortia. 
Further, coordination or partnerships between different State 
and local housing entities are encouraged under this Act.
      The Act envisions that the Department will compensate 
participating administrative entities and other third parties 
to accomplish the purpose of the Act. Other mechanisms, such as 
equity sharing partnerships, are expressly prohibited beginning 
in fiscal year 1999. (The demonstration authority continued 
during fiscal year 1998 permits structures such as the 
nonprofit joint venture structure already in use by the 
Department in fiscal year 1997.)
      Specifically, section 513(b)(6)(B) of the Act prohibits 
any private entity from sharing, participating in, or otherwise 
benefiting from any equity created, received, or restructured 
as a result of the portfolio restructuring agreement. In 
addition, section 517(d) of the Act prohibits the Secretary 
from participating in any equity agreement or profit-sharing 
agreement in conjunction with any eligible multifamily housing 
project. These prohibitions were put in place because of 
concerns that equity sharing arrangements might skew the 
motivations of the participating administrative entities or the 
Department in ways counter to the public interest.
      The conferees note, however, that one of the public 
purposes of this Act is to reduce the cost to the taxpayers of 
section 8 subsidies and losses to the FHA insurance fund. 
Moreover, during the savings and loan crisis, the Resolution 
Trust Corporation found that the use of equity sharing 
partnerships between the public sector and the private sector 
resulted in lower losses to the taxpayer while effectively 
achieving other public goals.
      Likewise, the Department is using or is contemplating 
using such structures in a way that is consistent with the 
public interest. For example, under the FHA Mulifamily Housing 
Demonstration Program, the Department entered into a joint 
venture with a nonprofit organization selected through 
competitive bidding to restructure selected mortgages with 
assistance contracts that expired in fiscal year 1997. 
Similarly, the Department in contemplating selling notes on 
assisted projects to a partnership of state agencies and 
private investors, motivated to provide maximum return to the 
purchaser, and thus to the FHA fund, but with certain public 
policy decisions reserved to the state agency.
      Therefore, the conferees direct the Department to report 
to the Committees of jurisdiction, no later than February 15, 
1998, on the possible ways equity sharing partnerships might be 
incorporated into this framework as an optional alternative 
structure in implementing the Act, if the prohibitions in the 
Act were to be lifted. The report should discuss the advantages 
and disadvantages of those structures in achieving public 
purposes. The report should also consider what tax impact, if 
any, such structures would have on the owners of the projects.

       Functions of Participating Administrative Entities (PAEs)

      PAEs perform a variety of functions in order to reduce 
project rents, address troubled projects and correct management 
and ownership problems. PAEs are provided with 
portfoliorestructuring program responsibilities through a working 
agreement with the Secretary called ``Portfolio Restructuring 
Agreements.'' Under these agreements, PAEs are authorized to take a 
number of actions to fulfill the goals of this legislation. These 
actions include restructuring the project's debt, screening out bad 
projects and bad owners from the renewal and restructuring process, 
creating partnerships with other housing and financial entities and 
ensuring the project's long-term compliance with housing quality and 
management performance requirements.
      Before an eligible property is allowed to enter the 
renewal and restructuring process, PAEs are required to 
carefully evaluate the project owner's record in operating the 
property and the property's physical condition. The Act 
specifies the criteria which PAEs use to determine which 
properties qualify for section 8 contract renewal and mortgage 
restructuring. These criteria focus on ownership, management 
performance and the economic viability of the properties. It is 
at this time that the Federal government is provided with the 
opportunity to cleanse the inventory of bad project owners and 
properties which hurt residents and communities, and threaten 
the financial interests of the American taxpayer. Owners or 
purchasers who have been rejected from the restructuring 
process have the right to dispute the basis for the rejection 
and are provided with an opportunity to remedy the problem. The 
Secretary or the PAE has the discretion to affirm, modify or 
reverse any rejection.
      If the property owners are prohibited from restructuring, 
the Department is provided with authority to deal with the 
property in several ways, including to sell or transfer the 
project to a qualified purchaser. Preferences are provided to 
resident organizations and tenant-endorsed community-based 
nonprofit and public agency entities. If sales or transfers to 
qualified purchasers are accepted, the project becomes eligible 
to be restructured. In addition to sales and transfers, another 
option is partial or complete demolition of the project if the 
project is in such poor condition that rehabilitation is not 
cost-effective. The Department may exercise its foreclosure and 
property disposition powers to deal with troubled projects and 
owners. Under any of these scenarios, residents are protected 
from displacement with tenant-based assistance and reasonable 
moving expense funds.

                              rent levels

      Properties eligible for restructuring have rents set at a 
reasonable level near or at market rates based on the rents of 
other comparable properties in the market. In the event 
comparable properties cannot be identified, the bill allows 
rents to be 90 percent of the fair market rent (FMR). Exception 
rents are allowed using the budget-based rent calculation 
method when no comparable property exists or where 90 percent 
of the FMR does not ensure the financial viability of the 
properties. Budget-based exception rents are capped at 120 
percent of the FMR and only 20 percent of the inventory's units 
can receive these rents.
      The conferees are sensitive to the reality that many of 
the properties which may require budget-based exception rents 
are concentrated in certain metropolitan or regional areas. In 
particular, a large portion of the properties in the upper 
Midwest are elderly facilities in rural areas, which are 
particularly disadvantaged under the Department's fair market 
rent system because these properties were built to a different 
standard compared to general rental properties, and the nature 
of the rental housing depresses the FMRs. To address these 
types of problems, the Act provides the Department with 
authority to waive the 20 percent limitation in any 
jurisdiction which can demonstrate a special need. The 
Secretary is also authorized to waive the 120 percent exception 
rent cap on up to five percent of the restructured units in a 
given year for unique situations. The conferees urge the 
Secretary to exercise these options to ensure that certain 
geographic areas are not adversely affected.
      Likewise, in determining comparable rents, the 
participating administrative entity may take into account or 
may not take into account, as appropriate, units which are 
subject to rent control. The conferees are concerned that, if 
rent controlled units are excluded from the determination in 
every case, restructured rents could be too high in areas 
generally subject to rent controls. In that instance, taxpayers 
would pay more than necessary in section 8 subsidies.
      However, the conferees recognize that there will be 
situations where rent controlled units may not be the most 
useful determinants of market rents. For example, if in 
determining comparable rents the participating administrative 
entity finds a mix of controlled and uncontrolled buildings 
similar to the subject property, there may be justification to 
use only the uncontrolled properties as indicative of market 
rents. In addition, a participating administrative entity 
determining comparable rents in an area which contains both 
controlled and uncontrolled properties may choose to use 
uncontrolled properties as the source of comparability for a 
project not subject to rent control and to use controlled 
properties for a property subject to rent control. Finally, the 
conferees believe that there may be instances in which the 
participating administrative entity may need to look at rents 
outside the jurisdiction to best determine comparable rents. 
The conferees request the Department to provide flexible 
program guidance on this matter to the participants.

                       type of rental assistance

      The conference agreement mandates the continuation of 
project-based rental assistance for properties that 
predominantly serve elderly or disabled households and 
properties located intight rental markets. The conferees expect 
the Department to develop regulations, in consultation with affected 
parties, that define what constitutes a ``predominantly elderly'' or 
``disabled'' property and a ``tight'' rental market. In defining a 
tight rental vacancy market, the conferees believe that a six percent 
vacancy rate is reasonable. However, as stated previously, the 
conferees expect some flexibility in the regulations to account for 
local market variations. It is most likely that metropolitan areas such 
as New York City, Boston, Salt Lake City, and the San Francisco Bay 
area will be considered to be tight rental markets by most real estate 
experts and, therefore, covered under the mandatory renewal provisions.
      For the remainder of the inventory, PAEs are permitted to 
either continue project-based assistance or can convert some or 
all assisted units in a property to tenant-based assistance 
pursuant to the rental assistance assessment plan. This 
decision is made only after the PAE consults with the project 
owner, local government officials and affected residents.
      The conferees note that the Act establishes eight factors 
to be considered by the participating administrative entity in 
determining whether a section 8 contract should continue as 
project-based or be converted to tenant-based certificates and 
vouchers. Each of these factors is relevant to such 
determination. The Act, however, given no weight to one factor 
over another and the conferees have no predetermined 
expectation about how many projects will be converted.
      Instead, the importance of each factor is to be 
determined in the context of each project. The conferees expect 
that the participating administrative entity will not make a 
numerical calculation of the number of factors weighing in 
favor of tenant-basing and the number of factors weighing in 
favor of project-basing, but instead will make a reasoned 
judgment about how, in each case, to achieve an appropriate 
balance of desired public policy goals as reflected by the 
factors. The PAE may take up to five years to convert the 
assistance to certificates and vouchers if the PAE decides the 
transition period is necessary and if such a transition period 
is necessary for the financial viability of the project.

                 mortgage restructuring and tax policy

      On September 15, 1997, the House Committee on Banking, 
Subcommittee on Housing and Community Opportunity, held a 
hearing on the tax consequences of FHA-insured mortgage 
restructuring for project owners. The subcommittee heard 
testimony speculating that the Treasury Department, most 
likely, would review the restructuring transactions envisioned 
in the Act based on the individual facts and circumstances of 
each project. Consequently, definitive answers could not be 
provided about whether this restructuring proposal would result 
in tax consequences for participating project owners.
      Moreover, the subcommittee heard testimony that, even if 
there was definitive guidance from the Treasury Department 
about the treatment of the restructuring transactions, some 
project owners could incur accelerated tax liabilities as a 
result of the restructuring and that, as a result, some project 
owners may not participate in the restructuring process. 
Finally, additional testimony suggested that Congress has no 
choice but to balance the budgetary cost of providing tax 
relief legislation with the budgetary savings that the 
restructuring proposals represent and with the program goal of 
maintaining the stock of low-income housing. Therefore, the 
conferees urge the committees of jurisdiction, early next year, 
to consider necessary legislation to ensure that the housing 
policy represented by this Act is not thwarted by owner 
concerns about tax liability.

                        property rehabilitation

      The conference agreement provides rehabilitation 
assistance but limits the extent of rehabilitation to a non-
luxury standard to prevent abuse. To further safeguard against 
excessive rehabilitation costs, a minimum 25 percent matching 
requirement from the owner is included in the Act. The purpose 
of this matching requirement is to encourage owners to invest 
their own funds in their properties and to reduce the risk to 
the Federal government. Rehabilitation assistance is provided 
either through project reserves, grants funded from acquired 
residual receipts, additional debt restructurings taken as part 
of the mortgage restructuring transaction, or from the 
rehabilitation grant program.

         office of multifamily housing assistance restructuring

      The Act establishes an Office of Multifamily Housing 
Assistance Restructuring (OMHAR) within the Department, under 
the direction of the Secretary, to implement the Act, to 
oversee the multifamily housing restructuring process performed 
by participating administrative entities and, when necessary, 
to restructure the mortgage. The conferees intend that OMHAR be 
staffed with expert employees and have access to private 
expertise to accomplish the purposes of the Act.
      To do so, OMHAR must have or obtain expertise and skills 
in real estate development, in management and finance, in 
financial and market analysis, in auditing, evaluation and 
oversight, and in accounting and taxation. The conferees direct 
the Secretary to ensure that such expertise and skills are 
available to OMHAR. The Act gives the Secretary the flexibility 
to obtain competent personnel from other agencies and to 
contract for expert services. However, theconferees expect that 
these avenues, and the existing Departmental staff, may not be 
sufficient to obtain the necessary skills. Therefore, the conferees 
expect that the Secretary may be required to hire new employees for 
OMHAR to perform effectively.

                    special consultation procedures

      Section 522 of the Act requires the Department to develop 
final regulations within twelve months from the date of 
enactment. During that period, the Department is to collect and 
respond to numerous public comments on several issues. However, 
in order to focus special attention on two critical issues, the 
conferees have included special requirements for the Department 
to seek comment through three public fora at which specified 
parties may make recommendations on:
            --the selection process for participating 
        administrative entities; and
            --the mandatory renewal of certain contracts with 
        project-based assistance.
      Regarding the selection of participating administrative 
entities, the conferees stated previously that entities fully 
qualified shall be selected to undertake the complex task of 
restructuring the debt and assistance for multifamily projects. 
To this end, the selection criteria are intended to assure 
competent and efficient participants. The conferees urge the 
Department to use the fora to elicit a wide range of concerns 
and recommendations from affected parties as to implementing 
the selection process to accomplish this end.
      Section 522 also directs the Department to solicit views 
on how to implement the requirements that section 8 assistance 
be renewed as project-based assistance for tight markets 
(section 515(c)(1)(A)) and when ``a predominant number'' of the 
units are occupied by elderly and/or disabled families (section 
515(c)(1)(B)). The conferees believe it would be helpful if 
interested parties address the extent to which a project must 
be occupied by elderly and/or disabled persons to qualify for 
mandatory renewal, particularly rural projects which house 
elderly and disabled persons, in light of the factors that must 
be assessed in the rental assistance assessment plan.

                   conference total--with comparisons

      The total new budget (obligational) authority for the 
fiscal year 1998 recommended by the committee of conference, 
with comparisons to the fiscal year 1997 amount, the 1998 
budget estimates, and the House and Senate bills for 1998 
follow:

New budget (obligational) authority, fiscal year 1997... $85,895,503,442
Budget estimates of new (obligational) authority, fiscal 
    year 1998...........................................  90,990,338,000
House bill, fiscal year 1998............................  91,461,593,000
Senate bill, fiscal year 1998...........................  90,367,535,000
Conference agreement, fiscal year 1998..................  90,735,430,000
Conference agreement compared with:
    New budget (obligational) authority, fiscal year 
      1997..............................................  +4,839,926,558
    Budget estimates of new (obligational) authority, 
      fiscal year 1998..................................    -254,908,000
    House bill, fiscal year 1998........................    -726,163,000
    Senate bill, fiscal year 1998.......................    +367,895,000

                                   Jerry Lewis,
                                   Tom DeLay,
                                   James T. Walsh,
                                   Dave Hobson,
                                   Joe Knollenberg,
                                   R.P. Frelinghuysen,
                                   Roger F. Wicker,
                                   Bob Livingston,
                                   Louis Stokes,
                                   Alan B. Mollohan,
                                   Marcy Kaptur,
                                   Carrie P. Meek,
                                   David E. Price,
                                   Dave Obey,
                                 Managers on the Part of the House.
                                   Christopher S. Bond,
                                   Conrad Burns,
                                   Ted Stevens,
                                   Richard Shelby,
                                   Ben Nighthorse Campbell,
                                   Larry E. Craig,
                                   Thad Cochran,
                                   Barbara A. Mikulski,
                                   Patrick J. Leahy,
                                   Frank R. Lautenberg,
                                   Tom Harkin,
                                   Barbara Boxer,
                                   Robert C. Byrd,
                                Managers on the Part of the Senate.

                                
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